Decentralized mortgage lender Bacon Protocol has minted its first seven mortgages as non-fungible tokens or NFTs, offering investors and borrowers new ways to access the residential mortgage market.

The interest rate on any NFT mortgage ranges from 1.5% to 3.1% for real estate in four states, the company announced on Wednesday. This is the interest rate borrowers pay after they mark their mortgage using the Bacon Protocol. For comparison, Freddie Mac said the average mortgage rate in the United States for the week ended November 10 was between 2.27% and 2.98%. The 30-year fixed-rate mortgage peaked on October 28 at 3.14%.

Bacon’s decentralized mortgage platform, launched in September, offers homeowners the option of swapping a lien on their property for an NFT that represents part of its value. In May of this year, the blockchain startup Propy was the first company to launch a real estate NFT that offers a specific use case for smart contracts in the housing market. While Propy is auctioning a physical apartment as an NFT, Bacon Protocol is coining mortgages to finance residential real estate.

Bacon Protocol NFTs are based on smart loans developed by platform provider LoanSnap, which uses artificial intelligence to determine mortgage eligibility. “The NFTs work by wrapping the lien on the house while the protocol then loans against the NFT,” explained Bacon Protocol. Once a mortgage NFT is minted, it is sent to the homeowner, who then makes payments directly to the Bacon log.

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More than a decade after the 2008 financial crisis, punctuated by the collapse of subprime mortgages, the residential mortgage market seems ripe for a disruption. Not only does Bacon Protocol offer homeowners the ability to exchange a lien on their property for an NFT at lower interest rates, but it also intends to facilitate investments in the market through its bHome token, which is supported by USD coins, liens and loans on US dollars. Real estate is covered.

The co-founder of the Bacon Protocol, Karl Jacob, said, “The aim is not to replace the mortgage industry, but to build it with new technologies,” adding that “NFTs and smart contracts are a perfect fit for the credit world as they have many legal agreements in the real world are similar”. Property, with improved technology and functions. “