The CFPB has released its first in-depth report analyzing complaint submission patterns throughout the credit life cycle, by demographic characteristics.

The findings are based on the approximately 1 million consumer complaints that were submitted to the CFPB between 2018 and 2020. To prepare the report, the CFPB matched address information from complaints to census tracts.  The credit life cycle categories used for the Bureau’s findings are loan origination, servicing of performing loans (performing servicing), delinquent and distressed servicing and collections (delinquent servicing), and credit reporting.

Key findings include the following:

• Census tracts with the greatest share of Black or African American residents submit the most complaints per resident.
• Lower income census tracts and census tracts with a greater share of minority residents submit more complaints about credit reporting, delinquent servicing, and identity theft.
• For communities with relatively high incomes, complaints about originations and performing servicing are relatively more common and complaints about credit reporting and delinquent servicing are relatively less common.
• Census tracts with the highest share of white, non-Hispanic residents submit complaints about loan originations at more than twice the rate as census tracts with the highest share of Black or African American residents.
• Lower income census tracts (those at or below 40% of their area’s median income) submit about 30% more complaints per resident than census tracts at about 100% of their area’s median income.

Based on these findings, the CFPB makes the following observations:

• Consumers from communities with lower incomes and higher shares of Black or African American residents and Hispanic or Latino residents submit complaints about past financial issues and identity theft victimization.  In contrast, communities with higher incomes and a greater share of white, non-Hispanic residents tend to submit complaints about current issues they are having with lenders and servicers.
• The different experiences of these communities suggest that structural differences in access to credit are important in determining what kinds of complaints the CFPB receives.  The submission of complaints about loan origination by white, non-Hispanic consumers at more than twice the rate of Black or African American consumers likely reflects differences in access to credit, with differences in complaints about mortgages playing an outsized role.
• Past barriers limiting access to mainstream credit for racial minorities, the long-term impact of the 2008 mortgage crisis, and continued inequality in access continues to shape the opportunities available to consumers.
• The growing gap between communities with higher white, non-Hispanic populations and/or higher incomes and communities with higher minority populations and/or lower incomes is especially concerning.  It suggests that new credit, especially mortgages and mortgage refinances, may be disproportionately available to consumers from communities with higher incomes and a greater share of white, non-Hispanic residents.