Today, the Consumer Financial Protection Bureau (CFPB) released its consumer complaints snapshot, featuring mortgage complaints as this month's focus.
"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 writes. "The Bureau will continue to work to make sure that consumers are being treated fairly on their mortgage issues."
Mortgages make up the largest consumer financial marketplace in the United States, totaling over $10 trillion. This has prompted the CFPB to implement stronger legislation aimed at protecting consumers in the process of buying a home. Between 2011 and September 1, 2015, the agency has handled almost 200,000 mortgage-related complaints, more than any other type.
Some of the most common complaints include:
- Continued problems preventing foreclosure: Over 50 percent of mortgage complaints have to do with problems consumers face when they are unable to make payments. Consumers complain of delays and a lack of information when applying for a loan modification. Additionally consumers complain that servicers often move forward with foreclosure proceedings while the consumer's modification application is still under review.
- Lack of information when loans are transferred: Consumers report experiencing confusion and frustration about where to make payments when loans are transferred. When the loan transfers occur, consumers complain that payments often increase unexpectedly. Consumers also say that they do not feel properly informed about their loans being transferred in the first place.
- Trouble making payments: Nearly a third of mortgage complaints came from consumers saying that they have trouble making the proper payments on their mortgage loans. Consumers describe companies not accepting payments of anything less than the full balance owed, or finding that their payments were not properly applied despite instructions from the consumer.
- Most-complained-about companies: Wells Fargo, Bank of America, and Ocwen were the three companies about which the CFPB has received the most mortgage-related complaints. Between April and June 2015, the three companies averaged around 430 complaints per month.
The Dodd-Frank Wall Street Reform and Consumer Protection Act, which created the CFPB, established consumer complaint handling as an integral part of the CFPB's work. It currently accepts complaints on many consumer financial products, including credit cards, mortgages, bank accounts, private student loans, vehicle and other consumer loans, credit reporting, money transfers, debt collection, and payday loans.
The CFPB recently made improvements to its " Know Before You Owe "program, which provides an interactive, step-by-step overview to help buyers know what they can afford and provide assistance in filling out all the necessary forms.