Docketly Legal Updates: October 2021

by Sam Pierce
Oct 29, 2021

Consumer Complaints by Demographic Characteristics: A CFPB Study

 

In September 2021, the Consumer Financial Protection Bureau (“CFPB”) published a comparison of communities across the United States to assess consumer complaints in relation to various socioeconomic population segments*.  Specifically, the case study found that complaints lodged by non-Caucasian populations varied starkly from segments of the population that are primarily Caucasian.  According to the CFPB, their recently published “analysis is best thought of as comparing different American communities.”

 

Nearly a quarter of all consumer complaints submitted to the CFPB since it began accepting the same in 2011, representing more than 700,000 complaints, “have been submitted since the declaration of the coronavirus (COVID-19) national emergency on March 13, 2020.”  The CFPB, utilizing data from various third parties and census data, revealed that “greater complaint rates were associated with communities that were more heavily Black or African American, more educated, higher income, older and more urban.”  By contrast, lower consumer complaint rates “were associated with communities that were predominantly Hispanic or Latino and had larger household sizes.”  The CFPB analysis reviewed the occurrence of complaints related to loan origination, performing servicing loans, delinquent servicing, and credit reporting in comparison to whether a community was predominantly (a) Black or African American, (b) Hispanic or Latino, (c) Asian American or Pacific Islander; or (d) Caucasian.  The CFPB also analyzed a community’s average median income in relation to incidents of complaint filings.  The CFPB’s findings are summarized below. 

 

With respect to average median income compared to the number of complaints filed, the CFPB found that communities with the lowest average median income submit the highest percentage of complaints relating to credit reporting.  Mid-level and low-level median income communities submit more delinquent servicing complaints than communities with the highest average median income.  Meanwhile, communities with the highest average median income file the largest percentage of performance servicing and loan origination complaints.

 

In analyzing Caucasian communities, the CFPB found that Caucasian populations had the highest percentage of loan origination and performing servicing complaints, delinquent servicing complaints were relatively equal across all Caucasian communities, and credit reporting complaints were the lowest among all Caucasian communities.   

 

Meanwhile, while analyzing Black or African American communities, the CFPB determined that Black or African American communities had the lowest percentage of loan origination and performing servicing complaints, delinquent servicing complaints remained relatively equal across all Black or African American communities, and credit reporting complaints were the highest among all Black or African American communities.    

 

While reviewing Hispanic or Latino communities, the CFPB found that Hispanic or Latino communities had the lowest percentage of loan origination and performing servicing complaints, delinquent servicing complaints remained relatively equal across all Hispanic or Latino communities, and credit reporting complaints were the highest among all Hispanic or Latino communities.

 

Finally, in reviewing Asian American or Pacific Islander communities, the CFPB determined that Asian American or Pacific Islander communities had the highest percentage of loan origination and performing servicing complaints, while delinquent servicing and credit reporting complaints were the least filed complaints in Asian or Pacific Islander communities.  


  •  For a complete discussion, see Consumer complaints throughout the credit life cycle, by demographic characteristic, Consumer Complaint Research Brief, published by the CFPB September 2021 and located here: https://files.consumerfinance.gov/f/documents/cfpb_consumer-complaints-throughout-credit-life-cycle_report_2021-09.pdf 

Subscribe to Our Blog