Notional V3 User Docs
  • Product Guides
    • Lending
    • Fixed Rate Lending
    • Providing Liquidity
    • Borrowing
    • Fixed Rate Borrowing
    • Leveraged Liquidity
    • Leveraged Yield Farming
    • Leveraged Points Farming
    • Leveraged Pendle PTs
  • Risk Framework
  • Developer Docs
  • 🏦Prime Money Market
    • Overview
    • Interest Rate Model
    • Borrow Fees
  • 💸fCash
    • What is fCash
    • Using fCash
    • fCash Maturity
  • 💹Trading fCash
    • Transaction Fees
    • Exiting Early
    • Interest Rate Risk
  • 💰Borrower Resources
    • Loan to Value (LTV)
    • Health Factor
    • Liquidation
    • Max LTV Table
  • 🚰Fixed Rate Liquidity Pools
    • What are Fixed Rate Liquidity Pools
    • Fixed Rate Liquidity Pool Mechanics
  • 🪙nTokens
    • What are nTokens
    • nToken Mechanics
      • nToken Portfolio
      • Minting nTokens
      • Redeeming nTokens
    • nToken Returns
    • nToken Risks
  • ⚡Leveraged Vaults
    • What are Leveraged Vaults
    • Entering and Exiting a Vault
    • Liquidation
    • Settlement
    • Vault Returns
    • Vault Risks
    • Vault FAQs
  • ⚖️Governance
    • NOTE
    • NOTE Staking
  • Smart Contracts
    • Deployments (Mainnet)
    • Deployments (Arbitrum)
    • Audits
    • Bug Bounty
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  1. Borrower Resources

Loan to Value (LTV)

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Notional is an overcollateralized lending protocol. This means that the maximum amount you can borrow is less than the total value of your collateral. Your Loan to Value (LTV) is the value of your loan in USD divided by the value of your collateral in USD.

LTV=loanValue/collateralValueLTV = loanValue / collateralValueLTV=loanValue/collateralValue

For example, if you borrowed 100 USDC against 200 USDC worth of ETH, your LTV would be 50%.

// Example LTV calculation

loan value = 100 USDC
collateral value = 200 USDC

LTV = 100 / 200 = 0.5

Max LTV

The maximum amount you can borrow against your collateral is called the Max LTV. If the Max LTV was 75%, you could borrow another 50 USDC before you would reach your max borrow capacity.

// User at Max LTV of 75%

loan value = 150 USDC
collateral value = 200 USDC

LTV = 150 / 200 = 0.75

Your Max LTV depends on what assets you're using as collateral, what you're borrowing, and Notional's risk parameters.

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