CFPB Releases Report Analyzing Consumer Complaint Data By Demographics

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The Consumer Financial Protection Bureau (CFPB) issued its first in-depth report analyzing consumer complaint submission patterns by demographic characteristics.

The CFPB’s findings were based on nearly 1 million consumer complaints submitted to the CFPB between 2018 and 2020.  The CFPB’s report classified complaints by matching the relevant consumers to U.S. Census tract demographic data.  The credit life cycle categories used for the CFPB’s findings are loan origination, servicing of performing loans, delinquent and distressed servicing and collections, and credit reporting.

The report found that complaints from wealthier communities and communities with higher percentages of white, non-Hispanic residents were more frequently about loan origination and servicing of performing loans.  Complaints from communities of color and lower income communities, the report observed, were more frequently about credit reporting, identity theft, and delinquent servicing.  The report also found that Asian American and Pacific Islander communities had higher rates of submitting credit reporting complaints than predominantly white, non-Hispanic communities; however, they also had a lower share of delinquent servicing complaints.

The report’s other key findings included the following:

  • Complaints about loan originations increased by nearly 50% over the course of 2020, driven largely by mortgage complaints. This increase was centered in higher-income neighborhoods and neighborhoods with fewer people of color.
  • Neighborhoods with the highest share of white, non-Hispanic consumers submit complaints about loan originations at more than twice the rate of neighborhoods with the highest share of Black consumers.
  • Consumers from neighborhoods with the highest share of Black residents submit the most complaints per resident. Census tracts with the greatest share of Black residents (95% and over) have estimated complaint rates that are double the rates for tracts with the lowest share (5% and under).
  • Lower income census tracts (those at or below 40% of their area’s median income) submit around 30% more complaints per resident than census tracts at around 100% of their area’s median income.
  • Lower-income and communities of color are more likely to submit complaints about credit reporting, identity theft, and delinquent servicing, while higher-income and majority white, non-Hispanic communities are more likely to submit complaints about origination and performing servicing.

CFPB Acting Director Dave Uejio stated that “consumer complaint data is a crucial tool for understanding various consumer experiences, including across racial and economic divides.”  The CFPB intends to use the research in the report, as well as research into consumer complaint data, to inform its work in the future.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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