Pennsylvania-based mortgage lender Newrez will begin accepting cryptocurrency holdings in home loan applications starting in February, according to the US Federal Housing Finance Agency. It’s a significant shift in how traditional lenders approach digital assets.
The move follows an FHFA directive instructing Fannie Mae and Freddie Mac to integrate crypto recognition into their loan application processes.
The goal? Expand homeownership opportunities for younger Americans, who hold more cryptocurrency than older generations. As the average age of US homeowners has climbed in recent years, housing authorities want to create new pathways for millennials and Gen Z buyers who’ve accumulated wealth in digital currencies rather than traditional savings accounts.
One major barrier has been taxes. Crypto holders who sell their assets to make down payments face significant capital gains taxes, which has kept many out of the housing market despite having substantial digital wealth.
The FHFA directive to Fannie Mae and Freddie Mac—which together back a substantial portion of US mortgages—effectively legitimizes digital assets as a recognized form of wealth for mortgage qualification purposes. It represents a notable policy evolution for the government-sponsored enterprises.
Newrez isn’t alone in this space. Milo, another lender, already offers crypto mortgage options designed to help borrowers avoid tax liabilities when converting digital assets into down payments.
But there’s a problem: volatility.
Crypto’s notorious price swings present real challenges for lenders trying to assess borrowers’ financial stability and collateral value. A crypto portfolio worth enough for a down payment one week could fall below that threshold the next, complicating underwriting standards that rely on stable asset valuations.
Regulatory uncertainty creates additional complexity. The crypto industry continues navigating an evolving compliance landscape, with rules around digital asset custody, reporting, and classification still being defined at federal and state levels. How lenders will manage these uncertainties while meeting traditional mortgage lending standards remains an open question.
If implemented successfully, crypto-inclusive mortgage applications could reshape home financing practices in the United States. The outcome will likely depend on how lenders like Newrez develop systems to account for cryptocurrency’s volatility while satisfying the risk management requirements of Fannie Mae and Freddie Mac.
February marks the beginning of the experiment.
