Yes, I know that BTC appears to be “alive” at the moment, but this group should be posting and reading information like this so as to stay current with bigger picture ideas, especially if you plan on owning a house one day and don’t want to sell your holdings/HODLings.
Better + Coinbase now let you use BTC for your house down payment without selling it.
You get 2 loans. One is a normal Fannie Mae mortgage on the house. The second one covers your down payment and that one is backed by your BTC.
You have to lock up 2.5x what you borrow. So if you need 100k for down payment you pledge 250k in BTC. Your BTC goes into Better's custody on Coinbase.
No tax event when you pledge because you didn't sell. You keep your BTC upside.
No margin calls if BTC dumps. They only touch your BTC if you miss payments for 60+ days.
Catch: Better can reuse your BTC while they hold it, they just have to give you the same amount back later. And you can't get your BTC back until your main mortgage is paid off or refinanced, even if you pay off the down payment loan early. So it could be locked for 30 years.
Rates are a bit higher than a normal mortgage, like 0.5% to 1.5% more.
TLDR for BTC maxis: you don't sell, you don't pay cap gains, you don't get liquidated on a dip, but you give up custody for a long time and trust Better to give it back.
What happens if Better goes bankrupt while holding my BTC?
Run the math for a 500k house with 100k down
Why is this better than just selling BTC for the down payment?
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