How Cryptocurrency Is Impacting the Mortgage Industry
As the crypto world keeps getting more and more developed with each passing day, its real world impacts are also consequently getting more pronounced. In fact, we have come to a point where cryptocurrency is affecting a majority of real-life industries and sectors. A prime example of this is the mortgage industry which is getting heavily impacted by cryptocurrency.
There are several investors in the world who predicted these real-life changes would occur even if the currency they invested in wasn’t inherently based on real physical value. These same investors are now known as bitcoin billionaires now and have attracted a legion of other investors to invest in cryptocurrency. If you too want to be a part of these investors, you can click here to do so.
According to the https://prawica.net/trading-software/crypto-genius-recenzja-2021-czy-to-jest-legalne-czy-falszywe/, there are several ways the mortgage industry is getting affected by cryptocurrency which only serves to highlight the importance of investing in crypto early. In this article, we will be talking about this impact on the mortgage industry in detail. Read the article till the end so that you don’t miss out on any crucial details.
How is the mortgage industry actually affected by cryptocurrency and blockchain?
While we do say the mortgage industry is being affected by the “cryptocurrency” market, in reality it is only being affected by the technology of one cryptocurrency – bitcoin. The network bitcoin is based on, blockchain finds the fundamental basis of the impact cryptocurrency is having on the mortgage industry.
The traditional methods of how the mortgage industry works have become too outdated. In the traditional scenario, you are required to go through a copious amount of paperwork and wait to finally complete the procedure. This procedure can take anywhere between 1-3 months and during this period, there is a large margin of human errors occuring which can cost you precious amounts of time.
Blockchain eliminates this hassle by making the entire process digital. If blockchain gets integrated into the mortgage industry, all an applicant would need to do is fill out an application. This application would become a part of the blockchain and pass through various nodes that verify its security.
The lender would receive this loan application and all he would need to do is just sign it. With the approval of the signature, the required loan funds will be automatically directed towards the applicant from the party that is facilitating the finances of the loan.
This entire process has the possibility to be done in a matter of minutes, which would, in real life, take a few months to complete at the very least. Thus cryptocurrency has the full potential of affecting the mortgage industry deeply if only government agencies decideo to create public blockchains and give full permission to integrate DLT into the industry.
Benefits for using cryptocurrency in the mortgage industry
There are several benefits for using cryptocurrency in the mortgage industry, some of which we would see presently:
Enhanced record storage
Traditional record storage in mortgage loans not only involves a lot of paperwork but also has a considerable chance of getting mishandled and tampered with. This is impossible to do on a blockchain as each block is encrypted and stored as a record. It can only be read by relevant protocols and nodes when the users access these blocks.
These encrypted track records keep your data safe and also provide easy access to who the borrower, lender and approver was, which cannot be incorrect.
Getting a mortgage loan in real life is not at all a seamless process. You need to spend considerable amounts of time and effort around banks that can provide you a mortgage at a decent enough rate. Third-party agencies can help people like these obtain a mortgage loan at a better rate that more easily, but they also take a healthy amount of fees for doing so.
With the mortgage industry completely digitized by the blockchain, you can be assured that your mortgage loan will cost considerably less than before.
Settlements that occur instantaneously
Mortgage funds are quite large and to facilitate their transaction in a safe manner takes a considerable amount of time – liberty many people don’t have. A mortgage process based on the blockchain will ensure instant monetary transfer as soon as your application gets approved which can save large amounts of time for both parties.
Instead of signing multiple documents and agreements in an offline and physical contract, you can simply sign the smart contracts offered by your mortgage lenders. These smart contracts are much easier to use, edit and access. Since they are online, the process is also extremely minimal.
Signing the smart contract can take anywhere between a few days to a few weeks depending on the office.
What aspects are necessary for integrating cryptocurrency into the mortgage industry?
Blockchain is still an extremely new technology and for integrating it with the mortgage industry, there are several aspects that need to be taken into consideration. These aspects are:
- Blockchain awareness – As we previously said, blockchain is still relatively new and in order to utilize it for mortgages, banks need to have staff that can properly understand the technology and know exactly how it works. A part of this awareness is also understanding the crucial difference between cryptocurrency and blockchain.
- Established framework – The sturdier your internet web framework is, the more your bank will be able to facilitate blockchain into their transactions. It is extremely essential that your bank, who is acting as the mortgage lender or the approver, has a well-established blockchain framework in order before going through with their transactions.
- Better security – The entirety of blockchain is built separately on a network that is distributed to every bitcoin investor out there. This blockchain can be easily accessed and damaged if your system does not have proper interfaces, encryption and keys. In case a proper cybercrime occurs, your mortgage loan details and the bank should be fully equipped with protecting your details.
There are various ways through which cryptocurrency is affecting and impacting the mortgage industry one way or the other. We hope this article was insightful for you and if it was, please consider following our website for regular updates as it will help us out immensely.