The Consumer Financial Protection Bureau (CFPB) is working to make sure that financial services providers – like debt collectors and mortgage lenders – follow the law. They keep a close watch to keep you from getting treated unfairly.
This week, the CFPB released a report on their supervision work in several areas, including mortgage lending, mortgage servicing, debt collection, credit report accuracy, and student loan servicing, from January to April of this year.
The CFPB’s verdict? Not everyone has been following the rules.
Here are a few of their findings:
- Not all of the credit bureaus they examined were adequately supervising the companies that provide them with that information that ends up on credit reports. Nor do they always conduct adequate tests to make sure the finished reports are correct.
- Some debt collectors did not properly address inquiries and complaints, and didn’t always conduct a thorough investigation into accuracy disputes, as they’re required to by law.
- Regarding mortgages, some consumers still face dual tracking in mortgage loan servicing. For example, some consumers received a notice of intent to foreclose, even though they had been granted a trail modification. Others, due to a mistake, received foreclosure notices, even though they were up-to-date on their loans.
- Also in mortgages, the CFPB noted that some consumers still faced runarounds with their loss mitigation applications. For example, at least one mortgage servicer asked for more documents from consumers when it wasn’t necessary, and others didn’t send notice to consumers within five days of obtaining their applications. This made it more difficult for the consumers to get permanent loan modifications.
- In addition, the Bureau examiners found that at least one mortgage lender rejected or discouraged applicants who would have used public assistance to pay back their mortgage loan, in violation of the law.
The CFPB has recently fined companies $11.6 million, which will be returned to some 80,000 consumers. And, according to the Bureau, many of the problems identified in their supervision activities are addressed, even without an enforcement action.
We’re grateful that the watchdog agency keeps an eye on these companies. Supervision and enforcement are critical in protecting consumers from harm in the marketplace. We need the CFPB to protect us from deceptive and abusive practices of big banks, credit card companies, debt collectors, and payday lenders.
Join us in telling the CFPB and Director Cordray how much we appreciate what they’re doing. In addition, if you have had a bad experience with a financial services company or product and the CFPB has helped, let us know. Please share your story!