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Showing bitcoin "assets"
Alright everyone, well long story short I am buying a personal property at the moment. Earlier this year I cashed out enough bitcoin to pay off a car loan in anticipation of buying a house. At first they simply asked for proof of transaction, ok easy, printed off a paper with me signed in showing the specific dollar amount sold and withdrawn to my checking account. Now they want quarterly statements and proof the funds are mine along with asking to show all current assets in it.
What the crap do I give them? What they are asking for quite literally does not exist. I can print a "statement", but it's just going to say x amount of btc was transferred into this account, cool that tells you nothing more than what I've already given them.
I know this comes down to them just not comprehending how bitcoin works, but how do I give them enough to make them happy? Or maybe even just how should I explain it to make them realize what they have is all that exists to give.
Hey Michael,
Are the asking for proof of funds or proof of payment of the car loan? I would assume the former since providing proof of the paid off car loan should be fairly easy. If they are asking for proof of funds, I can't really imagine them accepting any type of account statement for bitcoin even if you could figure out some way to generate it. Your best bet is to explain the situation to a loan officer, and see if those funds being included is critical to the loan. If it is you may be stuck cashing out the total amount, to be able to provide proof of funds. Not many lending institutions consider bitcoin a reliable currency or asset, so this my just be their attempt at "playing dumb"
Adam
Well just to clarify this, I cashed out enough bitcoin to pay off my car. Cashed it, paid off car, provided them with the letter from the lender showing car was paid off. I have enough money in checking currently to cover all loan expenses and have plenty left over. Whether I do or do not still have bitcoin is completely irrelevant as far as they are concerned. I have no idea why they are asking for proof of assets on this.
I mean I just have no idea what they are looking for on this, and quite frankly I don't think they do either.
This is the email that I received asking about it today. I actually just got another email from her 2 seconds ago telling me she will have to "research it". Hopefully in her research she will realize there is nothing to give her. I realize that they have to inquire about recently deposited funds used to purchase the house, but #1 it isn't being used to purchase the house #2 an explanation/proof has already been given.
-Paperwork regarding the Coinbase withdrawal. Do you receive a monthly statement showing the account information? I am not familiar with this type of withdraw so not sure what to request. We usually need a two month history of the asset account showing the funds in the account before the withdraw.
Again, why does she a 2 month history? The transaction has nothing to do with the purchase of the house. On top of that, it is literally impossible to show a "history" on bitcoin.
I'm more than willing to help them and provide any info I can, but that has already been done on my end. Proof of the cashout into my checking account is the only type of documentation that exists.
They want to make sure that the asset you used to pay off your loan was yours for 60 days prior to paying off the car loan, versus say someone else providing you a gift to pay off the car loan.
You could try giving them a print out of your Coinbase transaction history showing that the coins were not moved prior to you cashing them out.
Originally posted by @Jeremy Rusnak:
They want to make sure that the asset you used to pay off your loan was yours for 60 days prior to paying off the car loan, versus say someone else providing you a gift to pay off the car loan.
You could try giving them a print out of your Coinbase transaction history showing that the coins were not moved prior to you cashing them out.
Well the coins were certainly not kept in my coinbase wallet(mt gox anyone?), so providing them with that is also impossible.
I don't exactly see them comprehending a paper wallet when they barely know what bitcoin is. Any ideas?
I think the main thing is for them to know the coins were yours for a certain time period before you paid off the loan.
Maybe a copy of the blockchain transactions showing you move the coins into your paper wallet and then back out to Coinbase prior to converting them to pay your car loan? This would give you a third party source to show when you originally acquired the coins.
I keep most of the coin I am going to need for these kind of purposes on Coinbase partially for this reason, it's easier to show the trail and point to a US company than try to explain paper wallets and all of that stuff. Unfortunately have to take a little more risk to make sure the coins can actually be used.
Unfortunately at this stage, especially when you involve RE transactions, leveraging things like bitcoin means your part evangelist by default.
Originally posted by @Jeremy Rusnak:
Maybe a copy of the blockchain transactions showing you move the coins into your paper wallet and then back out to Coinbase prior to converting them to pay your car loan? This would give you a third party source to show when you originally acquired the coins.
This should work.
I think someone uploaded something to where an underwriter could see it, without really thinking it through @Michael Garnto. It's like a bullet leaving a gun when an underwriter sees something, can't be undone, and most mortgage software wont even let the underwriter delete things from the file if she wants to.
Once she sees reason to believe there's an account with some assets in it, boom the standard 2 months most recent, or quarterly, statement and all that.
I'm going to guess that your bitcoin account is overseas, and thus doesn't follow normal US laws for financial institutions re: regular statements showing account history and whatnot. Do they give you any sort of annual statement? You might be able to use annual statement + transaction history from Dec 30th to present to make it work.
If the funds cannot be sourced adequately, what often happens (as a sort of compromise alternative to "loan denied") is that the will pretend they never saw the money and subtract that amount from your current balances. In your case, since you've ALREADY paid off your car with that money, they will still subtract it again... meaning they are pretending you paid off the car twice, in effect, and are looking what assets you have remaining in this imaginary world wherein "+$10k - $10k = +$10k - $10k - $10k."
About three months ago there was a case wherein some folks used a cell phone app to consolidate each person's portion, and pay their rent from there. So I had to write a letter and put it in there basically explaining what a cell phone is, explaining what an app is, explaining why the cell phone app doesn't give monthly bank statements, bla bla bla. It was a big huge freaking fight internally but we got it done and funded. Is your gal or guy the "big huge fight" type of person?
Really what needs to happen is Fannie Mae needs to chill the F out and update their guidelines to understand that it's the year 2016, and things like bitcoins and cell phones aren't just for terrorists and money launderers.
Personally, I don't understand the problem, the debt is paid off, your income to debt ratio is what it shows with the debt removed. I'd let them worry about it if they can't understand it. The debt is gone, what difference does it make if you paid it off with a cash gift from your grandmother, a bag of money you found in the back of a cab or with your bit coin?
At this point it would have been better to keep the bitcoin than pay off the car!
I've recently had similar issue with US Treasury Savings Bonds of all things. I had about $35,000 in face value US savings bonds series I - that I bought between 2000 -2003. They paid anywhere from 2%-3.5% plus inflation for the last 15 years. So I ended up with about $70,000 value in these. When I bought them I got $1000 denomination paper bonds. Eventually I mailed them in and converted to US Treasury Direct account. The problem is the US Treasury has crappiest most worthless online interface I've seen. There is no mechanism to print statements nor any mailed statements. When I sold them for a down payment, I had to take screen prints from the web site and show the resulting deposits in my checking. Now they want transaction "history" showing I held them for two months at least before I cashed them. I'm going back and doing screen prints from the web site. As cheesy as they are, that's all I have to prove my $70,000 from >15 years ago + interest. The other bad news (?) is all the interest is deferred and I have to pay this tax year at regular income rates around 33% for my bracket.