On November 29, 2016, the Consumer Financial Protection Bureau (CFPB) released its monthly complaint report. For the month of October 2016, the products and services generating the most complaints were debt collection, credit reporting, and mortgages, collectively representing about 65 percent of complaints.
In a year-to-year comparison covering the three-month time period between August and October in 2015 and 2016, student loans showed a marked increase in complaints ‒ 108 percent ‒ the greatest percentage increase in complaints of any product or service. During the same period, complaints about prepaid products, payday loans, and mortgages declined by 51 percent, 22 percent, and six percent respectively. Interestingly, the three product categories showing the greatest percentage decline in complaints have been, and continue to be, the focus of CFPB rulemaking initiatives.
The report focused on complaints about debt settlement, credit repair, check cashing, refund anticipation checks, and money orders. The CFPB categorizes these types of complaints as “other financial service complaints.”
Regarding these other financial service complaints, the CFPB found that debt settlement is the service that generates the most complaints, constituting 50 percent of other financial service complaints. Credit repair and check cashing services each constituted 12 percent of other financial service complaints.
The most common issues raised by consumers involved fraud or scam (51 percent) and customer service or customer relations (18 percent). Consistent with the increase in student loan complaints, the CFPB noted that complaints about fraud or scam often involved consumers who sought to settle or consolidate their existing student loan debts.