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The Facts about Payday Loans the CFPB would rather you did not know about

We have officially reached a point where a good number of people are all too aware that the Consumer Financial Protection Bureau (CFPB) is on a mission to cripple – possibly even eliminate – the payday lending industry. The CFPB officially released its proposed regulations for this industry earlier this summer, and it seems that the Bureau and the payday lending industry are on a collision course. There are some things about payday lending that the CFPB would probably rather that you did not know about.

Are Payday Loans PredatoryIs the Glass Ceiling Sending Women to Payday Lenders

When you think of a predator, you probably think of a vicious, wild animal that hunts down defenseless creatures in the wild. This is a pretty brutal picture, right? It’s easy to understand why the CFPB continues to refer to payday lenders as being predatory. They want people to picture huge lending companies that are mercilessly making life difficult for the poorer people of this country. The truth, however, doesn’t seem to indicate that payday lenders are predators at all.

The CFPB has been collecting consumer complaints via an online database for several years now. Consumers are allowed to log complaints about every type of financial service/product from their local banks to debt collectors. They are also able to log complaints about payday lending companies. If payday lenders are really preying on people, you’d think that a lot of those people would be doing everything they could to make it stop. That means that we would expect to see tens of thousands of complaints about payday lending in the CFPB’s official database.

That’s not what we’ve seen, though. Payday loan complaints make up a miniscule amount of total complaints logged thus far. As a matter of fact, complaints about payday lending companies account for far less than 1 percent of the total complaints logged to date. But there are plenty of complaints in the database that people have taken the time to officially submit. Mortgage lenders, debt collectors and even credit card companies have managed to be the most complained-about topics so far.

One would have to assume that if the CFPB is receiving more complaints about mortgage loans, credit cards and other types of financial products/services that the Bureau would focus on doing what they can to introduce rules that those industries must adhere to; rules that would more effectively protect consumers. But what are they doing instead? They have focused a lot of time, energy and money on regulating an industry at the federal level that is already regulated quite effectively at the state-level.

What we have here is another case of an arm of the federal government sticking its nose where it doesn’t belong. If payday loans were such a huge problem – if payday lenders were predators – then people (to the tune of about 10 million to 12 million per year) would not be going back to these lenders, and they would certainly be logging complaints about being preyed upon.

Could it be that the larger lending companies can afford to do what they want because they have more money and maybe even help to prop up the political careers of certain elected officials? Maybe. Could it be that since the CFPB has been nothing more than a puppet for the Obama administration (and Obama has gone on record about his personal disdain for payday loans) that the group is simply using its power to toe the line, so to speak? People need money for emergency expenses. Payday lenders are often the only resource that lower income households can turn to. Complaints about the industry from real people are minimal. SO why the continued focus on an industry that supplies a legitimate service and that consumers are obviously not against? These are the kinds of questions that need to be brought to the table, and the CFPB must answer them if it hopes to maintain any semblance of being a legitimate protector of American consumers.

The CFPB is a top concern with Elections Right around the Corner

Any time we get close to a big election, financial issues are always a top priority for candidates and voters. A banking regulation issue that both Republicans and Democrats have a lot of concern about is that of the Consumer Financial Protection Bureau (CFPB.) As might be expected, neither side sees eye-to-eye on this topic.

Generally speaking, Republicans are in favor of less regulations on the banking industry. As such, this party believes that the CFPB is a rogue government agency. They have said that its work has done nothing but make trial lawyers rich while clogging up the system with troublesome investigations. Democrats, for their part, have stood behind the creation of the agency and have supported additional regulations on the banking industry. They say that the agency is dedicated to protecting the interests of American consumers.350737613_80_80 cfpb

As important as the issue is, it will likely become even more important over the next few months. As we get closer to the next elections, both parties will likely work hard to sway voters to take their side in the battle over which banking regulation approach is best for the United States. This battle is a lingering effect of the financial meltdown of 2008. Industry experts believe that the crisis never would have happened if the right kinds of checks and balances were in place back then, and that new legislation – including the creation of the CFPB – were intended to help prevent a similar financial crisis from happening in the future.

Financial analysts state that the Republican perspective on the CFPB fits in with the position that the U.S. Chamber of Commerce and bigger banks have taken. The U.S. Chamber of Commerce looked at 251 CFPB-studied cases. It turns out that lawyers averaged about $1.35 million per case on these sample cases. Banks have also gone on record about being concerned with complaints that are difficult to justify. A statement from Frank Keating of the American Bankers Association said, “While the banking industry is committed to helping consumers make informed and responsible financial decisions, public disclosure of unverified consumer complaint narratives doesn’t advance that goal and raises significant consumer privacy issues.”

