By Matt Joy, Princeton Mortgage Wholesale
Photo by David McBee from Pexels
4 days into the new year and the housing industry is inserting blockchain into the way we conduct business and condos are for sale in Bitcoin. That’s right… 4 days in and I’m already tired of hearing about blockchain and Bitcoin. The reality of the situation is the mortgage industry’s “Killer B’s” aren’t going anywhere and we’ll be hearing about them quite often as we embark on our journey into 2018.
National Mortgage News ran an article earlier this week that pointed to the influx of real estate startup companies using blockchain technology. One of the companies mentioned was Propy, a global real estate marketplace that allows its users to close deals through “smart contracts” (no idea what they are) on a blockchain platform… ummm what? Another startup, RealBlocks allows people to invest in housing using cryptocurrencies (Bitcoin) and starting February their own form of currency… again, ummm what? Besides the 1% of the population (that I’ve found) that can explain this stuff you’re probably thinking the same thing that I am… WHERE IS THE REAL MONEY… the paper stuff?
Look, I think I can get behind the idea of blockchain being used for certain things in the housing industry. Having a decentralized database of transactions that can be tracked, recorded and stored is awesome. To me it makes sense to use blockchain for the title and registry process, but even still getting an entire industry to change… that is a heavy lift. We’ll have to integrate new software’s to local governments, title companies, realtors, homeowners etc.
Okay… so how does blockchain insert itself into the mortgage space? Apparently, through the use of these “smart contracts” (still have no idea what they are) borrowers can provide their lender a coin or token to start the ledger (or tracking… I guess) then the lender will ask the borrower to provide their documents… and that’s about as far as I got in terms of figuring it out. Honestly, I have no idea how this will work, but there are smart enough people out there that will figure it out and there is a demand for them to do it. I’m sorry I know that was a lot to take in… but I almost forgot there is a condo for sale on Redfin for 33 Bitcoin. It’s the only form of payment the seller will accept… I mean unless you have $544,038 of cash on hand… I bet you could talk them into accepting that.
The opinions expressed in this post are the sole view of the writer and do not reflect the opinion of Princeton Mortgage Corporation.