From the tempting prospect of mortgage-free homeownership for $1,000-a-month to the launch of a new bitcoin-collateralized mortgage product, digital currencies and blockchain technology are having a major impact on the mortgage industry.
For more on these stories and other developments that are transforming the mortgage landscape, scroll through to read our roundup.
Mortgage product allows borrowers to post bitcoin as collateral
“We are looking at their crypto, plus other factors that we have in our underwriting, but they don’t have to come with dollars,” said Milo Credit CEO Josip Rupena. “That allows them to not have to go out in the conventional world and sell their crypto.”
For some, however, cryptocurrency’s volatility carries too much risk for it to be accepted as collateral. “To have value as a medium of exchange, you and I need to instantly be able to determine the value of something in that cryptocurrency,” said David Sacco, finance program resident at the University of New Haven. “We’re not there yet.”
Blockchain alternative to the mortgage electronic registration system launched
Developed by Figure Technologies, the new registry utilizes blockchain to automate the onboarding of assets and real-time settlement of loan pledges and sales. Unlike MERS, DART also prevents duplicative registration of loans and riskier settlement arrangements with multiple parties.
“DART not only allows for rapid settlement, but also provides an additional layer of security by making the records immutable,” said Carmine Cacciavillani, founder and president of Blue Sage.
Figure sells eNote mortgages as NFTs in blockchain marketplace
Figure Lending originated and sold the mortgages to asset manager Apollo via the Provenance Blockchain marketplace using NFTs as the assets. Apollo purchased the loans with a digital currency.
“Blockchain can provide enhanced protections and transparency in the ownership process for consumers and real-time settlement for investors, replacing trust with truth to create a faster, more efficient process for everyone,” said Figure’s general manager Daniel Wallace.
Fintech launches blockchain-powered mortgage-free homeownership for $1K per month
Available on select homes priced at up to $2 million in California, Colorado, Oregon and Washington, the plan enables investors to trade a property’s equity through the HausCoin cryptocurrency. Qualified home buyers pay a minimum of 10% on a property and Haus purchases the rest in a ten-year partnership that opens up the home’s equity to trading.
Homebuyers “have the ability to buy more equity at any given time at whatever the current price is, or sell equity back to us,” said Haus CEO Jonathan McNulty. “When you buy and sell equity it doesn’t actually change your monthly payment.”
