You can now get a mortgage with crypto.
It’s a new way of buying a home, but only if you’ve got the crypto for it. Milo, a financial technology company, will now allow people who own bitcoin to use it as collateral to take out a home mortgage.
“We understand that crypto does have value, even though most conventional lenders don’t really consider that,” said Josip Rupena, the founder and CEO of Milo.
For now, Milo will only accept bitcoin, but it’s working on eventually accepting other cryptocurrencies.
Crypto expert Kurt Wuckert Jr. says while the idea is encouraging, it’s only a great product if you’ve got at least hundreds of thousands worth of bitcoin in your digital wallet.
“The problem for a lot of people is you gotta have the amount of bitcoin value to your home as collateral, so this is really for high net crypto people only,” Wuckert said.
Rupena says if the value of bitcoin falls, borrowers have the option of adding more bitcoin. The company may liquidate your crypto if there’s a catastrophic drop.
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“Let’s say we liquidate your bitcoin — as long as you continue to make your payments, we are going to be OK,” Rupena said.
If bitcoin goes up, it could be a great way to continue to hold onto your asset.
“I think a lot of individuals who have made wealth in the space is because they held onto it for a period of time, and many of us believe it will be worth more 10 years from now,” Rupena said.
The product comes at a time that crypto is dipping its toes into real estate. Just last week, another financial technology company — Proppy — processed the sale of a Tampa-area home as an NFT transaction.
“It’s really good people want to use their blockchain assets and tech for more than holding and trading, but ultimately, we have the financial vehicles that allow you to put 10% down, 20% down and that probably makes sense for most people,” Wuckert said.
While this is meant to streamline the lengthy process of qualifying for a mortgage — if you want to apply for the crypto-backed loan, you’ll still have to wait just a bit. There’s currently there’s a waitlist of some 7,300 people to apply.