by Calculated Risk on 1/26/2006 01:14:00 AM

In December the FDIC, Office of the Comptroller, the Federal Reserve and other agencies issued a new proposed guidance on nontraditional mortgage products.

Now Reuters reports: US banks seek more mortgage proposal comment time

Lenders this week asked U.S. regulators to extend a comment period on a proposal that urged tighter underwriting on new mortgage products that may pose greater risks for banks and borrowers as interest rates rise.

Comments were due Feb. 27, but lenders have asked the Federal Reserve and other regulators for 30 more days.

"The proposal is extremely complex and has far-reaching consequences for our members, as well as for the nation's mortgage markets," wrote Janet Frank, director of mortgage finance in America's Community Bankers' government relations office.

"We believe that it will take an additional 30 days to complete the necessary evaluation and collect comments and data from our membership," Frank told regulators in a letter.

The Consumer Mortgage Coalition and HSBC North America Holdings Inc. also requested an additional 30 days.

Spokesmen for the Fed and Office of the Comptroller of the Currency were not immediately available to comment.