CFPB Consumer Complaint Narratives: What They Say About Bankruptcy

The Consumer Financial Protection Bureau's consumer complaint database has contained narratives for over a year now. Each month, the CFPB publishes a report that summarizes the complaints received over the previous three months, and that focuses on a specific product and geographic area. (The latest report was published on August 31.) The higher-level summary offered by these reports is interesting and I have referenced them in class on occasion.

The consumer complaint narratives tell as interesting, but often different stories. However, they are harder to sort through systematically. In preparation for a symposium, I recently took a random sample of complaints with narratives published in the year period between May 2015 and April 2016. Having now read thousands of narratives, one trend stood out to me rather quickly -- narratives that talked about the consumer's prior bankruptcy or a relative's bankruptcy. About 5% of the narratives discuss bankruptcy.

Though not a huge percentage, this database is aimed toward people's complaints about financial products and services. Perhaps unsurprisingly, the most referenced product in conjunction with bankruptcy is credit reporting. But complaints about credit reporting companies amount to less than 1/3 of the complaints referencing bankruptcy. The rest primarily are about companies trying to collect on supposedly discharged debts: payday loans, various consumer loans, and debt collectors. All of which leads me to question -- to what extent are companies violating the discharge injunction; to what extent do consumers not understand which of their debts were discharged; and to what extent does having filed bankruptcy, and thus having taken legal action, predispose people to lodge a complaint in the CFPB database about their post-bankruptcy experiences?