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Aaveator138
Mar 20, 2023
Experten Q&A
How does borrowing interest payment work until loan repayment?
I am trying to understand the process of paying borrowing interest until the loan is repaid. Does the interest get deducted from the collateral or does the borrower have to pay it at a predetermined frequency?
- Health Factor
- Borrow rate
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1Aaveator138
Mar 22 2023, 11:54The borrower needs to actively repay, if he does not and he falls below 1 health factor then liquidation would occur, and a liquidation would repay his debt and claim certain amount of collateral for that.
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Aave is a decentralized non-custodial liquidity protocol where users can participate as depositors or borrowers.
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