LTV & LTV liquidation threshold
1.LTV Definition
LTV stands for Loan to Value ratio. LTV is a risk assessment for lending business and is configured by lenders prior to any collateral approvals or contract generation.
The maximum loan amount depends on the the amount you deposited and the LTV ratio from lenders.
E.g. Your collateral value is 100 USD, LTV rate is 80%, this means 80 USD is the maximum amount you are able to borrow based on the value of the collateral.
2. LTV liquidation threshold Definition
LTV liquidation threshold is the maximum ration of LTV allowed. When reaching this threshold, it triggers collateral liquidation. To prevent this, it is recommended to repay partially unpaid penalty/interest/loan.
3. Your Current LTV Definition
Your current Loan to Value is the total loan amount/collateral value at the time you check it in the system.
4. Can you give me an example?

4.1 Your current LTV when there is unpaid interest (There is an interest amount for next period created when the contract is generated)

E.g. Collateral = 100 USD, LTV = 80%, LTV liquidation threshold = 95%, Current period interest= 10 USD, Current period interest = 0 USD
Conclusion: Do not liquidate collateral

4.2 Your current LTV when there is unpaid penalty

E.g. Collateral = 100 USD, LTV = 80%, LTV liquidation threshold = 95%, Current period interest = 0 USD, Current period penalty = 15 USD
Conclusion: Liquidate collateral

4.3 Your current LTV when there are both unpaid penalty and unpaid interest

E.g. Collateral = 100 USD, LTV = 80%, LTV liquidation threshold = 100%, Current period interest = 10 USD, Current period penalty = 15 USD
Conclusion: Liquidate collateral
5. How to get notification when my current LTV is going to reach LTV liquidation threshold?
Our system will send you an email notification warning if you subscribe to get email notifications before. The detailed information of your current LTV is presented in your contract detail. We advise you to always subscribe to recieve such important warnings from the system.
6. How to prevent your collateral from being liquidated?
It is recommended to keep your current LTV a safe gap to the LTV liquidation threshold to prevent your collateral from being liquidated. The LTV liquidation threshold is fixed so you can decrease your current LTV by repaying partially penalty/interest/loan.
7. When is my collateral liquidated?
The borrower's asset will be liquidated and transferred to lenders if it falls into one of the following cases:
  • Max late payment was reached 3 times
  • The current LTV has reached LTV liquidation threshold
  • Loan repayment was overdue
Last modified 2mo ago
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