Better Mortgage and Coinbase Launch Bitcoin-Backed Mortgages for Homebuyers

Bitcoin-backed mortgages are now available to qualified homebuyers in the US, thanks to a partnership between Better Mortgage and Coinbase. The companies have made this product generally available after initially testing it with a small group of borrowers earlier this year.

The mortgage would allow buyers to put up Bitcoin as collateral for their down payment instead of selling their coins to raise the capital. To qualify, applicants need to pledge Bitcoin worth at least 250% of the down payment loan amount.

For instance, an individual borrowing $10,000 for a down payment would need to post at least $25,000 worth of BTC as collateral. The borrower's coins are then moved from the Coinbase account into Better's custodial account on Coinbase Prime, where they remain locked until the mortgage is paid off or refinanced.

The offering does not affect borrowers when Bitcoin price drops, and a decline in value will not trigger a margin call or change the loan terms. However, if a borrower falls 60 days behind on payments, Better can liquidate the pledged coins to recover their losses.