How to Buy US Real Estate with a Bitcoin-Backed Loan

Quick Answer:

A bitcoin-backed line of credit allows you to unlock dollars against your BTC so you can fund a home purchase while retaining your bitcoin exposure. With Lava's BLOC, you can borrow up to 50% of your BTC's value at fixed rates starting around 5%, with no monthly payments and a simple 2% annual capital charge based on your highest outstanding balance.

How Lava's Bitcoin Line of Credit (BLOC) Works

Feature	Details
Maximum LTV	Borrow up to 50% of your BTC’s current value
Rates	Fixed interest starting at ~5% APR
Term	No monthly payments; open-ended term
Fees	2% annual capital charge based on your peak outstanding balance
Uses	Offers, down payments, closings
Additional Benefit	Spend from the line with the Lava Card and earn rewards

Note: If you’re new to Lava, you can get started in just a few minutes by clicking this link.

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Quick answer:
A Bitcoin-backed line of credit lets you unlock dollars against your BTC - so you can fund a home purchase while retaining your Bitcoin exposure. With Lava’s BLOC, you can borrow up to 50% of your BTC’s value, at fixed rates starting around 5%, with no monthly payments and a 2% annual capital charge based on your highest outstanding balance.

How Lava’s Bitcoin Line of Credit (BLOC) Works

Feature	Details
Maximum LTV	Borrow up to 50% of your BTC’s current value
Rates	Fixed interest starting at ~5% APR
Term	No monthly payments; open-ended term
Fees	2% annual capital charge based on your peak outstanding balance
Uses	Offers, down payments, closings
Additional Benefit	Spend from the line with the Lava Card and earn rewards

Note: If you’re new to Lava, you can get started in just a few minutes by clicking this link.

Why Bitcoin-Backed Loans for Real Estate

Preserve your long-term Bitcoin thesis rather than selling for cash.
Access dollar liquidity fast for down payments, all-cash offers, or bridge financing.
Flexible repayment: With Lava’s BLOC, there are no fixed terms or monthly payments—you decide when to repay.

A Realistic Scenario

Borrow $160,000 against your BTC to fund the down payment without selling Bitcoin.

Item	Amount
Home price	$800,000
Target down payment (20%)	$160,000
Your BTC value today	$320,000
Borrowing capacity (50% LTV)	$160,000

Note: Rates, terms, and availability subject to change. Check Lava.xyz for current details.

When to Use a Bitcoin-Backed Loan

You want to preserve your BTC and avoid realizing capital gains.
You’re competing with cash offers and need fast liquidity.
You need a bridge to a later refinance or staged liquidity event.

Risks and How to Manage Them

Risk	Description
Bitcoin price volatility	BTC price drops increase your LTV.
Liquidation risk	Collateral may be liquidated if value falls below required thresholds.

Risk-Reduction Playbook

Borrow conservatively below max LTV.
Keep additional BTC ready to top up if needed.
Make partial repayments if market conditions change.

US Tax Considerations

Note: Educational, not tax advice.

Borrowing against Bitcoin generally isn’t taxable because you’re not selling BTC.
Using BTC to pay interest or principal counts as a disposal and may be taxable.
If collateral is liquidated to repay the loan, that’s a taxable event.
Keep accurate cost basis and transaction records. Consult a tax professional.

What Lenders and Sellers Care About

Proof of funds: Your BLOC provides documented dollar liquidity.
Speed and certainty: Sub-second loan execution from Lava can support faster funding workflows.
Clean, verifiable documentation: Ensure your agent and title company understand the funding source (BLOC).

FAQs

What is a Bitcoin-backed loan for real estate?
A loan that uses your Bitcoin as collateral to access dollars for property purchases without selling your BTC.
How does Lava’s BLOC differ from a mortgage?
It’s a flexible credit line against your BTC with no monthly payments or fixed term; you control repayment timing.
What happens if Bitcoin’s price drops?
Your LTV rises; you may need to add collateral or repay. Severe drops can trigger liquidation of collateral.
Are Bitcoin-backed loans taxable?
Borrowing is generally not taxable. Using BTC to pay loan interest/principal or liquidation of BTC is a taxable event. Consult a tax professional.
Can I close on a home using a Lava BLOC?
Yes, BLOC provides dollar liquidity for down payments or cash offers. Coordinate with your lender/title company.