17 articles in this collection
To start borrowing on LZ Lending, all you need is a collateral asset to secure your loan. You can never borrow more than the value of your collateral.
Further, you’ll need to complete KYC verification. It’s a fully automatic process that takes only a couple of minutes.
You can borrow BTC, ETH, XRP, BCH, LTC, USDT, TUSD, USDC and DAI.
No, LZ Lending is not running a credit check.
LZ Lending doesn't run a credit check since there is no personal guarantee on loan. The loan is secured by cryptocurrencies, like Bitcoin, provided by the borrower to collateralize their loan.
It's a common thing in asset-backed lending to secure your cryptocurrency loan with higher-value collateral (over-collateralization). A ratio of the amount of loan against the market value of the asset is a Loan-to-Value ratio (LTV).
On LZ Lending, a borrower can set up an LTV ratio in the range from 5% to 70%. Lower LTV ratio increases the chances of loan approval and lowers interest rates. In case of a market fall, your crypto isn't likely to be liquidated to secure the lender's investment. Higher LTV means that borrower will have to act rapidly in case of a terrific market situation. The good news is that LZ Lending won't give you a chance to miss out on this.Formula to calculate LTV:
LTV = (Loan Amount) / (Collateral Value)
Go to My Loans, select the loan you would like to pay and click on the "Pay" button for the instalments to be paid.
On LZ lending you can borrow as much as you want the number of loans at a time.
LZ Lending will automatically try to deduct your payment from current balance; if your balance is 0, we will deduct it from your collateral.
If the value of your digital asset drops enough to cause a breach of the agreed-upon loan-to-value (LTV) threshold, you will be allowed to either add additional collateral or make an additional principal payment, bringing your collateral account balance back to equilibrium. If you cannot do this, your collateral will be going to liquidate.
If the threshold for collateral liquidation is breached, a liquidation event is triggered, which is co-signed by other parties. Liquidation events may include fees which are passed along to the borrower.
Loans with LZ Lending may trigger taxable events. We suggest consulting with a licensed tax professional to determine how your LZ Lending's loan will impact your tax reporting. You can find transaction history under Wallets tab.
Yes. You continue to own your asset, but your lender features interest and hypothecation against the asset until your loan matures or is paid fully.
Yes, you can deposit any asset or collateral that we accept on our platform.
With a principal & interest loan, the borrower pays back the interest that he is paying an equivalent amount monthly until the loan matures. Early in the amortization schedule, a majority of the payment will be going towards the interest and later within the schedule; it'll go towards the principal of the loan.
With an interest-only loan, the borrower pays back the interest in the loan first. For example, in a 1-year loan, the borrower would pay only the interest of the loan for 11 payments with 1 balloon payment due for the interest and principal of the loan at the end of the loan when the loan matures.
The amount you can borrow is only limited by the collateral you have deposited in your account.
The minimum amount you can borrow is equivalent of $100.
The loan approves instantly.