Better launches Bitcoin-backed mortgages powered by Coinbase

Better Mortgage and Coinbase have made their Bitcoin-backed mortgage product generally available, allowing US homebuyers to pledge Bitcoin as collateral for a down payment without selling it, the companies announced Wednesday.

According to Coinbase’s Help Center, the product pairs a Fannie Mae-backed home loan with a separate down payment loan secured by Bitcoin (BTC). Borrowers must pledge BTC worth at least 250% of the down payment loan, with the pledged BTC transferred to Better’s custodial account on Coinbase Prime.

The two loans carry the same interest rate and amortization term and are repaid through a single monthly payment, Coinbase said. The pledged BTC is returned once the mortgage is fully repaid or refinanced, subject to the loan terms.

Bitcoin price declines alone do not trigger margin calls or changes to the mortgage terms. However, Better can liquidate the pledged BTC if a borrower becomes 60 days delinquent on payments, according to Coinbase.

Borrowers must be US residents with a verified Coinbase account, and remain subject to Better’s credit, income and other underwriting requirements. Coinbase One members are also eligible for a 1% rebate from Better, subject to a $10,000 cap, that can be used toward closing costs and fees.