New Partnership Lets Homebuyers Use Bitcoin as Down Payment Collateral

Better Home & Finance and Coinbase are launching a new mortgage program that allows homebuyers to use their cryptocurrency holdings as collateral for down payments without selling their digital assets. The program, rolling out within three months, accepts Bitcoin and USDC as collateral and follows Fannie Mae guidelines for lower interest rates.

A groundbreaking mortgage program will soon allow potential homeowners to leverage their digital currency investments as security for down payments without having to sell their cryptocurrency assets.

Better Home & Finance Holding Co. announced Thursday they will launch this innovative crypto-collateralized mortgage within the next three months through a collaboration with digital currency exchange Coinbase.

“Better was founded to make homeownership more accessible for all Americans, and this partnership with Coinbase introduces a new pathway to realizing the American Dream for the 52 million Americans who own digital assets,” Better CEO Vishal Garg stated in the announcement.

Currently, cryptocurrency usage in home purchases remains minimal. According to National Association of Realtors survey data covering home buyers from July 2024 to June 2025, just 1% of respondents who made down payments reported using funds from cryptocurrency sales.

The new mortgage product differs significantly because borrowers won’t need to liquidate their digital currency investments for down payment funds. Instead, qualifying applicants will pledge their cryptocurrency holdings and transfer them to Coinbase as down payment security.

This structure enables cryptocurrency investors to maintain exposure to potential future appreciation in their digital assets rather than converting them to cash.

Even if cryptocurrency values decline, mortgage conditions stay the same without requiring additional security, according to the companies’ announcement. Nevertheless, borrowers risk having their cryptocurrency collateral liquidated if mortgage payments become 60 days delinquent.

The mortgage program will accept only Bitcoin and USDC as acceptable collateral types. USDC represents a stablecoin cryptocurrency that typically maintains a $1 value, the companies explained.

Better emphasized their crypto-collateralized mortgage follows “Fannie Mae guidelines,” enabling mortgage giant backing and qualification for “significantly lower interest rates” compared to alternative crypto-secured lending products.

Fannie Mae and Freddie Mac, operating under government oversight since the Great Recession, purchase qualifying mortgages from financial institutions, supplying housing market liquidity.

Financial institutions creating mortgages for purchase by these mortgage entities have traditionally only recognized borrowers’ cryptocurrency assets after conversion to dollars.

In June, the Federal Housing Finance Agency director, who supervises Fannie and Freddie, directed both agencies to develop proposals considering cryptocurrency as reserve assets when evaluating single-family mortgage loan risks.

Better Homes & Finance Holding stock climbed 5.4% Thursday, while Coinbase shares declined 4.3%.