Supporters of the CFPB, however, see things a bit differently. They believe that the things the CFPB has been doing have been important aspects of the overall banking regulatory foundation. At the DNC, Elizabeth Warren said, “Five years later, that consumer agency has returned $11 billion to families who were cheated. And Republicans? Republicans, they’re still trying to kill it.” Warren, of course, has a vested interest in the success of the CFPB. After all, she was one of the chief architects of this agency, and has been one of the CFPB’s most vocal supporters over the years.

Recently, the CFPB took action against one of the country’s leading banks. This action came after the bank allegedly did not comply with Dodd-Frank Wall Street Reform and Consumer Protection Act regulations. The CFPB said that the bank charged illegal fees on educational loans and that it did not give payment information to borrowers that they are legally required to provide.

We won’t see either side back down when it comes to the ideological battle over the CFPB. Voters need to learn as much as they can about the Bureau and the various issues it has been involved with over the years. They then need to support what they believe to be right by casting votes to support any measures that are directly related to the future of the CFPB. It may prove to be a battle that goes on for some time, but voters need to understand the issue and then vote accordingly to effect positive change.

Revamped Payday Loan Regulations under review

As the 2016 summer weather has continued to heat up so, too, has the drama surrounding payday loans, car title loans and other types of alternative financial services. From the most popular news websites to popular talk shows, payday loans are being discussed quite a bit. Why so much attention right now? Because in June the Consumer Financial Protection Bureau (CFPB) officially published its proposed rule to regulate payday loans, title loans and other types of alternative loans. The CFPB has even asked the public for feedback on the proposed rule.Banks Being Scrutinized By Regulators for Payday-Like Loans

Financial experts have even been tasked with looking the rule over and letting the public know what they think about it. Though payday loans have been a hot topic, financial experts have repeatedly stressed that the general public still lacks a fundamental understanding of payday loans, and the alternative financial services industry in general. Being as most media pieces on payday lending rules seem to be centered on the CFPB, it is easy to understand why some people tune out when they hear this topic being addressed. Understanding the new rule, what the CFPB is trying to do and how the payday lending industry could be affected by the rule are all things that American consumers should pay closer attention to.

The CFPB is officially recognized as an ‘administrative agency. What the heck does that mean? Essentially, an administrative agency is a lawmaking organization that specializes in a particular area. For example, the Environmental Protection Agency is one such agency that makes laws related to the environment, and the IRS (boo!) is the best known administrative agency related to revenue processing. The CFPB is a relatively new administrative agency. It was created as part of Dodd-Frank back in 2010. The Bureau was given the power to make laws related to consumer financial issues. It does this by creating rules. Once those rules get finalized they become federal law. The public is being given the opportunity to review the rules the CFPB creates, and we can also comment on any proposed rules. The official name of the newest rule is the “Payday, Vehicle Title and Certain High Cost Installment Loans” rule. It proposes to implement new consumer “protections” that the CFPB states will prevent consumers from getting into long term cycles of debt.

It is important for people to check out the rule and provide feedback. This is especially true for people who operate payday lending locations, work at them or enjoy having the ability to take out the types of loans that they want to. The proposed rule is currently available to look at on the CFPB’s website. Be warned, though, like other laws and federal rules, the new rule is very wordy and reading all of it could take a good chunk of time. Don’t let that dissuade you from at least giving it a look and deciding for yourself what you think about the proposed rule.

Going online for most folks may be more about checking out news sites and social media sites, but that doesn’t mean that you shouldn’t take a bit of time out of your day to check out important stuff, like this proposed new rule. A lot of opponents of the CFPB have accused the agency of running roughshod as of late. Looking at the new rule and then finding out what opponents of the rule believe will help you to be better informed about this important topic. Just because an administrative agency has the power to do something that does not necessarily mean that it should. Take a look for yourself and let the CFPB know what you think.

Proposals Could Help Cable Subscribers to save a lot of money

There is no doubt about how drastically things have changed with regards to watching TV shows, sports or even movies. From Netflix to Sling TV, there are now so many streaming services available that some people are foregoing subscribing to cable altogether. There are, however, still millions of people who still pay for packages from the top cable providers. Even lots of folks who have started using more streaming services still rely on their preferred cable provider for some of their television content.night-television-tv-theme-machines

Paying for content is one thing – and you do that whether you get cable, satellite TV or streaming services. However, the cable companies don’t only charge you for the content you watch; they also charge their customers for the equipment that is used to deliver said content. This equipment usually comes in the form of a cable set-top box. Subscribers actually rent these devices, and pay an average yearly cost of about $231. All of those “rental fees” add up to about $20 billion each year for the big cable companies.

