Cryptocurrency Revolution in Mortgage Risk Assessments
The Federal Housing Finance Agency has directed Fannie Mae and Freddie Mac to consider cryptocurrencies as assets for mortgage loan risk assessments. This move aims to open pathways for borrowers with crypto investments to qualify for home loans, aligning with efforts to position the U.S. as a global crypto hub.
The Federal Housing Finance Agency (FHFA) has made a groundbreaking decision, instructing Fannie Mae and Freddie Mac to incorporate cryptocurrency in their risk assessment for single-family mortgage loans. This directive could pave the way for borrowers to utilize their crypto assets to qualify for home loans.
William Pulte, the FHFA's director, announced that this alignment with President Donald Trump's vision is meant to transform the United States into a premier crypto-friendly nation. Fannie Mae and Freddie Mac, both government-controlled entities since the 2008 financial crisis, are integral to the U.S. housing market, guaranteeing over half of its mortgages.
Despite the notorious volatility of cryptocurrencies, such as Bitcoin's recent sharp decline and subsequent recovery, the directive aims to expand the financial criteria considered for homeownership. This initiative forms part of broader efforts to reshape the U.S. cryptocurrency policy, with industry participation and support seemingly on the rise.
(With inputs from agencies.)
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