medical marijuana.have some questions.

[hockey4848]

I am not an appraiser, but am getting one soon.

A family member has terminal brain cancer and I am their state registered caregiver, i have a permit to grow marijuana in my home with the state.

I bought the home 6 months a go under land contract, the contract is about to end and i need a mortgage. The house was built in 2010 and is in a "planned community". All the houses are pretty much the same.

I am in the construction business and built a 300 sqft completely sealed and insulated room in the 1600sqft basement of the home. Everything is beyond code and professionally done. Unless you walk into the actually room where the plants are you can not smell anything in the house or the basement. Due to the room being 100% sealed and insulated with mold resistant materials the rest of the home is protected from smell as well as mold or mildew that some people fear in having anything to do with homes where plants have been grown indoors. The ceiling, floor, as well as walls are 100% sealed off with mold resistant/sound resistant materials.

My city is compliant and i invited a city inspector to come check it out. He said he is seeing a lot of these since they passed the medical law in my state. Said he has yet to see one more professional then mine.

I am extremely worried about the appraisal and am unsure how to approach it. I have a few ideas to "hiding it" from the appraiser. But it is in my nature to be 100% up front and honest, so I am at a cross roads on my decision due to the importance of obtaining a mortgage for me and my family.

Thoughts?

 

[hastalavista]

"Hiding" stuff is not good as far as we appraisers go... it is reassuring to hear from borrowers (who do post about their concerns of not being forthright when they think they might have an issue) that many would rather disclose than keep secret.

The best advice will come from an appraiser in your state, but in general, I would say that if what you are doing is "legal" there isn't a reason to worry.
Have the permit ready for the appraiser so she/he can document it.

The rest is up to the lender. You could ask your loan officer if there is any reason why the lender would be concerned.

One disadvantage of trying to avoid disclosing such an item to the appraiser is this: Ideally, an appraiser walks through the entire improvement. On occasions, homes that I'm appraising will not have access to a room, detached building, or garage. In such cases, I note in the appraisal report that I could not observe the area due to X,Y,Z reasons. Maybe 33% of the time, the lender will require the borrower to make access available to me, and I then go back re-inspect. This obviously delays the loan and adds to the expense of the process.
So not disclosing could create the a delay in your process... a delay that sounds unnecessary to me.

Good luck!

 

[EddieB]

Legal and permitted, you should have no worries. I have other thoughts, but I imagine others here will have some experience and have better input.

I wish your family member comfort and healing.

 

[hockey4848]

"Hiding" stuff is not good as far as we appraisers go... it is reassuring to hear from borrowers (who do post about their concerns of not being forthright when they think they might have an issue) that many would rather disclose than keep secret.

The best advice will come from an appraiser in your state, but in general, I would say that if what you are doing is "legal" there isn't a reason to worry.
Have the permit ready for the appraiser so she/he can document it.

The rest is up to the lender. You could ask your loan officer if there is any reason why the lender would be concerned.

One disadvantage of trying to avoid disclosing such an item to the appraiser is this: Ideally, an appraiser walks through the entire improvement. On occasions, homes that I'm appraising will not have access to a room, detached building, or garage. In such cases, I note in the appraisal report that I could not observe the area due to X,Y,Z reasons. Maybe 33% of the time, the lender will require the borrower to make access available to me, and I then go back re-inspect. This obviously delays the loan and adds to the expense of the process.
So not disclosing could create the a delay in your process... a delay that sounds unnecessary to me.

Good luck!

Thanks for your response.

Will the appraiser document the room i built as just "unfinished room" of 300sqft in the basement? or will they detail the contents of the room?

I feel as if the plants in the room are "personal property" and need not be disclosed to the bank. If i had some unusual, but legal things in my bedroom i am sure they would not be documented.

 

[CANative]

Agree with Denis.

Some appraisers not in the coastal states get all worked up over marijuana because they're still afraid of it. But if they just stick to describing the room and what it's for without editorializing you should be all right.

Call your loan rep first to make sure they or their investor doesn't have some sort of problem with this.

 

[hockey4848]

Legal and permitted, you should have no worries. I have other thoughts, but I imagine others here will have some experience and have better input.

I wish your family member comfort and healing.

I have no worries as far as legal recourse goes. The state/city knows what I do and has zero issues with it.

I am worried about being denied a loan because of the plants in my home. Why I am seeking the professional advice on this site.

 

[hastalavista]

Will the appraiser document the room i built as just "unfinished room" of 300sqft in the basement? or will they detail the contents of the room?

That's a good question, and one that would probably be determined by the appraiser. If it were me, and you provided me with the documentation, depending on the significant improvement/building changes, I may or may not take a picture. But if I took a picture, I'd do my best not include the personal property.

On this issue, I think if the appraiser wants to take a picture, you can ask him/her to refrain; just tell them that you are not comfortable for the same reasons you just posted. That should be good enough.

My guess is that most appraisers will not take a photo, but that's a guess.

 

[Papoua Jose]

Sorry for your relative's illness.

No grow room experience here. There may be data in areas where these are common and can be measured which would nullify my comments below:

Do the wall, ceilings, floors have finished surfaces where the room could be utilized for a den or rec. room?

If they do, I'd consider it as finished basement area. The materials and finish above and beyond what a normally finished basement room has (excessive lighting, hermetic seals) would be treated as a super-adequacy and may not have much additional contribution to value.

If the room doesn't have the possibility of an alternate use as mentioned above, then I'd consider it similar to a workshop or hobby room.

Another consideration would be if it were a stand-alone room where you have to walk across unfinished basement to access it; that would have a lower contribution to value than if it was accessed via finished stairwell into finished basement room.

I wonder how underwriting will react to a grow room?

 

[redfish]

The type of plant should not matter. I would provide as lengthy a description of the materials used and the methods utilized to insure that moisture will not be a problem. I would type this out in a word document(digital) to email the appraiser, hopefully the appraiser will include this description of the room in the appraisal report. I would tell the appraiser about the health of family member as well.

I think the lender's main concern should be with how integrated this "room" is into the basement. If you were to ditch the property tomorrow, how much work would be needed to remove the remnants of room from the basement after you remove the personal property (lights/fans/shelves and of course the plants!) from the basement. I would think that if you were going to sell the property you would remove the room to improve marketability, right.

 

[hockey4848]

Sorry for your relative's illness.

No grow room experience here. There may be data in areas where these are common and can be measured which would nullify my comments below:

Do the wall, ceilings, floors have finished surfaces where the room could be utilized for a den or rec. room?

If they do, I'd consider it as finished basement area. The materials and finish above and beyond what a normally finished basement room has (excessive lighting, hermetic seals) would be treated as a super-adequacy and may not have much additional contribution to value.

If the room doesn't have the possibility of an alternate use as mentioned above, then I'd consider it similar to a workshop or hobby room.

Another consideration would be if it were a stand-alone room where you have to walk across unfinished basement to access it; that would have a lower contribution to value than if it was accessed via finished stairwell into finished basement room.

I wonder how underwriting will react to a grow room?

The room is drywalled, including the ceiling. The floors are a wooden insulated subfloor. So no it is not finished. And no the rest of the basement is not finished.

underwriting will not like it. i am praying i get lucky and they can leave it out of the report. i really need this mortgage...