Crypto Adoption In Mortgage Industry

Fannie & Freddie Ordered to Take Crypto Into Account

The head of the FHFA just ordered Fannie Mae and Freddie Mac to consider crypto in a borrowers qualification to get a mortgage. This means that these assets can be taken into account when seeking loan approval. All crypto must be “ evidenced and stored on a U.S.-regulated centralized exchange subject to all applicable laws”. While this is not yet in practice yet, the agencies need to come up with proposals at how to value crypto assets in when looking at borrower’s creditworthiness. Fannie Mae and Freddie Mac use automated underwriting systems that weigh things like, assets, credit, income, and collateral to determine if a loan will be granted. Currently crypto assets are not included in this decision, but it looks like they will be in the near future.

Crypto can be used to buy a home!

As of now Crypto can be used as down payment funds or funds brought in to close of escrow. The funds need to be transferred to fiat currency like USD first. Funds also need to be sourced with statements, showing ownership of the crypto and transfer into a traditional bank account.