This Mortgage Lender Will Start Accepting Bitcoin Payments

by Maurie Backman | Published on Aug. 25, 2021

Many or all of the products here are from our partners that pay us a commission. It’s how we make money. But our editorial integrity ensures our experts’ opinions aren’t influenced by compensation. Terms may apply to offers listed on this page.
Mortgage lender goes over documents with couple.

Image source: Getty Images

Will you pay your home loan using crypto?

If you're paying off a mortgage, you're probably used to sending your loan servicer a check every month, or sending payment automatically from your bank account. But now, mortgage borrowers may have a new option for paying off home loans -- using cryptocurrency.

United Wholesale Mortgage recently announced that it plans to accept Bitcoin and other types of cryptocurrency as payment for outstanding mortgage loans by the end of the year. The company intends to start off with Bitcoin (most likely since it's been around longer than any other digital coin) but aims to then expand to other digital currencies as quickly as it can.

United Wholesale is the first major mortgage lender announcing plans to adopt cryptocurrency as a payment option. But if it goes through with its plans, it's possible that more lenders could follow its lead.

Still, that raises the question -- is it a good idea to make your mortgage payments with cryptocurrency? Or should you stick to the cash payments you're used to?

The downside of paying with Bitcoin

As with other investments, once you cash out your Bitcoin holdings, the potential for higher returns goes away. And so if you use Bitcoin or another cryptocurrency to pay your mortgage, you cut off the option to wait things out and see if your digital currency gains value.

Also be aware that if you cash out Bitcoin (or any cryptocurrency) to pay your mortgage when it's worth more than what you paid for it, you're liable for capital gains taxes on that investment return. Stocks work the same way. If you sell stocks when they're worth more than the price you paid, you pay taxes on the gain. And for this reason alone, you may not want to regularly pay your mortgage with Bitcoin -- or any other digital coin.

That said, it is nice to have the option to pay your home loan using Bitcoin or another digital currency. Say you're convinced the value of your crypto holdings is about to decline. Using it to pay your mortgage could be a good idea.

We don't know what regulatory changes might come down the pike that make paying a mortgage with Bitcoin less appealing or less financially sound. But the fact that a well-known mortgage lender is looking to start accepting Bitcoin could prompt a lot more people to jump on the cryptocurrency bandwagon.

Many people are still nervous about investing in cryptocurrency for fear that it's too speculative. But as more and more merchants start accepting it as payment, those fears may subside. And if Bitcoin is deemed legitimate enough that mortgage lenders are willing to collect it for housing debts, that should give investors some confidence that it, and other cryptocurrencies like it, may really be here to stay.

About the Author