There are a few ways to make Bitcoin mortgages work, and each way is subject to the distinct laws and regulations that pertain to each country, and distinct policies that differ from lender to lender.
Lenders who wish to use Bitcoin to pay mortgages must identify it as an asset.
While applying for a mortgage, investors must list all of their properties, cash, and cash equivalent assets so that lenders can determine the quantified amount to borrow.
Sometimes, lenders also refer to applications with Bitcoin deposits over to the financial crime unit to double-check if there are any signs of money laundering.
They might also ask for a statement from the fund platform and a bank statement as evidence of the source of the assets. How does a Bitcoin mortgage work?
Currently, BTC is standing in a very vulnerable position. The crypto reached milestones last year in 2021, taking the entire crypto market. But it crashed shortly after its massive price rallies.
Bitcoin mortgage is not a good idea right now because its massive volatility might cause enormous financial losses.
Recently, in January 2022, Bitcoin steeped below US$40,000 causing a huge crash in the crypto market. It wiped over US$1 from the aggregate crypto market.
There have definitely been other downturns for the crypto market and Bitcoin, but this incident marked the second-largest ever decline in the dollar for both.
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