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Lenders and brokers already changing with CFPB complaint database

April 15, 2013

The Consumer Financial Protection Bureau recently began publishing consumers' complaints about all types of lending issues, including those for mortgages. In turn, this seems to already be leading to more prompt service when such issues now arise, according to a report from Bloomberg Businessweek.

Now, many lenders and other nonbank financial institutions are reacting very quickly to any complaints they receive from the consumer watchdog, even as the agency itself does not verify the claims consumers make against these entities, but rather logs them and passes them along.

Once an institution receives a consumer complaint they have 15 days to confirm that it came from an actual customer, at which point it is published online, the report said. The CFPB decided to do this so that it would spur lenders to action in dealing with the problems, and that has certainly been the case recently. The average response time in dealing with complaints is already up 3 percent, and a larger number of lenders are now more frequently ruling in consumers' favor, with such decisions related to credit card debts - the first to be listed on the complaint database - up 12.9 percent in the last six months.

Therefore, it may be likewise reasonable to expect that mortgage professionals will likely be similarly proactive in dealing with outstanding balances for which they have received complaints through the CFPB, the report said. Many may already be working on developing ways to avoid these issues from arising in the first place, and also to give themselves a bit of a leg up on others in the field.

"They want to nip it in the bud before it becomes a lawsuit," Steven Ramirez, chief executive officer of the data-mining consulting firm Beyond the Arc, told the news agency. "For the first time, the companies have a benchmark to compare themselves to their competitors. Previously, they were acting in a vacuum."

In this new regulatory climate, mortgage professionals will need to be more cognizant going forward of all the rule changes that will necessarily affect their companies overall. Moreover, they may also need to consider how they can best use the information now available to them to better serve their customers and potentially increase business going forward. Doing so will help keep them on the right side of state and federal rules, as well as continue to better serve their clients.




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