Crypto Gets a Footing in Home Financing

Homebuyers in the US can now use cryptocurrency to qualify for loans without having to liquidate their digital assets immediately. According to recent changes, buyers can list their virtual tokens as an asset when applying for a mortgage.

The new rules, introduced by Fannie Mae and Freddie Mac, allow homebuyers to convert their tokens to U.S. dollars when it's time to use them for down payments or closing costs. This change is expected to widen mortgage opportunities for individuals who own cryptocurrency.

Before these changes, buyers would have had to liquidate their crypto assets up front, which could have resulted in a loss of value due to market fluctuations. The new rules acknowledge the growing importance of digital currencies and are seen as a step towards making them more accessible to mainstream finance.

The Federal Housing Administration (FHA), the Department of Veterans Affairs, and certain banks that do portfolio lending and exotic mortgages also accept cryptocurrency as qualifying assets.

Fannie Mae requires a letter of explanation and sourcing of funds whenever a large dollar deposit is made into a bank account. However, when it comes to cryptocurrency deposits, no such documentation is required.