This may all change, though, as the FCC is looking at a couple of proposals to eliminate the cable set-top boxes that so many fork out money to pay for. The news of these new proposals should be music to the ears of cable subscribers. However, the cable companies are not keen on potentially losing billions of dollars in box rental fees, so there will be a bit of a battle over these proposals.

The two proposals that the FCC is looking into would both replace traditional cable boxes, but the proposed plans vary considerably. In January, the FCC Chairman proposed that subscribers should be able to scrap the set-top box in favor of a more affordable device created by third party companies. These devices would do the same thing as the cable boxes, but would also allow people to pick up their streaming content services.

As you might have guessed, the cable companies are not exactly falling all over themselves to see this proposal through. They blame the proposal on the huge tech company, Google. Since it is well known that Google is expanding into the cable/broadband Internet market, the cable companies believe that Google would wind up being one of the third-party companies that offers their new device to people. Other companies that may also develop these devices include Apple and Amazon. Comcast, Dish, Time Warner and other cable providers have banded together to start a new lobbying group called the Future of TV Coalition. By way of this group, along with Hollywood studios, the cable industry is in full-on attack mode against the new proposals. The United States Copyright Office has so far agreed with the big cable companies and the original proposal may be losing steam, while the other proposal – which would replace the old cable boxes with proprietary apps – is beginning to gain more ground.

TV Content Delivery Industry is Evolving

Regardless of which proposal winds up being the favored proposal, the fact of the matter is that things are about to change for both cable subscribers and providers. While it is understandable that the cable companies would be upset about the potential loss of so much rental revenue, TV content delivery is a market that is on the cusp of even bigger changes in the future. And if consumers stand a chance at saving over $200 a year because of potential upcoming changes, you can bet that most people will be more than glad to get rid of those cable boxes that they have been forced to pay rental fees on for so many years.

Are Payday Loans really the Debt Traps they are made out to be?

When you’re poor you don’t have the same kind of options that other folks have when it comes to borrowing money. As a matter of fact, there really aren’t many lending options that are currently available to lower income Americans. One type of lending that has been helpful to poorer people over the years may soon wind up going away forever. The Consumer Financial Protection Bureau (CFPB) has created new rules that may prevent poor people from getting access to short term lines of credit. And these rules were created because the CFPB says it wants to get rid of “debt traps” that are caused by the payday lending industry.

About Payday LoansBanks Being Scrutinized By Regulators for Payday-Like Loans

The payday lending industry really started to take off in the 90s. Most folks have seen the small storefront locations that these lenders use as their base of operations. The lenders provide small dollar loans (usually for just a few hundred dollars) to their customers. The customer pays back the loan in a week or two and is charged a flat rate fee that must be paid back in addition to the money borrowed. It is typical for payday lenders to charge about $15 for every $100 a person borrows. So, if someone takes out a $200 payday loan, they must pay the lender $230 after the two week loan term is up. Pretty easy to understand, right?

The CFPB doesn’t think that process is very simple or easy to understand. In fact, they seem to believe that American consumers are so dumb that they couldn’t possibly understand and abide by those types of loan terms. That is why they have amped up their efforts to effectively eliminate the payday lending industry. They are looking to implement their proposed rules on a federal basis, so all the states have to fall in line with how the CFPB wants to regulate this industry.

One problem is, however, that individual states have already been doing a pretty good job of regulating the payday lending industry without eliminating the industry altogether. This doesn’t appear to be enough for the CFPB, though, as they have been pushing very hard to get their new rules implemented as soon as possible.

The New Rules

The CFPB wants to make lenders assess whether or not a borrower can pay back loans prior to the loan being made. They also want to make it more difficult for people to roll over old loans into new ones. If these rules become the law of the land, they will certainly shake up the payday lending industry. But that might not be a good thing after all.

We have to use critical thinking here to figure out why people take out payday loans. They do so because they need access to fast cash. Many of these people have low credit scores and/or very little access to traditional banking services. These folks have the same types of emergency expenses that everyone runs into from time to time. But without a lot of cash on hand or the ability to borrow from banks/credit card companies, they instead turn to payday lenders. The bottom line – people take out payday loans because they need to. They have no other avenues to pursue when they need emergency money. If the CFPB’s new rules drive thousands of lenders out of business we could potentially see millions of American households left with no option available to them at all when they need to take care of emergency expenses.

