ABA objected to the Consumer Financial Protection Bureau’s rushed implementation period for the Ability-to-Repay/Qualified Mortgage rule yesterday, warning that the hasty transition period may temporarily curtail mortgage credit.
“Many of our member banks report that vendors did not complete software updates until the very end of 2013, leaving no time to test products and train staff,” ABA said in a statement for the record at a House Financial Services subcommittee hearing on QM. “As the Affordable Care Act rollout has demonstrated, big software upgrades are not simple and require a great deal of debugging. Rushing them only harms consumers.”
Although CFPB Director Richard Cordray has told bankers that the bureau is “not going to expect perfection” if “good-faith” efforts are made to come into compliance, ABA noted that bankers “cannot point to verbal assurances when examiners ask about imperfect compliance, and such assurances carry no weight in court if a bank is sued by a borrower or a state’s attorney general.”
“Banks very much want and need to comply with the laws and regulations governing them, and if they have doubts over their ability to do so, they are likely to be more cautious in lending until they know they can comply,” ABA added.
Read the statement from ABA.