FAQ on Fixed Rate Loan

Announcements FAQ on Fixed Rate Loan

2024-01-10 09:11:59 UTC 19371 Read

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### 1. What is Fixed Rate Loan?

Fixed Rate Loan is a loan product with fixed investment terms and fixed interest rate. Compared with loan products with flexible interest rates, its strength lies in the fixed interest rate. Currently, Gate.io provides 7-Day and 30-Day Fixed Rate Loan products.

### 2. Are there single-collateral fixed rate loan products?
Fixed Rate Loan products are currently all multi-collateral, but you can collateralize only one coin to realize the effect of "single-collateral" fixed rate loan products.

### 3. How to calculate the interest of fixed rate loans?
The fixed interest rate is the actual market interest rate when you borrow funds successfully. During the loan term, this rate stays unchanged. Interest is calculated based on the loan amount and the fixed interest rate every hour on the hour. You can repay the loan in advance, and the interest will be calculated based on the actual loan period. Early repayment will not incur any fines.

### 4. Is auto-repayment available on fixed rate loans?
Yes. Enable Auto Repay and the system will automatically transfer spot assets to repay your loans at maturity to avoid overdue repayment. It is worth noting that if you do not have enough spot account balance, overdue loans could still occur.

### 5. Is auto-renewal available on fixed rate loans?
Yes. Once you enable Auto Renew, an borrowing order will be placed automatically after this order reaches maturity. The interest rate of the new order will be the latest interest rate in the borrowing market, which could vary from the original one, but the investment term will not change. For example, if you subscribe to a 7-day fixed rate loan product, after the auto-renewal, the new loan order will be a 7-day fixed rate loan order with the latest interest rate in the market.

### 6. What will happen if the loan is overdue?
If you haven't enabled Auto Renew before maturity and fail to repay the outstanding loan amount at maturity, your loan will be overdue. Under such circumstances, you will have a grace period of 48 hours (the hourly interest rate will be 3 times of the original one). However, if you still do not repay all the outstanding amount after 48 hours, your collateral will be sold for repayment.

### 7. What will happen if the LTV of the fixed rate loan order hits the liquidation LTV?
As fixed rate loan orders are all multi-collateral, the liquidation mechanism is the same as that of Multi-Collateral Loans. When your LTV reaches 90%, the system will start to liquidate with the tiered liquidation mechanism. This mechanism will not sell your collateral at at once in liquidation. Instead, it will liquidate in the descending order of the value of outstanding loan (principal plus interest). The loan with the largest value will be dealt with first. The order of selling different collateral is similar. The collateral with the largest value will be sold first. The platform will check the LTV after selling to see if the LTV is back within the liquidation LTV. If yes, liquidation will stop; if not, liquidation will go on.

### 8. When an alert is triggered or an order is being liquidated, will I receive a notification?
Yes. When an alert is triggered or your order is being liquidated, you will receive a direct message and a notification email. Moreover, we will also send you notifications when your loan is about to reach maturity, when your loan is auto-repaid, when your loan order is auto-renewed, and when your loan is overdue.

Gate.io reserves the final right to interpret the product.

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