Coinbase and Better Mortgage Open Bitcoin-Backed Home Loans to the Public

Bitcoin-backed mortgages leave waitlist

Coinbase and Better Mortgage are now accepting applications for a home-financing product that lets borrowers use bitcoin as collateral for their down payment. The launch moves the service from an early-access waitlist to general availability for qualifying buyers in the United States.

The product does not replace a standard mortgage. Instead, it pairs a conventional home loan with a separate loan that provides the cash down payment. The second loan is secured by bitcoin pledged as collateral and a second lien on the property.

How the two-loan structure works

Borrowers close two loans at the same time. The first is a standard conforming mortgage. The second provides the down payment and is backed by bitcoin held in custody.

Both loans carry the same interest rate and repayment term, which results in one combined monthly payment. Better Mortgage handles the origination, underwriting, and servicing of these loans.

Bitcoin is valued at 40% of its market price when used as collateral. This creates a 250% collateralization ratio. According to Better's product terms, $250,000 of bitcoin can support a $100,000 down payment loan.

No automatic margin calls

Unlike some crypto lending products, a drop in bitcoin prices alone will not trigger a margin call or force the borrower to add more collateral. However, Better may liquidate the pledged bitcoin if the borrower is 60 days delinquent on payments.

The bitcoin moves from the borrower's personal Coinbase account to a custodial account managed by Better using Coinbase Prime infrastructure. The collateral stays under Better's control until the mortgage is repaid or refinanced.

What the closing-cost credit covers

Coinbase is offering eligible borrowers up to $10,000 in closing-cost credits. The offer applies to Coinbase One members who get approved for a loan.

The credit equals 1% of the principal balance of each loan, but it is limited by actual eligible closing costs. Better pays the credit directly; Coinbase does not underwrite or service the loan.

From waitlist to general availability

Coinbase and Better first announced the partnership in March. Coinbase directed interested borrowers to a waitlist at that time. Better opened its waitlist in June and stated that responses represented more than $260 million in projected loan volume before general availability.

This projected volume comes from prospective borrowers, not from approved or closed mortgages.

Eligibility requirements remain

General availability does not mean universal eligibility. Borrowers must have a minimum FICO score of 680 and meet Fannie Mae conforming-loan criteria.

The program may only be offered in select states and jurisdictions. Every loan is still subject to standard underwriting and credit approval.

What happens to the bitcoin during the loan

The structure allows borrowers to keep their exposure to bitcoin without facing price-triggered margin calls. However, borrowers cannot sell, transfer, or repledge the bitcoin without Better Mortgage's prior written consent.

Why this matters for crypto holders

The product offers a way for bitcoin holders to access housing liquidity without selling their assets and triggering a taxable event. It blends traditional mortgage lending with crypto custody infrastructure.

• The Defiant