Lending FAQs | Unocoin
What is Lending?
- Lending (also known as "financing") in its most general sense is the temporary giving of money or property to another person with the expectation that it will be repaid along with interest.
How Lending works on Unocoin?
- In Unocoin, the verified users will be able to obtain a loan in USDT against pledging collateral in bitcoin
Explain Loan Options?
- Two types of loans are available in Unocoin. EMI plan lets user pay their loan and interest in easy monthly instalments of 3 to 36 months. The flexible option lets users to pay the interest and principal without any restrictions on repayment time.
What is monthly Repayment Date?
- EMI plan lets you choose a date between 1st to 20th of the month on which instalment payment will be scheduled
What is collateral Amount?
- To obtain a loan equal to x USDT, Unocoin obtains collateral in bitcoin whose total value is greater than x. The value of bitcoin at the time of collateralization is called collateral amount (y).
What is Loan to Value (LTV) ratio?
- The ratio between loan amount to collateral amount is called the Loan to Value ratio
How to fill my Loan order?
- You can go to the Lending section and transfer your BTC or USDT to the lending account and it will automatically get used to pay the EMIs or to fill the loan order.
Can I withdraw amount from loan order anytime?
- The amount transferred to a loan account can be withdrawn if that loan account have more money than the dues to be paid. However, if the amount transferred to the loan account is sufficient to close the loan account, the loan account will automatically get closed (if Flexible loan) any more balance in the loan account will be credited to the respective wallets.
What happens if value of my crypto asset increases or decreases?
- If the value of the collateral decreases below a notification threshold, then you would get notifications on email and if it falls below the liquidation threshold, then the btc if present in the lending wallet gets added to the loan account collateral or else the collateral will get liquidated to pay off the loan.
What is Liquidation?
- Selling off of the collateral because the loan did not get paid in time or if the value of the collateral falls below liquidation threshold and you do not add more collateral to your lending wallet to avoid liquidation.
How will I know my order is liquidating?
- You will get multiple notifications as soon as the price of the collateral falls below the notification threshold and the message will also inform about the liquidation threshold details.
How to refinance my order to avoid Liquidation?
- You can go to the lending section and add more collateral to lending wallet to avoid the liquidation.
What are all the minimum and maximum values in Lending?
- Minimum and maximum values are mentioned in fees page
What happens if I do an early Loan Payment?
- If you do the early payment of EMI, it will only get paid to the loan on the date of the monthly repayment date.
What are the advantages of early loan payment?
- You can close the loan by paying all the pending fees, penalties if any, pending EMIs in case of EMI plan or pending principal and interest in case of Flexi plan. This will make the collateral to be released immediately and it will be added to your wallet.
How many loans can I borrow for the same pair at the same time?
- You can apply for the 2 loans for the same pair at the same time and keep them active
What happens if I pay more amount towards loan?
- It will be held in the loan account and will be used to pay any pending dues on the due dates
When will interest applied to your loan?
- For EMl plan, the interest is already factored in for calculating the EMI itself. For Flexi plan, the interest is applied daily
How interest calculated for EMI?
- The interest and principal payment schedule are calculated based on which the EMI will be determined. It is very similar to how the banks determine EMI for home or vehicle loans.
Who is eligible to take Unocoin Crypto Loan?
- All verified active account holders are eligible for the crypto loan
How to avoid Liquidation of my collateral?
- By making sure to add more collateral to lending wallet whenever the price of collateral is decreasing and/or when the notification warnings are received.
Is there a penalty for early payment?
- There is no penalty for early payment of the loan
What are the benefits of Unocoin Crypto Loan?
- It provides you with the liquidity of USDT for other need without selling the bitcoin.
What all pairs available presently for Lending?
- The only pair presently available is to borrow USDT against providing bitcoin as the collateral
Can I preclose my loan? How?
- You can pre-close your loan by paying all the pending fees, penalties and all EMIs (in case of EMI plan) or interest and principal in case of Flexi plan. Just add the USDT amount to the loan account and the pending payments get taken off. To explicitly pre-close, the loan, use the options in that loan details screen but have enough USDT in the loan account to get all the pending payments covered. You can also pre-close the loan by using the collateral itself. The BTC sufficient to close the loan will be liquidated and paid into the loan account to close it. The remaining BTC will get added to the user wallet.
What happens if I not able to repay the loan?
- Penalties and interests are added if the payment of the loan is not made on schedule. If the loan do not get cleared by the loan closure date, then the collateral that is equal to the pending payments is liquidated to close the loan and the remaining collateral will be credited back to your wallet.
How long does it takes to get loan amount?
- Borrowing USDT by providing the bitcoin as collateral is instantaneous.
Is there a penalty for late payment fee ?
- Late fee charges is mentioned in fee page.