If a borrower misses a payment, SALT automatically liquidates a portion of the total collateral to cover both the missed payment and any associated fees. If a borrower continues to miss payments, the collateral will continue to be liquidated to cover monthly payments of principal, interest, and fees until the loan-to-value ratio exceeds a predetermined threshold. Once the default reaches the triggering threshold described above, a balance of the collateral is liquidated to cover the missed payment and to calibrate the over-collateralization. This process continues until the loan is fully retired or matures. Lenders may elect to receive their funds in either the currency of the original loan or the equivalent value in blockchain assets. After the principal of the loan and accrued fees are paid out of the collateral, any remaining assets are returned to the borrower.
Articles in this section
- How long does it take to get approved for a loan?
- What states and countries are your product available in?
- Can I use SALT Membership Units to payoff my loan?
- I want to pay off my loan but I can't see the steps in my dashboard. How do I do that?
- Can I receive my loan payout in stablecoin?
- Can I use different collateral types for my loan?
- Why is my bank information still "Pending"?
- How are the LTV margin triggers determined?
- What do I need in order to apply for a loan?
- What determines my LTV & How to respond