Can you use Crypto to buy a home?
By Kurt Real Estate Feb 2, 2022
This issue has been in many media feeds over the past year. The question is…
Can a buyer purchase a home and use “crypto-currency” as a down payment or reserves or claim the Cryptocurrency as assets (for underwriting purposes).
The answer is: NO
FHA, Fannie, Freddie, VA will not allow a home to be purchased using Cryptocurrency and most hard money lenders probably will not either.
Note: That may not stop hard money lenders from advertising that they “may” allow for it.
On December 1, 2021, Freddie Mac published Bulletin 2021-36 for Freddie Mac to provide updated eligibility criteria for qualifying mortgages.
According to the Freddie Mac press release:
“To address uncertainty regarding the treatment of Cryptocurrency in mortgage underwriting, the bulletin explicitly addresses requirements related to Cryptocurrency’s use in the mortgage qualification process”.
Cryptocurrency cannot be utilized to:
1) qualify for a mortgage and,
2) “cryptocurrency may not be included in the calculation of assets as a basis for repayment of [the] obligation.”
Construction loan lenders? You cannot use Bitcoin, Ethereum, or other virtual currency “directly” to make a down payment on your home loan. Although a private arrangement between a seller and a buyer involving Bitcoin MAY be possible if all parties can agree.
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