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What Were the Top Financial Complaints in Your State in 2016?

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What Were the Top Financial Complaints in Your State in 2016?

If you’ve found yourself in the middle of a financial fracas, you’re not alone. Consumers submitted more than 168,000 formal complaints with the Consumer Financial Protection Bureau during the first 11 months of 2016. Those complaints against banks, lenders and other companies are up 9.3% from the same period a year earlier.

A NerdWallet analysis of complaints from consumers across the U.S. about 11 financial products and services found they largely clustered around three: credit reporting, mortgages and debt collection. The CFPB said it wasn’t clear whether the upswing in complaints was caused by worsening conditions or greater consumer awareness of the U.S. government agency’s efforts.

 

Breaking it down by rate of complaints

Credit reporting

Credit reporting complaints predominated in 21 states, most of which are in the South or the Midwest. Of those, Georgia’s complaint rate of 25.2 records per 100,000 residents was the highest, while Arkansas’ rate of 6.0 per 100,000 was the lowest. In 15 of those states, credit reporting complaints accounted for at least one quarter of the total.

Nationwide, in instances when consumers cited a specific issue in their credit reporting complaints, incorrect information on a credit report was by far the most common problem (73.8% of complaints). The second-most prevalent issue was investigations by credit reporting companies (12.4% of complaints).

MortgageS

In 15 states and Washington, D.C., mortgage problems were the top concern. Of those, Washington, D.C.’s mortgage complaint rate of 32.6 per 100,000 people was the highest, while Wisconsin’s rate of 6.5 per 100,000 was the lowest. In Rhode Island, mortgage complaints made up 29.3% of all complaints, which was the highest percentage in any state. In seven other states, the share of mortgage complaints exceeded 25% of the total. In Minnesota, the state where mortgage complaints represented the smallest majority share, they still accounted for more than one fifth of all complaints.

Overall, 41.1% of mortgage complaints nationwide that called out specific issues cited problems with loan servicing, payments or escrow accounts. Almost as many — 39.6% — cited problems with loan modification, collection or foreclosure.

Debt collection

Debt collection garnered the most complaints in 13 states, many of which are located in the Midwest and Mountain West. In South Dakota, nearly three in 10 complaints this year were about debt collection. In Delaware, where this type of complaint’s majority was the smallest, the share was roughly two in 10. At 23.2 records per 100,000 residents, D.C.’s rate of debt collection complaints was the highest in the nation, while West Virginia’s rate of 3.9 per 100,000 people was the lowest.

Among consumers nationwide who cited specific debt collection issues, 40.9% pointed to companies’ continued attempts to collect debts that were not owed. About one in four cases (25.4%) involved issues about disclosure verification of debt. According to the CFPB, some examples of such issues are lack of timely notification and collectors’ failure to provide supporting documentation.

For a table view of the top complaints by state and the rate of complaints, click here.

Banking, credit cards

The overall number of complaints about bank accounts or services jumped to 18,845 this year, an increase of 23.9% compared with a year ago. However, the total number of complaints was relatively small compared with credit reporting (39,872), mortgages (36,680) and debt collection (34,915).

The state where banking complaints accounted for the highest share of overall complaints was Vermont (15.9%). In 22 states, bank complaints comprised less than 10% of the total.

Consumers nationwide who called out specific issues in their banking complaints cited the opening, closing or management of accounts 47.8% of the time. That’s almost double the share represented by the second-most common issue — deposits and withdrawals (24.3% of complaints).

Vermont was the only state this year where complaints about credit cards outnumbered those from any other category, comprising 17.2% of the total. That’s a decrease of almost 5 percentage points from 2015 levels.

Nationally, in cases where consumers mentioned a specific credit card issue, billing disputes accounted for the most (17.2% of complaints). Identity theft, fraud or embezzlement made up 11.5% of complaints.

The District of Columbia has the dubious distinction of having the highest rates of complaints in the country for 10 financial product categories. For three products — credit cards, bank accounts and services, and money transfers — D.C. had roughly twice as many complaints as the state in second place. In the case of student loans, D.C.’s rate of 13.8 complaints per 100,000 residents was more than triple that of runner-up Vermont, which had 4 complaints per 100,000.

Here’s a look at the top financial complaint for each state and the rate of complaints.

Top financial complaints per state

StateFinancial product2016 complaint rate per 100,000 residents
AlabamaCredit reporting11.13
AlaskaCredit reporting6.77
ArizonaDebt collection13.24
ArkansasCredit reporting6.01
CaliforniaMortgage15.65
ColoradoCredit reporting13.16
ConnecticutMortgage13.01
DelawareDebt collection17.23
District of ColumbiaMortgage32.58
FloridaCredit reporting23.88
GeorgiaCredit reporting25.22
HawaiiDebt collection10.34
IdahoCredit reporting9.12
IllinoisCredit reporting13.22
IndianaDebt collection7.43
IowaCredit reporting8.96
KansasDebt collection7.73
KentuckyCredit reporting7.37
LouisianaCredit reporting11.07
MaineMortgage9.03
MarylandMortgage22.39
MassachusettsMortgage11.47
MichiganCredit reporting8.98
MinnesotaMortgage7.43
MississippiCredit reporting8.15
MissouriCredit reporting9.21
MontanaDebt collection6.58
NebraskaDebt collection6.80
NevadaCredit reporting17.30
New HampshireMortgage11.57
New JerseyMortgage21.30
New MexicoCredit reporting15.11
New YorkMortgage13.67
North CarolinaCredit reporting11.31
North DakotaDebt collection5.55
OhioDebt collection10.05
OklahomaDebt collection8.49
OregonMortgage12.01
PennsylvaniaMortgage10.65
Rhode IslandMortgage11.83
South CarolinaCredit reporting12.77
South DakotaDebt collection7.69
TennesseeDebt collection11.53
TexasCredit reporting15.16
UtahMortgage8.14
VermontCredit card6.23
VirginiaCredit reporting16.27
WashingtonMortgage13.68
West VirginiaCredit reporting6.51
WisconsinMortgage6.53
WyomingDebt collection5.63

Caren Weiner Campbell is a staff writer at NerdWallet. Email: ccampbell@nerdwallet.com. Twitter: @ccampbell_nw.


METHODOLOGY

Complaint data are drawn from the CFPB database and are current as of Nov. 30, 2016. The time periods analyzed here are Jan. 1 to Nov. 30, 2016, and Jan. 1 to Nov. 30, 2015. Totals pertain to complaints from the 50 states and the District of Columbia, and exclude records from territories, commonwealths and overseas military addresses. To calculate per-capita complaint rates (per 100,000 residents), we used 2015 state population estimates from the U.S. Census Bureau.