FHFA Considers Bitcoin for Mortgage Qualification
FHFA Examines Bitcoin Holdings to Ease US Housing Crunch
The Federal Housing Finance Agency (FHFA), led by William Pulte, is exploring whether cryptocurrency, specifically Bitcoin, can be counted as part of borrowers’ financial assets when qualifying for mortgages. This move aims to address declining mortgage applications amid ongoing housing market challenges.
Why This Matters
Mortgage volume slowdown: Originations are near historic lows due to limited housing supply, high interest rates, and aging homeowners holding on to properties.
Crypto-friendly lending: Some boutique lenders already accept Bitcoin as collateral. FHFA acceptance could expand crypto-backed loans into federal programs like FHA, VA, and USDA loans, significantly benefiting borrowers.
Regulatory Changes Enabling the Shift
SAB 121 repeal: A regulation that forced banks to record crypto as liabilities was rescinded in January 2025, paving the way for broader institutional acceptance.
FHFA endorsement: Official acknowledgment from FHFA would mark a watershed moment in mainstream crypto adoption and unlock federally backed mortgage programs.
What Stakeholders Say
Assessing mortgage risk: Analysts highlight Bitcoin’s public blockchain as offering transparent custody, a potential advantage as collateral.
Lender adaptations: Companies like Milo and Strike already offer crypto-backed loans, but volatility poses margin risks and calls for robust risk management.
Growing crypto demographics: Around 20% of Americans hold crypto assets, most under $50,000, meaning crypto-backed mortgages could help many more secure homeownership.