The rule, required by the 2010 Dodd-Frank financial oversight law, would establish minimum underwriting standards for most mortgages and is intended to combat home lending abuses that contributed to the 2007-2009 financial crisis.

The rule was originally being written by the Federal Reserve, which issued an initial proposal earlier this year. The consumer bureau, however, took over the process when it opened its doors for business on July 21.

"We plan to issue a final rule early next year in order to provide clarity to the market as quickly as we can, without sacrificing the quality of our analysis," Raj Date, the Treasury Department official running the bureau, said in remarks prepared for delivery at a conference sponsored by the American Banker.

A key issue is what type of legal protections lenders will receive if they offer straightforward loans -- such as those without interest-only payments and excessive fees -- defined by the rule.

Banks are pushing for full legal protection, a "safe harbor," while consumer advocates want borrowers to have at least some legal recourse if they feel a lender did not meet the standards laid out in the rule.

(Reporting by Dave Clarke in Washington; Editing by Lisa Von Ahn)