Better Mortgage Unveils Bitcoin-Backed Conforming Mortgage Product

Better Mortgage and Coinbase have made their Bitcoin-backed conforming mortgage product available to the public. The loan allows borrowers to use up to $250,000 in Bitcoin as collateral for a down payment on a house without triggering margin calls based on price movements alone.

The loan is structured as two separate loans: a standard first mortgage that conforms to Fannie Mae guidelines and a second loan that supplies the cash down payment. The second loan is secured by pledged Bitcoin and a second lien on the property, with a 40% advance rate and a 250% collateral requirement.

The borrower retains economic exposure to the Bitcoin but gives up normal control and liquidity during the pledge period. Payment default, not price movements, drives liquidation, with delinquency beginning the day after a missed payment and giving the borrower 30 days to bring the account current. If the borrower remains delinquent for 60 days, Better may liquidate the pledged Bitcoin.