Federal Agencies Team Up to Help Workers Make Smarter Retirement Decisions

Workers are often confused about Social Security, which can lead them to shortchange themselves later when claiming benefits. A new report by the Consumer Financial Protection Bureau (CFPB) cites studies that find only 1 in 5 preretirees know their full retirement age for Social Security. (For anyone born after 1942, the age is 66 to 67 years old.) And only 1 in 8 understand how benefits would change if they claimed them before, at or after their full retirement age. Simple …

Get the Latest Dirt on Your Bank

How well does your financial institution treat its customers? You can now find out by going to the Consumer Financial Protection Bureau’s Consumer Complaint Database. There you can read in the customers’ own words about their problems with financial products and services, and how the institutions offering them responded — or not. It’s sort of like Yelp for banks. The agency has been collecting complaints about financial service companies since 2011, and it has received more than 627,000 so far. …

CFPB: Reverse Mortgage Ads Can Confuse More Than Inform

Advertisements touting reverse mortgages often leave older consumers confused about the loan terms and unaware of the risks, according to a new report from the Consumer Financial Protection Bureau. “Perhaps most concerning of all, the ads left the consumers believing that if they purchase a reverse mortgage loan, they will be able to rest assured that they can live in their homes and enjoy financial security for the rest of their lives,” CFPB Director Richard Cordray said in a teleconference. …

Consumer Agency May Clamp Down on Payday Lenders

The Consumer Financial Protection Bureau (CFPB) is proposing new rules to restrict high-cost payday and car-title loans that often leave borrowers in worse financial shape. The agency can’t do anything about the interest rates charged — that’s up to the states — although it does have the authority to regulate the lenders making these loans. “Too many short-term and longer-term loans are made based on the lender’s ability to collect and not on a borrower’s ability to repay,” CFPB Director Richard Cordray …

Arbitration Clauses for Credit Cards, Other Services May Harm Consumers

Millions of consumers may not be getting a fair resolution in disputes with their financial institutions over products and services, according to a report released Tuesday by the Consumer Financial Protection Bureau. The CFPB examined the arbitration clauses in contracts for credit cards, prepaid cards, private student loans, payday loans, cellphone service and checking accounts. These clauses generally permit companies to resolve consumer complaints using arbitration. Most bar consumers from filing class-action suits, which may provide a fairer and more …

Surprise! Reverse Mortgages Are Very Confusing

A three-year examination of reverse mortgage complaints to the Consumer Financial Protection Bureau shows that borrowers often didn’t understand the terms of those loans, including how quickly their loan balances would go up and their home equity would fall, the bureau said in a new report. Reverse mortgages allow homeowners age 62 and older to tap into the equity in their homes. They’re different from home equity credit lines or home equity loans because a reverse mortgage generally is paid back only when the homeowner …