What You’ll Learn
- Get answers to some common cannabis home loan questions, including: how do cannabis industry professionals get a mortgage?
If you own a cannabis business, or work for one, your journey to homeownership might involve some unique challenges. However, this doesn’t mean owning a home is out of reach. In this article, we’ll tackle some of the most common questions about securing a home loan when you earn your living in the cannabis industry.
Why is it more difficult to get a home loan when you work in the cannabis industry?
Traditional banks, bound by federal regulations, often hesitate to extend basic banking services, let alone mortgages, to those employed in the industry.
Many national banks, owing to federal regulations, remain hesitant to offer even basic banking services to cannabis businesses and employees. This hesitation isn’t due to poor credit or insufficient funds but is tied to the industry’s unique regulatory environment. The unfortunate outcome is a financial exclusion that impacts not only business banking but also personal financial milestones, such as homeownership.
Even today, with recreational cannabis legalized in over 20 states, many national banks remain hesitant to offer even basic banking services to cannabis businesses and employees. Even fewer financial institutions are willing to offer a mortgage to someone who works in the cannabis industry. Why? Cannabis is still illegal at the federal level, and it is highly regulated in the states where it is legal. Because of this, banks and credit unions that serve the cannabis industry must follow stricter oversight and due diligence. Many financial institutions don’t want to take on the risk or higher the extra staff required to meet the significant compliance requirements.
Salal, on the other hand, has been a national leader in providing financial solutions for licensed and regulated cannabis businesses and their employees since 2014. We’ve partnered closely with state regulators to offer a full range of dependable banking services.
From business checking and savings to cash management solutions to equipment and commercial real estate loans, we take pride in helping cannabis businesses and their employees thrive.
Are cannabis professionals eligible for all types of home loans?
The short answer is no. Because you work in the cannabis industry, you might face limitations when it comes to eligibility for all types of home loans. Many traditional lenders may refuse to provide financial services, including home loans, to those who earn their income from the cannabis industry. You also might have difficulties securing government-backed loans, such as Federal Housing Administration (FHA) loans or loans backed by Fannie Mae and Freddie Mac. (See the answer to the question above.)
At Salal, we offer cannabis professionals both traditional and non-traditional home loans, including options for jumbo loans if you are looking to buy in an area with higher-than-average home prices.
What is different about the Salal mortgage application and approval process for people in the cannabis industry?
At Salal, the process isn’t that different from that of any other homebuyer. Along with our usual pre-approval requirements, we do ask for documentation of two years of work history. And if you are self-employed, you need to show two years of filed business tax returns. Like all borrowers, you will need to eligible for Salal Credit Union membership.
Does Salal Home Lending offer any perks for cannabis industry members?
Yes. Anyone who works in the cannabis industry and gets their home loan from Salal gets $1,000 off their closing costs. This applies to a home purchase or a refinancing. All Salal members (and even homebuyers who aren’t members) also have access to HomeAdvantage. It’s a free service that includes a wide range of house-hunting tools that can help you shop for homes, do research on the area you want to move to, estimate your future mortgage payments, and even earn Cash Rewards* when you buy or sell a home when you work with an agent in the HomeAdvatage network.
As a cannabis industry professional, how can I learn more about getting a home loan and get my questions answered?
Salal Home Lending is proud to offer home loans to the cannabis industry and we’re here to help. A great place to start is to schedule a Homebuyer Planning Session. The session is free and there is no obligation on your part. You’ll get to meet with a Salal Mortgage Advisor, either in-person or virtually. You’ll walk away from the meeting with a better understanding of the application process, how much house you can afford, what your future mortgage payments might look like, and any other questions you might have.