Mortgage loans in today's housing market are not keeping homebuyers happy, as they are most complained about product in the eighth volume of the Consumer Financial Protection Bureau's (CFPB) Monthly Complaint Report.
The CFPB's report, released Tuesday, showed that as of February 1, 2016, the CFPB has handled a total of 811,700 complaints nationally, up 8 percent from December 2015 and January 2016.
The three most-complained-about financial products were debt collection, mortgages, and credit reporting for January 2016, representing 67 percent of complaints submitted.
In January 2016, the Bureau received 21,800 complaints, and 4,263 of these were mortgage-related complaints, up 12 percent month-over-month. Mortgages were the second most complained about category this month but the highest complained about financial product overall. The CFPB has received a total of 213,861 mortgage-related complaints.
The CFPB began accepting complaints from consumers about financial products shortly after opening its doors in July 2011. The mortgage market is the largest consumer financial marketplace in the country with more than $10 trillion in total value. The CFPB enacted new mortgage rules in 2014 to ensure strong consumer protections and also ensure that lenders offered affordable mortgages to consumers.
"Despite strong protections that have been put in place to protect homeowners, this month’s complaint report shows consumers are still having problems when dealing with their mortgages," CFPB Director Richard Cordray said. "The Bureau will continue to work to make sure that consumers are being treated fairly on their mortgage issues."
The CFPB once again pointed to the credit reporting agencies, Equifax, TransUnion, and Experian, as the top three most complianed about companies from September and November of 2015.
The CFPB's Consumer Complaint Database has generated much controversy since June when it began publishing narratives of complaints from consumers. So much so that CFPB Director Richard Cordray issued a rare public response to the criticisms in late November.
The CFPB’s Ombudsman Office issued its annual report for FY 2015 to Cordray outlining potential changes to the database. One of the items mentioned was a need for the normalization of data presented.
Also according to the Ombudsman’s report, the CFPB and companies are working together to prevent duplicate complaints from being published in the database and that in recent months the companies are taking more of a role in identifying duplicate complaints. The Ombudsman recommended that Consumer Response share an expanded definition of “duplicate complaint” on the Consumer Complaint Database website to include complaints that are from “the same person, same transaction, and same issue” and not just complaints that are simply verbatim copies of previous complaints. The purpose of expanding the definition of “duplicate complaint” is so database users can adjust their calculations and analyses accordingly, according to the report.
“In our FY2014 Annual Report, we highlighted the concern from industry groups about the need for normalization of data in the public Consumer Complaint Database to provide context to the data and continued to hear this and related concerns in FY2015,” the Ombudsman stated. “This year, we provided feedback and suggestions to the CFPB regarding normalization of the data.
Click here to view the full report.