There is one segment of the California economy that apparently has benefited greatly from the cheap home financing and minimal credit checks in the environment fostered by the subprime lenders. In fact, this effect gives a whole new meaning to the term “subprime.” “California is in the midst of a major boom in large-scale marijuana cultivation operations run from inside homes,” according to the LA Times in an article entitled “Busts Point to Boom in Indoor Pot Farms.”
Marijuana seizures have quadrupled in just the last three years, according to officials authorized to speak on behalf of the U.S. Drug Enforcement Administration. Many of the seizures have occurred in what are considered middle-class homes and upscale suburbs of Los Angeles and Sacramento. Gang-related pot growers have taken advantage of cheap financing and the general lack of background documentation of borrowers, receiving loans cynically known in the trade as “liar loans” to acquire homes and then remodel them as indoor greenhouses.
The common practice of these urban plowboys has been for the new homeowners to black out the windows and install ventilation and lighting systems. After settling in, the drug growers use sophisticated growing, watering, and fertilizing equipment to cultivate as many as four crops per year in their otherwise humble, subprime abodes. This output equals or exceeds the yield from traditional outdoor pharmacological agriculture and lacks the danger posed by the discovery of the pot plants via DEA air surveillance or itinerant hikers and campers. “I am not talking about the Cheech and Chong marijuana cultivation of two plants in someone’s closet,” stated DEA agent Gordon Taylor. “I am talking about organized crime groups who are purchasing homes in our communities and creating marijuana factories.”
So as not to attract the attention of neighbors, some drug-growing subprime borrowers have hired gardeners and other employees to perform landscaping work, take out the trash, do maintenance on the houses, turn lights on and off, and otherwise give the indoor pot houses that “lived-in” appearance. And doubtless, of all the subprime borrowers who took out loans to purchase real estate, it is probable that the pot growers are the least likely to miss their mortgage payments and suffer a foreclosure. In that case, their investment might really go up in smoke.
Courtesy of www.whiskeyandgunpowder.com
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