with the mortgage bankers association holding its Annual Convention and Expo in Denver this year, it seemed fitting for our cover story to explore the housing finance implications of the legal cannabis industry.
Five years ago, Colorado and Washington became the first states to legalize recreational marijuana use. Since then, six more states have approved similar measures. And 21 other states allow medical marijuana use.
By all accounts, the emerging cannabis industry is booming and other states may implement their own variations of legalization. But for all the shifting attitudes toward the cannabis industry, its businesses and workers face considerable challenges participating in traditional financial services, including mortgages.
As our cover story explains, cannabis industry workers who pay taxes and can document their income through traditional means can’t get qualified for mortgages because their wages are derived from activity that’s considered illegal on the federal level.
Make no mistake; many of these wouldbe borrowers meet all the standard qualifications for a mortgage. The only thing holding them back from homeownership is where they work.
At a time when lenders are struggling to replace the refinance volume that’s fueled the industry for the past number of years by loosening standards for credit profiles and down payments, it’s odd that lenders and their investors haven’t found a way to serve consumers who work in the cannabis industry.
Regardless of your stance on the cannabis industry, this is a problem that’s not going away and will require a collaborative effort among many industry stakeholders to address. It’s my hope that this edition of NMN magazine will help encourage dialogue and debate on this topic in the coming months and years.
If you’re attending the MBA Annual in Denver, I hope you’ll take a moment to stop by our booth in the exhibit hall and say hello to our team. We’re always eager to meet new industry professionals, hear your feedback and learn about the latest trends and developments affecting your business.