Quick Hit Ellyn Fortino Thursday July 16th, 2015, 3:28pm

Illinoisans File Thousands Of Mortgage Complaints To Consumer Watchdog Agency

Mortgages continue to be the most griped-about issue to the Consumer Financial Protection Bureau (CFPB), and Illinoisans have submitted thousands of complaints to the consumer watchdog agency, a new report by the Illinois PIRG Education Fund shows.

The group analyzed CFPB's public Consumer Complaints Database, which collects consumer grievances about 11 different financial products and services.

CFPB has received over 138,000 consumer complaints about mortgage problems since it began collecting the information in December 2011 through March 16 of this year, according to the report. Mortgage issues represent 38 percent of all consumer complaints in CFPB's database.

Illinoisans have lodged 4,437 mortgage complaints with the CFPB -- the 9th highest amount in the U.S.

Overall, Bank of America received the most complaints, garnering over 31,000 CFPB mortgage grievances. Wells Fargo had the second highest amount of mortgage complaints at more than 19,000.

Consumers in Illinois, plus 44 other states and the District of Columbia, filed the most mortgage grievances against Bank of America. In the five remaining states, Wells Fargo was the company that saw the most complaints.

Although annual mortgage complaints to CFPB dropped 13 percent in 2014 to about 43,000, mortgages remain the largest source of consumer complaints to the agency, the report showed.

Debt collection came in behind mortgages as the No. 2 problem issue last year with over 39,000 complaints. CFPB has also received tens of thousands of consumer grievances involving credit reporting, credit cards and bank services.

Most CFPB mortgage complaints, 55 percent, involved "problems when consumers are unable to pay" based on loan modification, collection and foreclosure issues, according to the report. Problems with payments, loan servicing and escrow accounts accounted for 30 percent of the mortgage complaints.

Bob Palmer, policy director at Housing Action Illinois, weighed in on the report's findings.

"The data in the report shows that many homeowners struggling to avoid foreclosure continue to have difficulties getting clear and timely responses from their lender or loan servicer regarding requests for loan modifications and other issues," he said in a statement. "The ability to submit a complaint against a company through the CPFB is an important resource to assist homeowners in their efforts to maintain their homes."

More than 14,700 consumers who had mortgage problems got either monetary or non-monetary relief via CFPB's complaint process, according to the report.

Illinois PIRG Education Fund Director Abe Scarr highlighted one Illinois family's success in getting monetary relief.

"Imagine that your loan is purchased from your original lender by another firm, who then fails to record your on-time payments and does not fix their error despite you providing them their own reference number and your bank statements to confirm the payments - and then, they raise your payments despite their multiple errors," he explained. "This happened to an Illinois family, who received monetary relief after submitting their complaint to the CFPB. Consumers need a strong CFPB that reins in reckless mortgage companies who ignore the rules."

CPFB was established in 2010 with the task of regulating reforms set in the Dodd-Frank Wall Street Reform and Consumer Protection Act. The agency formally launched on July 21, 2011.

"Before the CFPB was created, victims of mortgage errors like misapplied payments and incorrect late fees were at the mercy of the banks," Scarr noted. "Now, we have a cop on the beat."

But there is room to improve CPFB's database and complaint process, the report says.

According to the Illinois PIRG Education Fund, the CFPB should include subsidiary company information in its database and ramp up consumer outreach and education about its complaint process, among other recommendations.

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