CFPB Research Leaves Out One Thing: Talking To The Consumers

The Consumer Financial Protection Bureau last week released a report on professional designations earned and represented by those who work with older Americans. The study concluded consumers were confused by the dozens of designations being used in the marketplace. While the CFPB conducted thorough research on the subject including insight from experts and stakeholders, the bureau didn’t actually speak with consumers for the study, RMD has found.

A similar outcome came from a reverse mortgage industry report mandated by Congress under the Dodd-Frank Act and produced by the CFPB last year. While the study presented one of the most thorough industry reports of the reverse mortgage business in the history of reverse mortgages, the lack of consumer input left some questioning the validity of the study.

“We did not conduct a direct to consumer survey,” a CFPB official said at the time last year. “[The report] was a very large undertaking as it was, to add a direct to consumer survey would’ve added months to the process.”

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In the most recent report on senior designations, the CFPB had a similar response when asked about the research methodology. While consumers did submit comments to the agency’s request for information and there were a small number included in roundtables hosted by the CFPB, there were not any formal interviews with consumers.

“…The Bureau found that the use of senior designations is extremely confusing for consumers,” the bureau wrote in its report. “There are more than 50 different senior designations currently used in today’s marketplace with senior designees recommending or selling a variety of products, such as securities, investment opportunities, financial products, and insurance products like annuities and long-term care insurance.”

In response to the findings, the agency says it will work to streamline designations by working with state and federal enforcement and accreditation organizations.

Written by Elizabeth Ecker

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  • “We did not conduct a direct to consumer survey,” a CFPB official said at the time last year. “[The report] was a very large undertaking as it was, to add a direct to consumer survey would’ve added months to the process.” If you want to know the truth you have to ask for it. It never works to make it up. Is this industry going to let CFPB off the hook, congress, the president? Do today’s seniors (borrowers) deserve anything less???

    • wstrycker,

      And, oh, yeah will we let the Mayor of Boston off the hook and Boston Animal Control and Boston Parking Control and … and … and … and (lest we forget) the United States Supreme Court, Courts of Appeal, and District Courts?

      How about just surveying the 10% of HECM borrowers who are currently in default? You probably would not like the results!!!

  • “… the study presented one of the most thorough industry reports of the reverse mortgage business in the history of reverse mortgage …”? Really? How can the report be considered “thorough” when it did not include actual consumer input?

    • Atare,

      Hopefully one of the major organizations will create a “more thorough” report which will include a survey based on the entire HECM population.

      The Credibility/Ohio State University survey is very, very suspect since it has been indicated the only borrowers in the pool are those from the very limited Credibility pool of counselees. That means less than 3% of all HECM borrowers have any chance at all of being selected. While the stats MAY have application to the Credibility counseled borrowers, it MAY have far less applicability to the entire population of some 1,100,000 HECM borrowers since inception of the program.

      The survey should be a joint project between FHA/HUD and the CFPB research staff. Will that happen?

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