As we move toward the second anniversary of President Obama signing the Dodd-Frank financial reform law, more than 45,000 people have filed complaints with the newly created Consumer Financial Protection Bureau.
In one case, a 77-year old Army veteran and retired businessman living in Georgia was certain he had paid off his mortgage, but his mortgage servicer insisted he still owed money. The man was blind and had trouble finding paperwork that proved he owned his home was free and clear. After CFPB interceded, the bank agreed that the mortgage was fully repaid in 2007, then sent the borrower a $30,000 check.
In another complaint, CFPB helped a 31-year old Florida waiter reduce his monthly student loan repayments. The young man’s dream of becoming an artist led to a decision to enroll in a for-profit college, where he sunk $110,000 into debt while earning an associate’s degree. He was unable to find work in his chosen field and began paying $700 a month to a private student loan lender. By the time his federal student loan payments were added, he could barely manage to make ends meet after paying $1,100 in total loan costs.
When the private loan company refused to adjust payments, the young man contacted CFPB. They determined that he was eligible for a reduced payment program that cut his monthly payment to only $407 monthly for 12 months. He is still working out a plan to reduce federal loan payments.
There are even more successful stories of how consumers working with the CFPB were better able to manage financial debt. From July 21, 2011 through June 1, 2012, 45,630 consumers contacted the CFPB. Mortgage issues ranked highest (19,250 complaints); followed by credit cards (16,840); bank products and services (6,490); and private student loans (1,270). Companies contacted by CFPB are also responding – responses have been received on approximately 33,000 complaints.
CFPB accepts complaints via its website, by telephone, mail, e-mail and fax.
Consumers opting to phone use a toll-free, U.S.-based call center that offers assistance in 187 languages, accommodating hearing and speech-impaired callers.
With information in hand, CFPB then determines if the complaint falls within the bureau’s enforcement authority. Once that basic threshold is met, affected companies are contacted for review and reply. While the complaint is in progress, consumers can log onto a secure portal or call the toll-free number to receive status updates, provide additional information and review responses submitted by companies.
CFPB has also gained further consumer insights through written comments on a range of topics. For example, in response to a larger than expected attendance at a January 2012 payday lending public hearing in Birmingham, Ala., CFPB offered a comment period for persons and organizations either unable to attend or speak. By the time the comment period closed, 620 comments were filed. The majority of the comments received spoke directly to consumer needs and concerns, some citing CRL research.
Speaking on behalf of the Leadership Conference on Civil and Human Rights, Wade Henderson and Nancy Zirkin wrote in part, “Regardless of the precise source of payday loans, their effects are the same. They come with triple digit interest rates.
Communities and consumers are targeted, rather than served. And according to the Center for Responsible Lending, each year more than $4.2 billion of otherwise valued and disposable income are lost to the accompanying predatory fees.”
If you or someone you know will comment or make an online complaint, visit http://www.consumerfinance.gov/. Calls are accepted from 8:00am – 8:00pm Monday through Friday at (855) 411-2372.
Charlene Crowell is the Communications Manager for State Policy & Outreach with the Center for Responsible Lending.