SPOKANE, Wash.-Credit unions have always prided themselves on knowing their markets and communities. But that's just not enough when it comes to planning for 2012, according to one person.
Dave Chiappe, COO for Sharper Lending, which offers its Appraisal Firewall products to mortgage lenders, said that the additional reporting requirements of Dodd-Frank are going to force CUs to consider hiring or assigning a full-time compliance person.
"You need someone dedicated to keeping up with changes in lending," Chiappe offered as an example. "Take a credit report: we've seen changes to what's required on a credit report two or three times already this year."
For that reason, he urged credit unions to get onboard someone "who's keeping up on these things so that [CUs] don't end up doing something that may make them liable in the future."
Comparing his predictions for 2012 to what he might have hoped for 2011, Chiappe said that the Fed's "quantitative easing" has not turned out as many had hoped, and the economy has remained stagnant.
That will only make for even tougher choices for 2012, according to Chiappe.
"That's why the lean-and-mean, compliance-oriented credit union is going to be successful-or as successful as they can be," he said.
"I don't personally see things turning around until 2015, and then I expect us to go into a normalized market, not a market where consumers are able to spend based on this irrational growth in equity in their homes."
And as consumers and financial institutions get used to that sense of the "new normal," he said, learning to play by the new rules will be crucial.
"Two years ago I would have been harping more on the efficiency side of things, but because of the overwhelming nature of Dodd-Frank, [compliance] can be unbelievably burdensome," he told Credit Union Journal.
