The American Bankers Association is warning regulators that many banks will not be able to meet the January effective date for the qualified mortgage rule and they will need a transition period to complete the necessary system changes and train their employees.
Many banks are still waiting for their vendors to tell them when they will complete the system changes needed to comply with new mortgage rules, according to a survey ABA conducted in June.
“This survey confirms what we’ve been telling regulators and Congress all along: banks need more transition time to implement these mortgage rules,” said ABA executive vice president Robert Davis.
Since last spring, ABA has been urging the Consumer Financial Protection Bureau to delay the Jan. 10, 2014 effective date of the QM rule and other new mortgage rules so banks have more time to prepare.
The June survey discovered that 60% of vendors have not told their clients when they will provide all completed software and programming updates for the banks.
And 24% of banks don’t expect to receive all the materials from their vendors until November or later.
“Community banks in particular have indicated that updated software, programming and training are big concerns, and training can’t occur until systems are operational,” Davis said.