Paying off HSBC mortgage with cryptocurrency profits

innerspeaker

I started putting a modest amount of money into one of the more obscure cryptocurrencies in 2018, and fortunately, it’s now appreciated to the point where I could cash out for a 6 figure profit.

I don’t intend to cash out just yet, but just want to reach out for advice as my primary goal with any profit will be to pay off or partly pay off my mortgage completely and I’m already getting anxious about this.

I’ve had a mortgage with HSBC since 2017. I’ve banked with them pretty much all my life, since they were Midland Bank in the 90s. However, I am aware from looking around online that they appear to be one of the most aggressively anti-crypto out of the major banks.

Most of my original crypto purchases were through a TSB account. My current intention is that if I cash out, I tell TSB in advance and then drop the money into that account, as this seems the cleanest way for me to get hold of the money. Once I’ve sorted my Capital Gains Tax liability I’d then move the remainder over to HSBC to clear my mortgage.

I’m terrified of HSBC suspending my main bank account that has my mortgage, salary and direct debits attached to it, so I’m not really sure how to proceed. I’m unfamiliar with what happens to a mortgage holder if their bank/mortgage lender suspends the account that the mortgage payments are coming from?

I’m an accountant by trade so I already have my paper trail completely sorted out for CGT purposes, so that will prove that the crypto was purchased by me and is 100% legitimate. And my accounts are incredibly ‘bog standard’ and clean – just a modest monthly salary and the standard debit debits really.

Any thoughts?

[Deleted User]

Oddly enough given the attention that deposits get for money lqundeting checks, ive never seen a lender care how a mortgage is paid off.  

Just transfer it through online banking or something and let the systems take care of the rest

innerspeaker

Deleted_User said:

Oddly enough given the attention that deposits get for money lqundeting checks, ive never seen a lender care how a mortgage is paid off.  

Just transfer it through online banking or something and let the systems take care of the rest

Thanks for the detail - that does seem weird:

Drop £XXXk into your bank account - trigger the ML checks
Use same £XXXk to go directly to your mortgage account - no checks at all?

On a separate note - hypothetically, if HSBC did overreact and suspend my bank account, what would this mean for my mortgage with them? Would I run the risk of default if they won't accept funds from me?

MWT

innerspeaker said:

Deleted_User said:

Oddly enough given the attention that deposits get for money lqundeting checks, ive never seen a lender care how a mortgage is paid off.  

Just transfer it through online banking or something and let the systems take care of the rest

Thanks for the detail - that does seem weird:

Drop £XXXk into your bank account - trigger the ML checks
Use same £XXXk to go directly to your mortgage account - no checks at all?

I think the suggestion was to transfer from your TSB account rather than drop it direct into the loan account.

Once you've got the cash safely within the UK banking system I don't think you'll have any problems moving it around, it is just that first step of landing it in the UK that is likely to get a lot of attention.

lonibra

I've always wondered about how anal the bank was when I need to use £10,000 gifted by my aunt (UK resident, funds sitting in her account for donkeys years) for a deposit, but had no checks or questions when I overpaid by 38k a year later which was from an overseas inheritance. 

davidmcn

lonibra said:

I've always wondered about how anal the bank was when I need to use £10,000 gifted by my aunt (UK resident, funds sitting in her account for donkeys years) for a deposit, but had no checks or questions when I overpaid by 38k a year later which was from an overseas inheritance. 

Buying property is a rather more likely money-laundering activity then repaying an existing mortgage.

MWT

I've not had any questions asked about bank to bank movement of large sums, even when the source is overseas, and no questions about original source when moving money to payoff mortgage accounts.

Moving money from well-known crypto-trading sources has been more troublesome.

So if there is an easy route to land the money in a friendly bank account then I'd always do that first and once there there should be no further problems moving it to 'unfriendly' banks.

When dealing with deposits you are of course dealing with the KYC/AML requirements of the solicitor who is representing to the lender that the source of funds has been checked so the questions are always going to be different.

Thrugelmir

innerspeaker said:

Any thoughts?

Deal with the TSB first. 

Voyager2002

I think that your plan -- pay the crypto proceeds into TSB, then repay your mortage with a payment from an established UK bank account (TSB) is a good one.

A couple of comments: do you need to pay off your entire mortgage in one go? If not, it might be wise to make a couple of smaller repayments. One advantage of this is that you reduce your exposure to a fall in the price of your chosen 'coin'. You say that you have been very lucky, and so will appreciate that your luck could turn at any point. I understand that you have reasons for not wanting to cash out immediately, but taking some of your profits now would be sensible.

ACG

Crypto to TSB
TSB to HSBC mortgage (not bank).

I cant see there being a problem. 


I put £50 in last year and im up to about £250 now. I have some way to go before I can clear my mortgage haha.