Skip to main content

Repay a Loan

You must repay a loan and all interest before the due date to avoid defaulting. If you no longer need the funds or want to improve your health factor, you may also repay a loan early, either in full or partially.

  1. Navigate to the loan page and find “Repay”.
  2. Enter the amount you’d like to repay.
  3. Click “Repay” to execute a repay, prompting a transaction signature. You should see the displayed outstanding value and health factor increase

Early and Partial Repayments

Borrowers must still repay a percentage of the original interest (5%) on any early repaid amount. The new amount due is shown as “Penalty added” when repaying.

As an example, consider a user borrows 100andexpectstopay100 and expects to pay 10 in interest in 10 days, on the loan's due date. After 5 days, he pays 50early.Thismeansthatinsteadofowingtheoriginalinterestonhalfoftheloanforhalfoftheduration,50 early. This means that instead of owing the original interest on half of the loan for half of the duration, 2.50 (10×12×1210 \times \frac{1}{2} \times \frac{1}{2} ), he only owes 0.125(0.125 (5% \times $2.50$).