Liquidation
Liquidation conditions
Lend Flare begins to liquidate the collateral assets if the repayment date exceeds the specified loan term and the repayment hasn’t been made .
The borrower can repay the loan before the specified repayment date
If the borrower's loan is past due, Lend Flare will liquidate assets first, and the LP that has been collateralized to Curve will be converted to the target asset. The liquidation fee is borne by 0.1 ETH pledged by the borrower when borrowing and the Lend Flare team. The liquidation process is done automatically and the contract is activated by the Lend Flare bot (users can also do this themselves, they will have 0.1 ETH reward). After the collateral is converted to the target asset, it is used to pay Lend Flare interest and principal. It will then be sent over to Compound in order to continue earning interest. Extra amount will be divided equally among the VeLFT holders and liquidity providers.
The interest that generated during borrowing period will be given back to borrowers after liquidation.
Last modified 1yr ago