Newrez, a top five U.S. mortgage lender, has announced that it will now recognize cryptocurrency assets for mortgage qualification, becoming the first major lender among the top 25 in the country to do so. This initiative, slated to launch in February, will allow consumers to use their eligible crypto holdings for asset verification and income estimation without needing to liquidate their digital assets.

The decision reflects the increasing prevalence of cryptocurrency in investment portfolios and the growing involvement of financial institutions in digital assets. Newrez aims to broaden the path to homeownership by allowing consumers to maintain control of their investments while accessing innovative financing solutions.

Starting in February, Newrez will recognize Bitcoin (BTC), Ethereum (ETH), SEC-approved spot ETFs backed by BTC or ETH, and USD-backed stablecoins. To be eligible, these crypto assets must be held with U.S.-regulated exchanges, brokerages, or banks. The company will apply a volatility-adjusted valuation to account for market fluctuations. While crypto holdings can be used for asset and income verification, all mortgage payments and closing funds must be in USD.

This move by Newrez addresses a long-standing challenge for potential homebuyers whose wealth is largely in cryptocurrency. Previously, these individuals were often required to sell their crypto assets to qualify for a mortgage, reducing their financial flexibility. Newrez's new policy allows borrowers to retain their crypto investments, providing greater financial flexibility while maintaining prudent underwriting standards.

According to Newrez, an estimated 45% of Gen Z and Millennial investors own crypto, many of whom are now entering their prime homebuying years. By integrating crypto assets into the mortgage approval process, Newrez is positioning itself to meet the evolving needs of these tech-savvy and investment-diverse consumers.

Baron Silverstein, President of Newrez, stated that the increasing number of consumers including crypto in their investment portfolios and the deepening involvement of major financial institutions in crypto assets, supported by key regulatory developments, makes this the right time to integrate crypto assets into modern mortgage lending. Leslie Gillin, Newrez Chief Commercial Officer, added that this innovation marks another step in creating new pathways to homeownership, giving consumers flexibility and control.

The new offering will be available across Newrez's Smart Series product suite, a comprehensive range of non-agency products. For mortgage originators, this move could create new opportunities to serve borrowers who previously faced liquidity constraints or were forced to sell digital assets to meet qualification requirements.