This is just another example of people/organizations saying they have someone’s best interest at heart, but really doing nothing more than making life more difficult for that person. Without payday lenders to turn to when hard financial times hit, poor people may wind up with nowhere else to turn than illegal (loan shark) lenders. That certainly isn’t the kind of outcome that anyone wants to see take place.

Federal Reserve Study on Online Lending is not Legit

They say that you can use studies and statistics to prove anything that you want; regardless of whether what you are trying to prove is even legitimate. Such is the case with a recent study that the Federal Reserve did with regards to consumer dissatisfaction with online lenders. According to this study only about 15 percent of small business borrowers reported being satisfied with online loans they were approved to get. Here’s the kicker – that statistic doesn’t even accurately reflect the data collected in this study. But people are now being hit with headlines about how much small business owners detest online lending. The thing is, though, that it’s just not true. And the study is pretty much bogus from all appearances.payday-online

The stat that we just mentioned is actually a representation of how many people were satisfied versus dissatisfied. You can check this out by looking at the study’s footnotes. So, the 15 percent is actually a net satisfaction metric that indicates more borrowers were satisfied with their experiences with online lenders than dissatisfied. If you do the math, this statistic actually shows that more than 50 of borrowers reported being satisfied. Banks did score higher than online lending companies in this report, but with as unscientific as this study was it is difficult to tell if that statistic is bogus or on the level.

An Unscientific Study by the Federal Reserve

The Federal Reserve puts a lot of interesting information in the footnotes and fine print of their study. If you cut through all of the confusing information, here is what it really says:

Businesses get contacted via email from organizations that serve the small business community in participating Federal Reserve Districts.

The data are not statistical representations of small businesses.

By its own admission, the authors at the Fed are very clearly stating that the data was not random – in other words the data is biased and not representative of real world statistics. The report even opens up by saying, “Our hope is that this report contributes to policymakers’ and service providers’ understanding of the business conditions, credit needs, and borrowing experiences of small business owners.”

We can now see that the metrics used in this study don’t mean anything in the real world. But they are still being cited continuously. A report that the US Treasury published a few months ago even makes a direct citation of the 15 percent satisfaction metric. It’s a standard case of bad information being created and published and then running amuck.

So what’s next? Now that this bogus study is being quoted and used all over the place, how do we get to the truth of the matter at hand? We are now at a point where critics and supporters of the online lending industry are even starting to buy into the bogus statistic about only 15 percent of small businesses being satisfied with online lending. This conclusion has never been reached by a legitimate study. No one is looking at the fine print from the Fed’s report. Hopefully, people within the industry will begin to look closer at these types of reports to see if what is being represented is truthful. When powerful agencies, like the Fed are able to get away with pushing what are essentially biased reports to the general public, it is easy to understand why so many people are up in arms about the online lending industry. If those folks would actually look at the facts, however, they’d find out that more small business owners are satisfied than dissatisfied with the online lending industry. It seems that is not the kind of true story, however, that the Fed wants the public to know about.

New Limitations on what Debt Collection Agencies are allowed to do

There could be no national economy without debt. Owing money is one of those things that is just a part of life. However, personal debt can get out of control and people may find it difficult to pay back the money that they owe to creditors. This is where debt collection comes into the equation. And it turns out that the people of this country are having some very big problems with debt collections companies. There are over 6,000 of these companies in the country and some of them use aggressive collections tactics in order to reclaim money that people owe.

There have been so many complaints about debt collections companies that the CFPB is proposing new rules that are designed to help bring this industry under control a bit, while providing some much-needed relief for American consumers who are struggling with repaying their debts.credit card debt

There are more than 130,000 people who work in the debt collection industry and those folks bring in over $13 billion each year. This industry has become more complex over the past few years. Some creditors will sell outstanding debts for pennies on the dollar. Third party debt collection firms purchase these debts and often use some very shady tactics to get their job done.

Chiming in on the current state of debt collections in the United States the CFPB Director, Richard Cordray said, “Often debt collectors are motivated to go to almost any lengths to try to extract as much as they possibly can from the debtor. This is because they are typically paid based on the amount they collect, the relationship may be fleeting, and the more distant risk of being called to account later may not outweigh the immediate urgency of getting paid today.”

