Milo says customers will be able to pledge their Bitcoin to snap up property — unlocking low interest mortgages that last for 30 years.
A fintech company has announced that it is launching crypto mortgages in the U.S.
Milo says customers will be able to pledge their Bitcoin to snap up property — unlocking low interest mortgages that last for 30 years.
Touted as a solution that enables borrowers to diversify into real estate without having to sell their BTC, the company says crypto can be used for 100% of the collateral, with no dollar downpayments required.
According to the company, the process could also be far faster than going through fiat-focused banks and financial institutions.
The product is set to launch early this year — and Milo claims that a significant waitlist has already been formed. Josip Rupena, the company's CEO and founder, explained:
"The existing ways for crypto consumers to access home credit has left them with unintended tax liabilities of selling for a downpayment or worse the opportunity cost of seeing their crypto increase in value. There are countless stories of people buying property with Bitcoin proceeds only to see it increase in value and be worth millions more."
Rupena added that many consumers end up being rejected by other banks because they only own crypto, and said: "We have an opportunity to make sure that doesn't happen anymore and their Bitcoin wealth can now help them buy a property."
The concept has already won support from the likes of Mayor Francis Suarez, who is on a mission to ensure that Miami becomes the friendliest city for crypto investors in America. He said:
"Milo's decision to expand their financial flexibility with crypto mortgages is a groundbreaking achievement for advancing the United States' dominance in crypto. To become the Capital of Capital, Miami needs companies like Milo who are willing to innovate and ideate."
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Light on Details
A number of mortgage lenders have explored accepting cryptocurrencies as collateral before.
Milo's announcement does miss out some rather important details — such as how much collateral is needed (and whether this would amount to more crypto than the dollar value of a home,) and what happens if BTC enters a bear market.
Bitcoin ended up declining by about 80% in 2018 — and if such a scenario was to be replicated again, it's hard to imagine that this wouldn't have an impact on those who have their mortgages secured with crypto.
