Size Credit Docs
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    • Lending (Buying Credit)
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    • The Yield Curve Order Book
      • Bids & Offers
      • Rate Hooks
      • In What Situations Are Bids and Offers Filled?
    • Offsetting Debt with Credit
    • Position Health & Liquidations
    • Technical Docs
      • 1. Core Components
      • ♾️1.1 Fixed-Rate Order Book (FROB)
      • ♾️1.2 Limit Orders
      • 2. Accounting System
      • ♾️2.1 Deposit Tokens & Global Trackers
      • ♾️2.2 Loans
      • ♾️2.3 Fees
      • 3. Mechanisms
      • ♾️3.1 Deposit & Withdraw
      • ♾️3.2 Limit Orders / Offers
      • ♾️3.3 Market Orders
      • ♾️3.4 Repayment
      • ♾️3.5 Liquidations
      • ♾️3.6 Claim
      • 4. FAQ
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  • Loan Health
  • Overdue Loans
  1. How It Works

Position Health & Liquidations

Position health can be monitored on the Positions page.

Loan Health

Fixed-rate loans use a collateralization ratio (collateral / debt) to measure risk. If the collateralization ratio drops below the liquidation threshold (i.e. 130%), all fixed-rate positions owned by that borrower become eligible for liquidation.

Positions are liquidated one at a time, and the liquidation threshold may rise back above the liquidation threshold if the liquidation is not unprofitable, giving the user another chance to supply more collateral.

Overdue Loans

Loans not paid back by the due date also become eligible for liquidation. However, a smaller penalty is applied, assuming the loan remains well-collateralized.

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Last updated 11 months ago