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Can You Buy A House With Bitcoin

Recently several people have asked me if they could purchase a home or at least pay their closing balance with the now famous cryptocurrency, Bitcoin.


While there are documented cases in the U.S. of residential real estate transactions that have been completed with Bitcoin as the form of payment, they appear to have been private transactions where both buyer and seller agreed to use the digital coin to seal the deal.


I reached out to a couple of my preferred local providers to get their take on this growing form of payment and if we will see it used by buyers to pay for homes in Southern Indiana any time soon.


I spoke with Brad Sea of Kentuckiana Mortgage Group (https://www.kyinmortgage.com) and he said that when there is a mortgage involved “the holder of the Bitcoin would have to convert it to cash first” and then use those funds to complete the purchase.


I also talked to Mike Kemp with Momentum Title Agency

(https://momentumclosings.com) who confirmed that “For Indiana, [Bitcoin] would not be defined as ‘good funds’ so it’s a hard ‘no’ in Indiana until or unless they modify the state statute.”


Even in a situation where a mortgage isn’t involved and both buyer and seller agree to use Bitcoin as payment, it is still complicated by the fact that the value of the coin changes minute-by-minute and the swings in value can increase and decrease dramatically in a 24-hour period. This makes it difficult to determine just how much Bitcoin needs to change hands in order to equal the value of the purchase price.


“Because of these challenges, I don’t believe title agencies will accept bitcoin within the next few years, which means these parties will need to bypass traditional escrow and wiring procedures typically required by these service providers if Bitcoin is the preferred method of payment”, Kemp added.


Despite the challenges, Brad and Mike both assured me they are paying close attention to developments in the cryptocurrency market and that if and when it becomes a practical and accepted way for their clients to transact real estate, they are both prepared to lead the way in Southern Indiana.


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