What is a crypto mortgage? Everything you need to know

Published on
July 31, 2022

With global financial and real estate markets facing volatility we haven’t seen in years, many potential homebuyers have made the difficult decision to put their homeownership plans on hold. Borrowers are facing rapidly increasing interest rates and watching as required down payments for homes skyrocket.

And while interest in digital real estate across the metaverse continues to grow, that doesn’t bring much comfort to those looking to find their next home.

Fortunately, not everything dealing with the blockchain involves ownership of pixelated art in the form of non-fungible tokens or NFTs. Crypto mortgages are becoming an increasingly popular alternative for those looking to secure funds for a new home.

In this article, we’ll cover everything you need to know about crypto mortgages, from the pros and cons to the growing list of startups offering borrowers the ability to take out a home mortgage using crypto as collateral. 

Who said crypto doesn’t have any real-world value?

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What is a crypto mortgage?

Like a traditional home loan, a crypto mortgage is an agreement between a borrower and lender that allows the borrower to borrow funds to purchase a home. In exchange, the borrower agrees to make payments with interest for the duration of the loan.

However, unlike a traditional mortgage, a crypto mortgage uses digital currency or crypto as collateral, allowing borrowers some unique advantages and additional flexibility. Crypto mortgage lenders base their loan offers on the size of your digital asset portfolio. 

Let’s break it down.

How do crypto mortgages work? 

Traditionally the homebuying process involves rigorous credit checks and hours upon hours of rate shopping, not to mention lots of paperwork. If you have good credit but your partner doesn’t, that could be grounds for suboptimal rates!

Crypto mortgages, on the other hand, are a little more straightforward. Lenders, in most cases, don’t base the loan terms on your credit score or take into account how many times you’ve recently applied for credit. Instead, they heavily factor the size of your crypto portfolio. The more crypto you hold, the better your rates and higher amount you can borrow.

A typical crypto mortgage works as follows:

  1. Choose one of the many crypto mortgage companies you wish to borrow from (we cover some of the most reputable companies below.)
  2. Complete a minimal application process by sharing some basic details about yourself. Some companies will require more information, others less—more on that below.
  3. Share the amount of crypto you would like to use as collateral. The larger your crypto holdings, the more you’re able to borrow. Typically, you’re able to get a loan for the amount you put as collateral. For example, if you agree to put up 50 Ethereum (roughly 100k in USD at the time of this writing), you’ll be able to borrow 100k for your home.
  4. Choose your desired rate and monthly payment plan to complete the loan.
  5. Call your real estate agent or broker and put an offer on your forever home or perfect real estate property—Miami or New York, anyone?

While there may be an additional step or two depending on which crypto mortgage platform you use, as more fintech companies begin to utilize crypto for lending, the process will become more streamlined over time.

4 major benefits of a crypto mortgage 

  1. Accessible borrowing

It’s no secret that here at Parcl, we’re working to make desired asset classes, such as real estate investments, accessible to everyone. And to a large extent, crypto mortgages do just that. If you hold cryptocurrency and want to get a crypto mortgage, it doesn’t matter if you have bad credit, lack of payment history, or don’t have a six-figure income. Your crypto mortgage is based entirely on the amount of crypto assets you hold.

  1. Tax advantages

One of the major benefits of a crypto mortgage is that you’re not required to “cash-out” of your cryptocurrency portfolio; this can have significant tax advantages for those not wishing to take the off-ramp to fiat and pay taxes in the process. 

If you have a substantial amount of crypto holdings, crypto mortgages can be especially appealing. You can put up your digital assets as collateral and reduce your tax liability from selling your crypto to cash.

  1. No credit checks

In most cases, you won’t need to have any credit checks done for a crypto mortgage. Again, this can be massively helpful if you have subpar credit or have any high-risk factors traditional home loan lenders look down on.

No credit checks can help you speed up the process and helps give home buyers more options than ever before.

  1. Get more out of your crypto

Some lending platforms allow you to “stake” crypto, which can help reduce your overall debt obligations. Staking is similar to putting your money in a traditional savings account. You use your crypto to earn interest. By staking your collateral, you can reduce the overall amount you owe throughout the course of the loan. 

2 downsides of a crypto mortgage 

While crypto mortgages generally show incredible promise, it’s important to acknowledge the downsides.

  1. Liquidation risk

Because crypto markets do tend to be particularly volatile, there is a non-zero risk that you could be liquidated and forced to repay your loan in an accelerated time frame. If the price of a crypto asset such as Bitcoin or Ethereum drops drastically, this could ultimately affect your loan status.

That’s why it’s important to only agree to terms you feel comfortable with—consider being conservative in your loan amount to account for downswings in the markets. Using stablecoins as collateral can reduce your risk somewhat, but there remains the chance of liquidation regardless of how much you plan for a down market. 

  1. No control over assets

Similar to when you make a traditional down payment, the crypto you use as collateral cannot be used. Once held as collateral, you won’t be able to access those funds. If most of your net worth is in crypto, it’s important to factor that into your decision. Furthermore, if an asset you use as collateral jumps in price, you’re unable to realize those gains.

Where can I get a crypto mortgage? 

Crypto mortgages are relatively new, but many of the brightest minds in Web3 are building the future of home loans.

Here are some of the top crypto mortgage options on the market today.


  • Florida-based 
  • First to offer crypto-backed mortgages in the US
  • Offer 30-year loans of up to $5 million
  • Rates range from 3.95% - 5.95% 
  • Accepts BTC, ETH, USDC, USDT & GUSD


  • Crypto mortgages for Texas residents
  • Can borrow up to $5 million with 5.5% to 7.5% APR
  • Your collateral is staked, which offsets some of the monthly mortgage payment
  • Accepts BTC, ETH & USDC 


  • Based in North Carolina 
  • Offers loans of up to $20 million
  • A 30-year fixed-rate mortgage with interest rates as low as 6% 
  • Will accept BTC & ETH 
  • Has a waitlist for crypto mortgage loans


  • Bitcoin backed loans in Canada 
  • 7.90% annual interest • 9.90% APR
  • Plans to offer Bitcoin mortgages to Canadian and US residents 

Shared content and posted charts are intended to be used for informational and educational purposes only. Parcl does not offer, and this information shall not be understood or construed as, financial advice or investment recommendations. The information provided is not a substitute for advice from an investment professional. Parcl does not accept liability for any financial loss or damages. For more information please see the terms of use.

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