Move over, Yelp. The federal government’s top consumer agency has just begun allowing mortgage borrowers to vent publicly — in full narrative detail — about the bad experiences they’ve had with financial institutions.
Say your mortgage servicing company keeps harassing you with phone calls about the timeliness of your payments, even though you consistently send them within the “grace period” specified in the mortgage documents.
Or say your bank is proceeding to foreclose, even though you’ve been deep in negotiations to modify the terms of your loan. Not only does the bank inexplicably keep losing the documents you send them but every time you call to try to rectify the situation, you’re shifted to new personnel, none of whom seem competent or sympathetic. You want to tear your hair out, you’re so angry.
So here’s the good news: Now you can rant and rave about this poor service for all to see. The Consumer Financial Protection Bureau is boosting the firepower of its complaint system, opening it up to include the narrative details that consumers are often eager to share — if they just had a place to express them.
For several years, the bureau has run a national database where it posts complaints against banks, mortgage companies, student loan firms, credit agencies and other financial players. It’s been useful for many consumers, but the complaints it displays offer none of the sometimes harrowing details about what actually transpired. Instead, it’s rather dry and colorless: You get squeezed into a category — mortgage servicing complaint, problem with a reverse mortgage, whatever — but no one really gets a taste of the pain and frustration that you went through. The date of your complaint is noted along with your ZIP code, plus a brief description of whether the company resolved your problem.
Under the bureau’s’s expanded system, which went live March 19, consumers can opt to have their complaint narratives posted publicly, after the financial institution confirms that they are indeed customers. Your name and other personally identifying information will be scrubbed from the narrative before it ever goes online. Companies that are the subject of narratives will be able to respond — though only through the use of what the bureau calls “structured” options that capsulize what the company thinks about the allegations, rather than addressing your specifics point by point. Among other choices, companies can say they dispute the facts you present, or they believe the complaint to be the result of an isolated error, or they indicate that in the end, they acted appropriately. They can also decline to make a public response.
Bureau Director Richard Cordray said adding narratives to the existing complaint system should help “shed light on the full consumer perspective behind a complaint. Narratives humanize the problems consumers face in the marketplace.” Whether consumers opt to post a public narrative or not, they will still be able to avail themselves of the bureau’s ongoing service: Once they file a complaint with the bureau, companies will have to respond within 15 days and are expected to “close all but the most complicated complaints within 60 days.” The first batch of narratives are not expected to be posted for several months, allowing banks and others to gear up for this new feature.
Since inaugurating the complaint database system, the bureau has handled nearly 560,000 individual complaints. As of the end of June of last year, 34 percent of all complaints had to do with mortgages — the largest of any category, followed by debt collectors. Of mortgage complaints, 84 percent concerned problems with loan servicing — the handling of mortgage payments, escrows, transfers of accounts and modifications of loan terms, among other issues.
Financial industry groups are unhappy about the bureau’s plan to add narratives to complaints. David H. Stevens, president and CEO of the Mortgage Bankers Association, said it “doesn’t ensure that consumer complaints that the CFPB posts are valid (and) does not give financial institutions an equal opportunity to respond.” Richard Hunt, CEO and president of the Consumer Bankers Association, told me in an interview that the narratives amount to an unfair public “shaming” of banks with no verification by the bureau that consumer complaints are legitimate.
Bottom line: Your mortgage company or bank may not like it, but if you have a complaint and want to spell out what happened, the government is now ready to share your narrative. Just go to www.consumerfinance.gov and tell your story.
Kenneth R. Harney of the Washington Post Writers Group is a past member of the Federal Reserve Board’s Consumer Advisory Council and is currently on the board of directors of the National Association of Real Estate Editors.