Good point, so there probably would still be some interest to make it worth while for lenders, who have the excess.

On the borrower side, I think borrowers would be more selective in their borrowing.

So in this scenario, maybe he thinks the house will pay itself off, and generate revenue, or locate him where he can generate more revenue. However... unless he can get multiple loans from that same stack, or still use it, I can't think of a good reason he wouldn't just pay if he already has the money. Besides what you mentioned, the illusion of still having 2 bitcoin. Or maybe onchain fees are so high it makes sense to get the loan in lightning (or whatever) that's a more liquid assets short term?