Many Borrowers Still Feel ‘Threatened’ By Debt Collectors, CFPB Says

The Consumer Financial Protection Bureau (CFPB) recently released the results of a survey showing that one in four consumers feels “threatened” by debt collectors when they call.

Although most of the complaints covered in the survey are tied to efforts to collect on credit card debt, student loans, medical bills and auto loans, some are tied to efforts to collect on late or defaulted mortgages.

The survey – which was conducted from December 2014 to March 2015 – reveals that of those consumers who had recently been contacted by a debt collector, 27% felt “threatened” during the most recent interaction.

However, the term “threatened” can be somewhat open to interpretation: The CFPB’s survey reveals that many debt collectors are not following the regulations in terms of procedure – but things gets a little more gray when it comes to determining the actual degree of verbal “threatening” collectors are doing.

Borrowers are not asked about specifics such as the verbiage used or the tone of the debt collector when contacted. Rather, the survey has more to do with debt collectors contacting borrowers too frequently or at the wrong times.

For example, 37% of consumers reported that a debt collector had attempted to contact them four or more times per week. About 20% reported that they have been contacted four to seven times per week, and about 17% said they had been contacted eight or more times per week.

About 36% reported being contacted during 9 p.m. and 8 a.m. As the CFPB points out in its release, debt collectors generally cannot call at times they know to be inconvenient unless the consumer specifically agrees to it.

In addition, about 40% of borrowers reported that a debt collector continued to contact them even after the borrower asked the debt collector or creditor to stop contacting them. The CFPB points out that debt collectors must honor consumer requests to cease collection attempts.

Interestingly, but perhaps not pertinent to mortgage collections, 53% of consumers who were contacted about a debt said the collection effort was mistaken in some way – the creditor or collector sought the incorrect amount, the debt was not owed, or the person owing the debt was a family member.

For more, click here.

LEAVE A REPLY

Please enter your comment!
Please enter your name here