Crypto currency (IF banned from CA)



YoboCopter said:
someone told me alot of banks when you apply for a morgage will refuse if your moneys come from crpyto?

cant see why they would can anyone shed any light
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nikom court said:
because bitcoin is the enemy of legacy banks because it basically makes them redundant,
if trading crypto is your main income,just say on the application you are self employed.
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No, it's because banks offer loans based on the value of the collateral (house in this case) and the credit risk of the borrower. A friend sold a highly graded Lebron James rookie card for something like $15,000 last year and the mortgage lenders wouldn't touch it for 30 days because when cash shows up in accounts without a prior history, they want to make sure there's no unposted debt that matches it.

There may be some element of conversion risk--if your banker can't figure out how much your crypto will be worth in 30-60 days when the sale happens, they don't want to underwrite any risky transaction. What if there's a dip and you're just a little short? Bankers like the easy math (not because they're stupid, but they may play dumb on purpose.)

There's also probably some question about where the money comes from--in the US for instance if you generate your cash through illegal activities the Feds can still come in and seize property. This has created an interesting/weird economy in Colorado in recent years because selling marijuana is legal in CO but it's still a US crime. So banks won't house any money for the businesses/owners because they don't want to risk it being seized by the Feds*. People who generate legitimate income through these related businesses will take their cash and buy houses/land/property in a cash sale; now the property can generate income that has no risk of recapture or it can be sold and the money is "laundered."

But the main issue is proving credit worthiness, so cash out your crypto and let it sit on a balance sheet as actual fiat currency for 30-90 days and you'll get around this issue.

Also, on the second comment, just no. Banks don't create currency, they hold currency. They create credit/liquidity. Banks will gladly hold your funds or lend you funds, but are risk averse, and they apply their risk aversion equally to personal credit risk and bureaucratic legal risk. Banks don't really care where your money came from so long as it doesn't put them at risk.

*this may have changed recently, but this was the case even a few years ago
 
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YoboCopter said:
someone told me alot of banks when you apply for a morgage will refuse if your moneys come from crpyto?

cant see why they would can anyone shed any light
Click to expand...
How would they know?

I would assume you would have to have it converted into fiat currency to use it as a down payment because no bank is ever going to be using bitcoin in longterm debt due to its volitility.

If it is Fiat and you have it, then that should be all they care about so long as you can prove that you acquired the funds legally.
 
Efcjake said:
How would they know?

I would assume you would have to have it converted into fiat currency to use it as a down payment because no bank is ever going to be using bitcoin in longterm debt due to its volitility.

If it is Fiat and you have it, then that should be all they care about so long as you can prove that you acquired the funds legally.
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I think like @SerenityNigh mentioned - if its in your account for 90 days + then there is no risk. From memory they only ask for 3 months worth of statements
 
DuuuncanHadaPigeon said:
I think like @SerenityNigh mentioned - if its in your account for 90 days + then there is no risk. From memory they only ask for 3 months worth of statements
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It will vary on country regulations and the bank's own policies.

But if you convert it into Fiat and can show that you've legally acquired it then I cannot see any reason why those funds wouldn't be accepted.
 
SerenityNigh said:
No, it's because banks offer loans based on the value of the collateral (house in this case) and the credit risk of the borrower. A friend sold a highly graded Lebron James rookie card for something like $15,000 last year and the mortgage lenders wouldn't touch it for 30 days because when cash shows up in accounts without a prior history, they want to make sure there's no unposted debt that matches it.

There may be some element of conversion risk--if your banker can't figure out how much your crypto will be worth in 30-60 days when the sale happens, they don't want to underwrite any risky transaction. What if there's a dip and you're just a little short? Bankers like the easy math (not because they're stupid, but they may play dumb on purpose.)

There's also probably some question about where the money comes from--in the US for instance if you generate your cash through illegal activities the Feds can still come in and seize property. This has created an interesting/weird economy in Colorado in recent years because selling marijuana is legal in CO but it's still a US crime. So banks won't house any money for the businesses/owners because they don't want to risk it being seized by the Feds*. People who generate legitimate income through these related businesses will take their cash and buy houses/land/property in a cash sale; now the property can generate income that has no risk of recapture or it can be sold and the money is "laundered."

But the main issue is proving credit worthiness, so cash out your crypto and let it sit on a balance sheet as actual fiat currency for 30-90 days and you'll get around this issue.

Also, on the second comment, just no. Banks don't create currency, they hold currency. They create credit/liquidity. Banks will gladly hold your funds or lend you funds, but are risk averse, and they apply their risk aversion equally to personal credit risk and bureaucratic legal risk. Banks don't really care where your money came from so long as it doesn't put them at risk.

*this may have changed recently, but this was the case even a few years ago
Click to expand...
"risk averse,doesnt put them at risk" ?
this is not what happened in 2008 when banks were lending trillions to anybody that wanted it and caused a economic meltdown.
its happening again now in china,evergrande owe money to over 100 chinese banks!
the central banks will just print more and more to bail them all out though,raise the debt ceiling higher and higher,and the whole thing is going to explode,once again,its beginning again now!
this is just the start,empty shelves in supermarkets,gas and electricity prices going up.
they might try to blame brexit,lorry drivers or climate change but its caused by rampant inflation due to endless money printing.
i predicted this on here 6 months ago!
 
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