- Senator Lummis has introduced a bill to include crypto in mortgage approvals.
- The bill targets young buyers and aligns with FHFA’s recent crypto directive.
- Critics cite crypto’s volatility as a mortgage default risk.
US Senator Cynthia Lummis of Wyoming has proposed legislation that, if passed, would require housing finance agencies to consider digital assets in evaluating mortgage loan applications.
The bill has sparked debate on Capitol Hill, with supporters viewing it as a step toward financial modernisation and critics warning of potential risks.
Bill tied to recent Federal Housing directive
The proposed legislation, known as the 21st Century Mortgage Act, aims to codify a recent order issued by the Federal Housing Finance Agency (FHFA).
That order directed Fannie Mae and Freddie Mac, two key mortgage purchasers in the US, to factor in cryptocurrencies as part of asset evaluations for single-family mortgage loans.
Senator Lummis announced the bill shortly after the FHFA directive, stating that congressional action was needed to ensure the order becomes permanent law.
According to the senator, the bill reflects a modern approach to wealth-building, especially for younger Americans who are more likely to own digital assets than traditional property or savings.
Targeting the younger generation of buyers
Citing US Census Bureau data, Lummis noted that homeownership among Americans under 35 stood at just 36% in the first quarter of 2025.
For many in this demographic, crypto represents a significant portion of their net worth.
Therefore, the bill seeks to address a growing need to consider all forms of personal wealth — not just fiat or traditional assets — during the mortgage approval process.
The bill would allow borrowers to retain their cryptocurrency holdings without being forced to liquidate them into US dollars for mortgage consideration.
This approach, Lummis argues, keeps pace with how wealth is evolving and acknowledges the financial reality of modern young adults.
Pushback from Democratic lawmakers
Despite its potential to expand financial inclusion, the bill has faced early resistance.
Several Senate Democrats have expressed concern over the FHFA order, and by extension, the proposed legislation.
In a letter sent to FHFA Director William Pulte on July 24, they urged the agency to fully evaluate the risks and benefits of integrating crypto into mortgage evaluations.
According to the letter, a borrower who relies on volatile digital assets may struggle to convert those holdings into cash during a downturn.
That, in turn, could raise the risk of mortgage default, which would impact not only the individual borrower but also the broader financial system.
Broader crypto legislation on the horizon
The 21st Century Mortgage Act is just one of several crypto-related bills making their way through Congress.
Senator Lummis is also spearheading a separate effort to establish a comprehensive framework for digital asset markets.
Meanwhile, the Senate is reviewing another bill that would ban the Federal Reserve from launching a central bank digital currency (CBDC), following its approval in the House earlier this month.
On the House side, a similar bill has already been introduced by Representative Nancy Mace.
Known as the American Homeowner Crypto Modernisation Act, Mace’s bill would mandate mortgage lenders to consider the value of digital assets held in brokerage accounts linked to crypto exchanges during the credit evaluation process.
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