On May 31, 2017, the Consumer Financial Protection Bureau (CFPB) issued its Monthly Complaint Report, this month’s complaints by consumers aged 62 and older. The CFPB drew its analysis of more than 103,100 complaints from its Complaint Database, which can be found here. The complaint report is an illuminating view into common issues older consumers feel they face in interacting with their financial institutions, and as such can be a helpful resource for entities interested in improving their customer service, especially for older segments of its customer base.
According to the report, the largest category of complaints from older consumers related to debt collection, followed by mortgages, and then credit reporting. Most of the complaints (nearly 25%) filed with the CFPB by older consumers came from California, Florida, and Texas. The report shows that these older consumers—a steadily growing market segment—are more likely than younger consumers to submit complaints to the CFPB regarding the following issues:
- Servicing problems with reverse mortgages. Reverse mortgages, which lenders provide only to consumers who are over 62 years old, provide an option for these older borrowers to borrow money against the value of their homes and receive periodic payments. Repayment of the mortgage is not required until the borrower passes away, moves, or sells the home. The CFPB study found that older consumers with reverse mortgages often reported servicing problems arising after a borrowing spouse dies. In extreme cases, the servicing problems led to foreclosure proceedings on the property.
- Difficulty recovering from financial scams. Older consumers, who are disproportionately the targets of financial scams and identity theft, filed complaints regarding difficulties they faced with correcting credit reports, disputing credit card charges, and succeeding in having money fraudulently withdrawn from their bank accounts returned to them.
- Confusion about deferred interest and zero-interest credit card offers. Older consumers also reported confusion over terms and conditions of credit cards. For example, they reported that they sometimes find it difficult to understand the difference between deferred-interest and zero-interest offers.
- Fees charged for unwanted add-on products and services. Finally, older consumers filed complaints about charges for services to which they did not consent. Some of the complaints indicated that the consumers were enrolled in programs such as credit monitoring without required disclosures about the programs or associated costs.
The report on common complaints by older consumers may be helpful to lenders who frequently engage with consumers over 62 years old, both because it highlights some of the common sources of customer dissatisfaction in that age group, and because it may point to some of the lender conduct the CFPB will be particularly aware of and on the lookout for going forward. As always, lenders and other consumer-facing institutions should review their policies and procedures to ensure that issues like the ones highlighted in the monthly report are not occurring at their institutions.