Bitcoin loans for real estate let you buy property without selling BTC — but margin calls can force liquidation at the worst time. This guide covers the real numbers, which lenders offer it, and how to structure it safely.
Bitcoin loans for real estate are growing in popularity among Bitcoin holders who want to acquire property without selling their BTC. The core appeal: you keep your Bitcoin exposure while getting liquidity to purchase real estate. The core risk: Bitcoin's volatility can trigger margin calls that force liquidation at the worst possible moment.
This guide covers the actual mechanics of using a Bitcoin loan for real estate, which lenders offer this product, and how to structure it safely.
Bitcoin real estate loans come in two main structures:
Structure 1: Bitcoin-Backed Mortgage (Direct) The lender issues a mortgage on the property with your Bitcoin as collateral. Milo and Ledn offer this product. You pledge Bitcoin to the lender, they issue the mortgage. The home purchase price can be 100% financed using Bitcoin collateral.
Structure 2: Bitcoin-Backed Personal Loan + Conventional Mortgage Borrow against your Bitcoin to generate a cash down payment, then use that cash as a down payment on a conventional mortgage. The Bitcoin loan and the conventional mortgage are separate transactions.
Structure 1 is cleaner. Structure 2 may offer better rates on the conventional mortgage portion but requires managing two loans simultaneously.
Scenario: You hold 8 BTC worth $640,000 at $80,000/BTC. You want to buy a $500,000 home.
Option A: Milo Bitcoin Mortgage
Option B: Ledn Bitcoin Loan + Conventional Mortgage
Option C: Sell Bitcoin for Down Payment
The right choice depends on whether you believe Bitcoin will appreciate more than the loan cost over the mortgage term.
Product: Cryptocurrency mortgage — Bitcoin is the primary collateral LTV: Up to 100% of Bitcoin value (varying by product) Rate: 8-11% depending on LTV and Bitcoin market conditions Term: 15 or 30-year fixed available Geographic restriction: Available in most US states; check current availability Property types: Primary residence, investment property
Milo is the most prominent dedicated Bitcoin mortgage lender in the US market. Their underwriting is primarily based on Bitcoin collateral rather than income.
Product: Bitcoin-backed loan (not a mortgage, but can be used for down payment) LTV: 50% of Bitcoin value Rate: Varies; typically 10-14% annually Term: Recurring (monthly or annual) Geographic restriction: Not available in all US states; strong in Canada and international Use case: Down payment loan, not direct home purchase
Product: Bitcoin-backed loan with collaborative custody LTV: 40-50% of Bitcoin value Rate: Varies by market conditions Advantage: Collaborative multisig custody — no automatic liquidation without human review Use case: Down payment or bridge loan
Margin calls are particularly dangerous in real estate contexts because:
You cannot quickly sell the house to meet a margin call: Real estate is illiquid. If Bitcoin drops and you need to post more collateral or repay the loan, you cannot sell the house in 24 hours.
Dual debt service stress: If both Bitcoin drops and real estate values decline simultaneously (a plausible scenario in a severe recession), you face margin calls on your Bitcoin loan while also holding a potentially underwater mortgage.
Sequence-of-returns risk: A large Bitcoin drop early in the loan — before Bitcoin appreciates significantly — can force liquidation of your Bitcoin at exactly the wrong time.
If using a Bitcoin loan for real estate, structure it conservatively:
Use maximum 40% LTV, not 50-60%: At 40% LTV, Bitcoin needs to drop 50% before you approach the margin call threshold. At 60% LTV, only a 25% drop triggers warnings.
Keep 20% of your Bitcoin unencumbered: Maintain a reserve of Bitcoin outside the loan that you can quickly post as additional collateral in a margin call scenario.
Size the loan for your income: Make sure you can service both the real estate debt and the Bitcoin loan from income alone, without depending on Bitcoin appreciation.
Choose a lender with human review: Unchained's collaborative custody prevents automatic liquidation. Human-reviewed margin processes give you time to respond.
Have a paydown plan: Know at what Bitcoin price you would sell enough to reduce the loan significantly. Having a plan prevents panic decisions.
Bitcoin loan is not a taxable event: Borrowing against Bitcoin does not create a taxable sale. Your Bitcoin retains its original cost basis.
If Bitcoin is liquidated in a margin call: Liquidation IS a taxable event. The proceeds minus your cost basis are a capital gain.
Mortgage interest deduction: Interest on the real estate mortgage (not the Bitcoin loan) may be deductible if used for primary residence purchase. The Bitcoin loan interest is generally not deductible as mortgage interest.
Can I get a Bitcoin loan to buy real estate if I do not have income? Milo's product is primarily collateral-based and may not require traditional income documentation. Other lenders require income qualification. This depends on the specific lender and product — verify directly.
Is a Bitcoin mortgage considered a good idea? For Bitcoin bulls with large holdings who want real estate without selling BTC, Bitcoin mortgages are a legitimate tool. The risks — margin calls, high interest rates, dual debt exposure — are real and serious. They work best for disciplined holders with significant liquid reserves.
What happens to my Bitcoin mortgage if Bitcoin becomes worthless? In an extreme scenario where Bitcoin loses nearly all value, your Bitcoin collateral would be liquidated. The proceeds (whatever they are) would reduce your mortgage balance. You would still owe any remaining balance on the real estate mortgage — secured by the property itself.
Can I refinance from a Bitcoin mortgage to a conventional mortgage? Yes. This is a common exit strategy. Once you have enough property equity and can qualify for conventional income documentation, refinancing to a conventional mortgage releases your Bitcoin collateral.
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