If Cordray and the CFPB get their way, here are some of the things debt collectors will not be able to do in the future:

  • Collect on debts that do not exist. Some consumers have been hit up by debt collectors for money that they don’t even owe. This happens sometimes due to error and sometimes due to fraud on the part of debt collections companies. The CFPB has proposed that collectors will have to verify that a debt exists prior to beginning any collections actions.
  • Demanding payment without letting consumers know their rights. Debt collectors often rely on using confusing statements when they contact people. Debt collections companies will often only let people know their rights via cryptic, legalistic language the most people cannot understand. The CFPB wants to make these types of communications more transparent and easy to understand for consumers.
  • Endlessly harassing people to repay. Some collections agencies will call and even email people non-stop. They seem to think that the more they annoy people the more likely it is that they will be able to collect. The CFPB has proposed that limits be put on how many times debt collections agencies are allowed to make contact with consumers. The proposed limit is 6 times per week that agencies are allowed to contact people. This applies to phone calls, email or even letters sent to people.

The best way to avoid the hassles of dealing with debt collectors is to avoid getting in so much debt that you cannot repay what you owe. However, sometimes that is impossible, and sometimes you may not even really own money, but still wind up getting hassled by debt collectors. These new limitations should help people to avoid the potential nightmare that can happen when dealing with the worst kinds of debt collections companies.

Payday Lending Limitations may leave Borrowers out in the cold

Canton, Ohio is a city that is very much a typical American town. There are about 73,000 people living in Canton. It is also known for being the home of the Pro Football Hall of Fame and is known for having a thriving art scene in the downtown area. You may not know it, but Canton is also a city that serves as the nerve center of the payday lending industry. These smaller dollar loans allow people to borrow money for emergency expenses and to pay the lending company back a few weeks later. There are a lot of lenders in Canton, and a lot of people who regularly borrow money from these lenders.

Tanya Alazaus is the manager of a payday lending store in Canton. During a typical business day she sees a lot of regular customers and works hard to make sure that people get the financial services and products that they need to get by. Alazaus is a lot like any business manager or owner, and she works hard to make sure her customers get great service. It is her job. One that may be in danger if new payday lending limitations get put into place.unsecured-loans-can-be-easily-obtained-through-payday-lenders-direct-6516

Federal regulators are on a mission to crack down hard on businesses just like the one that Tanya manages. They consider payday lenders to be predatory and are coming up with new regulations that will likely lead to a serious decline in the overall volume of loans given each year. Additionally, the new payday lending regulations will probably force thousands of lending locations to close their doors for good.

The main agency that is working hard to over-regulate the payday lending industry is the Consumer Financial Protection Bureau. This agency has drafted new rules for payday lenders that will lead to greater overhead costs associated with providing loans, and that will put a cap on how many loans people are allowed to take out over the course of the year. These two repercussions alone are likely going to spell disaster for small lending companies, like those that help to prop up the economy in Canton, Ohio.

Many lenders are worried about what will happen to their customers if they are unable to get payday loans in the future. Ms. Alazaus said, “My customers look forward to being able to walk in here for their short-term needs. They would rather use us than things like credit cards, and most don’t even have the ability to use those.”

Ohio is a state that has some of the highest per-capita payday lending usage in the country. It is a state with more payday lending locations than it has McDonald’s franchises. There are already at least 14 states that have banned payday lending altogether. Ohio may soon join theses states in restricting payday loans completely. Factor that in with the federal regulations that the CFPB has been proposing, and it is easy to see the writing on the wall.

No one from the regulatory side of the house, though, seems willing to admit that imposing strict regulations on payday lenders is really going to only punish lower income American consumers at the end of the day. These are the people who depend on payday loans the most, and many of them have no alternative lenders to turn to when they are in need of emergency cash. If states, like Ohio, restrict payday lending, consumers are sure to suffer and people are going to needlessly lose their jobs. Makes you wonder just who the CFPB and other groups against free market concepts are really trying to protect.

 

Payday Lending Restrictions will harm Lower Income American Households

It is no secret that the mainstream media and some government watchdog groups seem to loathe the payday lending industry. If you believed everything that got reported on this industry, you might think that there is no reason for it to be in existence. However, that would fly in the face of the fact that millions (some say 10 to 12 million) of people every year rely on payday loans. The Consumer Financial Protection Bureau recently proposed some rules that they say will help to protect consumers from the potential pitfalls of payday loans. Opponents of payday lending have applauded these new rules, but the elephant in the room is the fact that the new rules may wind up hurting the very consumers that they were supposedly created to protect.Banks Are Offering Payday Loan Type Services

The CFPB has never come out and demanded that the payday lending industry go away completely. But the new rules are based on extensive underwriting for the loans; essentially forcing lenders to do extra leg work to make sure that consumers are able to pay back the loans that they take out. The additional checks and balances that payday lenders will have to go through in order to make loans will likely result in many of them being unable to afford to stay in business.

