How do I repay using my collateral?

We're rolling out the repay with collateral feature under the Flexible Loan—giving you more flexibility and convenience when managing your borrowed assets. Instead of using the borrowed token directly, you'll now be able to repay your loan using selected collateral, all within a few simple steps.

Below is how it works:

1. Enter the repayment amount: input how much of the loan you'd like to repay. This amount must be less than or equal to your current borrowed balance for the selected crypto.

2. Choose collateral to cover the repayment: you'll see a list of your available collaterals, sorted by their USD value (from highest to lowest). In the repayment process, the platform will place an Immediate or Cancel (IOC) order, sell your collateral for USDT, and then use the USDT to buy back the loan token if your collateral is already in USDT. If your collateral isn’t USDT, it'll first be sold for USDT, which will then be used to repurchase the loan token. Once you select your collateral(s), repayment will begin using the one with the highest USD value first.
   
   Please note that during this process, trading fees and slippage may occur. Additionally, between the time you confirm the repayment and when it is fully processed, price differences may arise. Don’t worry—the platform won’t use all of your collateral. It’ll only use what’s necessary to meet the repayment amount, and any excess will remain in your account.
   
   Example: suppose you’ve borrowed 1,000 SOL and you want to repay 500 SOL. You select ETH (~400 SOL) and BTC (~300 SOL) as collateral. The platform will use your ETH and BTC to place Immediate or Cancel (IOC) to convert them to USDT first, then use the USDT to buy back 400 SOL. Then, use ~100 SOL worth of BTC to complete the repayment. The remaining BTC (~200 SOL) stays in your account.

3. Review and confirm: after selecting your collateral, confirm the repayment. Make sure to check your updated loan amount, Loan to Value (LTV), and ensure your LTV remains within a safe range.

4. Repayment successful: once the repayment is processed, your loan balance will be updated, and the portion of collateral used will be deducted accordingly.

Note:

• There may be a slight over-purchase of USDT or borrowed tokens during the repayment process. This happens because the system uses an Immediate or Cancel (IOC) order for conversion. Due to market volatility, the amount bought back may slightly exceed the estimated amount.

• When using OKSOL or BETH as collateral, you won’t be able to repay your loan token directly in this feature.

• As an example, in some edge cases—especially when you hold both USDT and a non-USDT loans like ETH—the platform may first convert your selected collateral to USDT (used as a transition currency), and then use the USDT to buy back the borrowed crypto.
  
  However, if the second order fails, the USDT may still be repaid, while the original borrowed crypto (for example, ETH) is not. Always double-check your final balances.

• Another edge case may occur when a repayment is marked as successful, but a very small amount of the borrowed crypto remains unpaid due to trading fees applied during the order. In this case, simply initiate another repayment using collateral to settle the remaining amount.

If you're wondering how Flexible Loan works, you can learn more here.