The Big Story: Lenders and grow-ops
Brokers are generally supportive of registering former grow-op properties, but will monolines and banks ever lend on those rehabilitated homes?
Video transcript below:
Reporter: Grow Op Registry, right idea or a politician’s mind hot smoke, mortgage brokers can’t agree on Ontario’s move to register those properties, both past and present. Welcome to Grow Op, the debate continues on the Big Story.
Uncertainty over how exactly a proposed Grow Op rule would work is still in the debate. Would buyers have interest in [mediated] properties or the lenders. A registry might help answer that second question.
Joe Walsh, Mortgage Broker, Bedrock Financial Group Inc.
Joe Walsh: I think having a registry of the Grow Ops in Ontario for instance could be a good first step towards trying to get the lenders to lend on these products. Consumers are not being served properly, lenders don’t want to lend on them and I think the first step would be we’d have to register, be organised, I think maybe now insure, maybe we start insuring them and therefore lenders would start lending on them.
Reporter: The concept sounds good on paper, but what obstacles lied ahead for brokers?
Phil Edwards, Mortgage Broker, Mor. Can Direct
Phil Edwards: The ramifications I see are basically in terms of governance, extra lot of unanswered questions as who is going to be governing that list. How long is it going to take that property to be taken off the Grow Op list, what are they going to be looking for to establish exactly what is a grow op, so and again for tax payers as well, does it affect us because that is to be a government body that is going to monitoring that. So that is more funds of tax payers doesn’t have to update, to monitor in meeting that Grow Op list.