Colorado, Cannabis Industry & Getting Approved

[Blake Hrabal]

It's 2020, Colorado, a thriving legal rec marijuana state. I am the Facilities Director of an indoor & greenhouse recreational marijuana grow op. I'm W2 salary employee around $80k/yr. Been with the company for almost 3 years. FICO score is 700.

I love my job and it pays me alright for now. I'm secure; roof over our head, food on table, wife/kids enjoy minor luxuries here n there, school activies etc, and while saving 15-20% income each month. 

With that said, I'm not trying to be just comfy forever and that's why the last 6 months I've been really digging deep into learning about REI so I can make it a side hustle that one day I can maybe quit my job off eventually.

So, that was the skinny - now...I feel I'm on the right track for saving for a downpayment n closing costs...I have been doing my research as to which strategies I wanna approach and execute on....I guess now that things seem to be going smooth and it's just a matter of time/saving til I can get my start in REI....that...

I'm worried when I actually have the money for the downpayment and I go to vet lenders, that the lenders are going to deny me due to the industry that I legally make my living in. I've heard stories in the past of other industry employees getting rejected and having to find private lenders etc, however, that was 2015-2018...and now in 2020 the industry is steamrolling forward in rapid growth, so more and more cannabis industry workers on W2 must be applying for home loans, especially out in CO.  I'm wondering if right off the bat, I should stay away from big banks like Wells Fargo (my primary bank) and not waste my time. 

I bring this to the BP RE Professionals discussion, to hear about your experiences and opinions with this directly! 

[John Collins]

Are you high right now? That's what lenders are thinking.

As someone who warned people about "vaping" and how the vape industry would crash due to health issues 5 years ago, I have no problem lending to legit marijuana operations in legalized states. 

I do think marijuana is a short feel good high to cover up people's inability to deal with actual issues but it sure as hell beats Pharma. 

The guys who approve loans in banks agree with me - it's no longer seen as illegitimate or unsustainable. They seriously question whether people can remain productive while smoking though, so there will be bureacracy you have to deal with when people in these legalized states are figuring things out. But until then it will always be a case by case basis with no generalized consensus. I have received dramatically different responses from different BRANCHES of the same bank! 

I would already start talking with local and large banks about what percentages you can get at what down payment - I saved for 10 years before jumping into real estate and couldn't have done it without the savings. The larger downpayments and high credit helped me set comfortable rent rates and maintain a cash flow.