The Mortgage Bankers Association of America said it has commitments of $100,000 each from Fannie Mae and Freddie Mac to help fund its year-2000 readiness testing program.
The mortgage industry is seen as particularly vulnerable to the millennium bug because of its heavy use of dates in interest calculations.
Many mortgage companies have developed fail-safe systems and tested them internally. The MBA's voluntary tests are designed to make sure these systems are compatible with each other. Lenders will enter detailed data on fictional loans into their systems and then set the computers to 2000 and see how they react.
The testing is to start early next year. Software vendor Alltel Inc. and title insurer First American Real Estate Services have also made $100,000 commitments.