Fannie Mae to Accept Bitcoin and USDC for Mortgage Down Payments

Fannie Mae, Better Home, and Coinbase launch a program allowing Bitcoin and USDC as mortgage collateral, eliminating the need to sell crypto for down payments.

A new financial product is allowing customers to use cryptocurrencies as collateral for a down payment when purchasing a home—a move that could shift how real estate transactions are financed in the United States.

Crypto as a Home Down Payment

This new model enables buyers to pledge Bitcoin or USDC as collateral instead of selling their assets to fund a down payment. This means investors can maintain their exposure to the crypto market without triggering tax liabilities from a sale.

The mortgages are structured as standard loans approved by Fannie Mae, placing them firmly within the traditional financial system. In this way, the product combines innovation with regulatory stability, which is a vital factor for mainstream adoption.

Solving a Chronic Problem

According to Better, approximately 41% of American households are unable to purchase a home specifically because they lack sufficient funds for a down payment. This occurs even when they hold assets—including cryptocurrencies—that are not directly utilized in traditional mortgage lending.

The company’s CEO, Vishal Garg, emphasizes that the combination of high interest rates and consistently high property prices puts buyers under significant pressure. In this context, the new product offers an alternative that eliminates the need for asset liquidation and complex tax procedures.

How the Model Works

Coinbase customers can transfer their assets into a custodial wallet managed by Better while retaining ownership. Unlike classic crypto loans, this product does not involve margin calls or requirements for additional collateral if the price drops.

Even if the value of Bitcoin decreases, the loan terms remain unchanged. Liquidation of the collateral can only occur in the event of a serious delinquency—such as non-payment within 60 days—similar to traditional mortgages.

Cost and Accessibility

Despite the advantages, crypto-collateralized loans come with a higher price tag. Interest rates are between 0.5 and 1.5 percentage points above standard 30-year fixed-rate mortgages, depending on the client’s profile.

Nevertheless, the model may prove particularly attractive to investors with accumulated crypto assets who do not wish to sell at current prices or lose out on future growth potential.

Moving Toward the Mass Market

Until now, similar solutions were primarily aimed at wealthy clients and asset managers. However, this new product targets a broader audience, including the average homebuyer.

According to Marc Trojanowski, the idea is to democratize access to housing finance by applying the logic of private banking: borrowing against assets instead of selling them.

Broadly speaking, the initiative signals the gradual merging of the crypto ecosystem with traditional finance—a trend that could accelerate if the product successfully attracts mass demand.