Some crafty investors are working on their own versions of payday loans to swoop in and snatch up their share of the growing number of people who demand short term, small dollar loans. Uber recently announced that it will allow its drivers to get payday advances of up to $1,000 against their paychecks. The money will be paid back directly from the drivers’ pay checks. And Uber is not the only company that is cooking up new ways to offer services that look a heck of a lot like traditional payday loans.

The CFPB has done what the government is known for doing from time to time. They have stepped in to put new regulations on an industry that is already undergoing massive transformations. And if the CFPB gets its way, the new rules will more than likely limit the options available to poor people. All the while similar financial services and products will become more available to middle class households. It is a reversal of fortunes that should never take place, and one that could have lasting negative impacts on lower income households for decades to come.

The CFPB has come right out and said that the new rules will raise costs for lenders and that they will ultimately lead to a reduction of total loan volume by more than 50 percent. So, the money that would have been lent to lower income consumers (higher risk borrowers) will more than likely end up in the wallets of people who have higher incomes (lower risk borrowers.) Anytime an aspect of lending is regulated the lenders will react by enacting new prices in their loan contracts. They have to account for the increased risk/cost somewhere, right?

They say that bad things tend to roll downhill. The poor in this country know this fact all too well. Unfortunately, it is usually the government who is causing the lack of fortunate financial circumstances that millions of people must contend with. The new rules being proposed by the CFPB are just another example of how a government agency can act on the “behalf” of a group of people and wind up making things even worse on that group of people in the process.

Consumer Financial Protection Bureau looks to be Further Complicating Consumer Complaint Process

It looks like the CFPB is looking to add another layer of complexity to its customer dispute/complaint process. When this change goes through, consumers will have to wade through a two part online process that will ask consumers to give a rating to how a company handles complaints and to even log a wordy description that supports their dispute.

The CFPB is looking to get comments from the public about a recent request that came in as part of the Paperwork Reduction Act. This request would give people the chance to submit feedback on how the companies they are logging disputes against handle complaints internally. The Bureau plan on doing this with the addition of a survey and a free text section which allows consumers to describe their experience prior to the closing of a complaint.Consumer Financial Protection Bureau

The agency gave notice of this the first week of August. As of now, it is being called the Company Response Survey. It is slated to take the place of the dispute function that is currently in use and allows people to submit positive or negative feedback while they are filing complaints. The feedback will be looked at and any personal information will be removed prior to it getting officially published on the complaint database that the CFPB currently oversees.

This survey will ask consumers to rate how the company handles complaints via a one to five scale, while also including an opportunity for people to describe why they are giving the rating that they are. The CFPB published a Federal Register notice that stated, “Positive feedback about the company’s handling of the consumer’s complaint would be reflected by both high satisfaction scores and by the narrative in support of the score. Negative feedback about the company’s handling of the consumer’s complaint would be better supported and more useful to companies than the current ’dispute’ function.”

The CFPB will share the performance feedback information with the companies that respond to complaints to defend/represent its complaint handling process. Additionally, the CFPB will use this information to provide information to enforcement, supervisory and regulatory work that has a relation to the consumer financial products and services industry. The CFPB said that this survey is building on the foundation of a request that was submitted in 2015, and that it will allow the agency to stay centered on “… ways to highlight consumers’ positive experiences with financial service providers.”

The original CFPB consumer complaint database was launched to the public in 2012. The Bureau officially added complaints about debt collection to the database the following year. In the summer of 2015, they added complaint narratives to the growing database. This feature lets consumers share the experiences that they have had by using their own words. Since the database has been publicly available, debt collection companies have been the entities that seem to respond to the most complaints quickly. The CFPB published data that indicated that debt collection companies responded to about 93 percent of complaints logged in a timely manner.

It is worth noting that mortgage company complaints and complaints about credit card companies have made up a bulk of the consumer disputes received so far. Alternative financial service complaints have been few and far between. This is worth being aware of, being as the CFPB has seemed to focus a lot of its efforts on policing providers of alternative financial services, when it seems to be the traditional financial institutions that have generated the most complaints from consumers since the official launching of this database.