Cannabis in the home
Updated: Aug 20, 2019
As of October 17, 2018, Canada became the second country in the world to legalize cannabis for medical and recreational purposes.
As a mortgage broker, we always have clients coming to us for refinancing advice on their current mortgages. Prior to October 17, 2018 growing cannabis at home was a grey area as you could grow it for yourself for medicinal purposes and only with a license from your doctor.
Mortgage wise it was a huge red flag and lenders would typically not lend on a property used in the growing of marijuana/cannabis.
"The presence of a single legal marijuana plant could lead your home insurer to deny your claim" . - Gord McGuire contributed to the Globe and Mail published April 3, 2019
No home insurance means you are in default of your mortgage.
What does this mean for you, the home owner? When refinancing with a new lender an appraisal is always required. Sometimes we have private lenders where we can make an exception but then there will always be a site visit either by the lender themselves or a delegate. If an appraiser notices marijuana/cannabis plants in the home or on the property, they can disclose on their appraisal report that marijuana/cannabis plants are present on the property or within the home which could place your property or home on a list that makes it very difficult to finance or the lender can decide they do not want to finance your home.
We have not received any communiques from the mortgage industry regarding this and we are still waiting to hear. Our thoughts are that should you have marijuana/cannabis plants in the home, the plants should be treated like bottles of alcohol and be kept discreet. After all, they are no longer illegal.