When offering a loan, lenders have the convenience of submitting one or more offers with their preferred amount and LTV (Loan-to-Value). They can then patiently await the acceptance of their loan by a borrower.
LTV (Loan-to-Value) is a very important ratio when lending, we advise all lenders to understand the concept before submitting an offer.
What happens to my ETH when my loan offer is accepted?
Your ETH remains in Volt smart contract until it is accepted in a loan offer. As soon as it gets accepted, it will then be instantly sent to the borrower's wallet for them to use it.
What happens to the ETH if the loan is paid back?
Once the repayment is confirmed, the lender receives their ETH lent back in full plus interest minus protocol fees automatically in their wallet. The borrower transfers the loan amount plus any accrued interest, back to the lender's designated wallet through the Volt smart contract.
With the successful repayment, the lender's involvement in the loan concludes. The lender retains their ETH without any further obligations related to the specific loan agreement.
What happens to the borrower's tokens if the loan is not paid back?
In the event of loan default, the lender will have the option to foreclose the loan, receiving the tokens utilized as collateral.
Note that loans are not automatically foreclosed. Lenders will have the option to manually initiate the foreclosure process as soon as the loan timer goes to 0 (but they might choose to not do so). As a result, there may be a limited window of time available for borrowers to address and resolve any potential issues before the loan is foreclosed.
How to lend on Volt
Open the website https://volt.ag and connect the wallet of your preference;
Choose "Tokens";
Go to "Loans" page and select Lending tab;
Choose the Token to which you want to provide liquidity for and click "Lend";
Follow the steps, sign the transaction, and you're done!
To lend, enter both the amount of ETH you would like to offer in total as well as the LTV that you want to offer it at. LTV is based on the current price of the token, so after you submit, it is important to watch the price of the token after you submit as the LTV will change.
Borrowers can take portions of your loan offer, so there is no need to try and match the amount you lend with the amount you think borrowers need.
Manage your loans by sorting through Pending and Active loans on the "Manage" tab!
