Rhode Island Cultivator Loses Already-Approved Mortgage After Bank Gets Spooked By Sessions

Mr. and Mrs. Guardarramas

Based on sheer Facebook bragging value alone, becoming a homeowner ranks just behind getting engaged and baby photos (which is tied with getting a new puppy).


So, you can only imagine how heart-wrenching it must be to think you have your mortgage all wrapped up and approved, a new home of your own within sight, just to have it ripped out from under you by the bank. Even worse, they reason they reversed their decision was because you work in the legal medical marijuana industry, but because of Jeff Sessions-induced fear and federal backing of the loan, you’re out of luck.

For one Rhode Island couple, this nightmare became reality.


Purchasing a house is an important event in a person’s life, partly due to how difficult and stressful the process can be to complete. John and Melissa Guardarrama received approval from Home Loan Investment for their new home in Pawtucket, Rhode Island in 2017. Then, on Jan. 8, John received a letter from the mortgage company detailing the reasons his loan decision had been reversed. The reasoning lied with his income source and line of employment, according to Go Local Providence.

Guardarrama is a cannabis cultivator employed by Summit Compassion Center, and Melissa claims the mortgage lender knew about John’s employer for months.


“[Home Loan] had all his income information as of last summer, they knew then where he worked,” said Guardarrama of her husband’s loan. “How do I tell my daughters if you work hard, you can get what you want, and then this happens?”


The hopeful homeowners picked suburban Pawtucket for its inclusion in the Ocean State’s first time home buyer assistance program.


Though representatives from Rhode Island Housing couldn’t comment on a specific loan application or decision, assistant deputy director for policy and research Christine Hunsinger did say, “Regarding compassion center workers, most of our loans are FHA (Federal Housing Administration) loans, which must comply with their underwriting guidelines. FHA will not purchase or invest in a loan where the borrower is employed by or receives compensation related to the marijuana industry.”


Summit is one of three legal compassion centers in the state.


After garnering a loan approval in July from the lender, Melissa said things changed around the time Attorney General Jeff Sessions announced a shift in focus of enforcement for our nation’s prosecutors that would see cannabis markets — legal or otherwise — fall back into the leering sights of the Department of Justice.


“Fast forward to November. We paid for the inspection, we paid for the contract. All we had in front of us was the closing,” said Guardarrama.


“The way it works, you get the pre-approval from Home Loan. Then, when you submit everything — when you have the home — Home Loan submits it to RI Housing. We spent the money on the first time homeowners test online. We signed the purchase and sales agreement,” said Guardarrama. “We were going to close on January 19.”


This isn’t an isolated incident and situations like this are happening all over the country.


“We just want people to know [this happened],” said Guardarrama.

In Oregon, where cannabis is legalized for adult-use in addition to medical purposes, loan decisions have also been reversed or called into question because of an applicant’s employment in the legal weed industry.

Melissa Johnson, who bought a used Kia Soul at a dealership in Bend, Oregon, had to bring the car back after having it for a week when the sales staff told her the loan was denied because she works for a retail dispensary.

If this is the case for anyone working in the weed industry, it could be a major thorn in the side of both consumers and businesses trying to lend.

The Oregon Liquor Control Commission, which provides oversight on the state’s legal marijuana industry, estimates that more than 13,000 workers have been granted approval for their marijuana-worker permit, required to be employed at a cannabis-related business. More than 10,000 people in Oregon alone could be blocked from owning cars or homes or sending their children to college. One fairly 

successful workaround for some people is banking with a credit union — a local institution not so tightly bound by federally-insured funds.

Bring it Home, poster for at home cannabis use and cultivation.

As far as legal rights that protect the consumer, there aren’t many. In 2011, the Department of Housing and Urban Development (HUD) issued a memo reminding people in states with legal cannabis in any form that landlords or Public Housing Authorities were under no legal requirement to accommodate medical marijuana users or growers.

DCMJ, an advocacy group fighting for the rights of cannabis users in our nation’s capitol and beyond, is holding three National Days of Action this week (tomorrow, April 4, is the final day). The first demonstration 

on Monday was for HUD Action, recognizing that “adults receiving government assistance for their housing can be evicted from their homes for the possession, use, and cultivation of cannabis.”



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