> For the complete documentation index, see [llms.txt](https://docs.folks.finance/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.folks.finance/architecture/loan-borrow.md).

# Loan borrow

After a user has locked up their collateral, they can borrow against it. The amount the user has borrowed of a given asset is defined as $$B\_t$$​ whereas the borrow balance of a given asset $$BB\_t$$​ is defined as the amount borrowed plus accrued interest.

The borrow factor $$BF$$​ represents the effective borrowed amount given a borrow, in percent terms. For example, a more volatile asset may have $$BF=110$$​% (for $10 borrowed, it is as if $11 has been effectively borrowed) whereas a less volatile asset may have $$BF=100$$​%.

Consider a user who borrows multiple assets. The total borrowed amount $$TB\_t$$ at time t for a given loan’s borrows is:

$$
TB\_t=\sum\_{i=ASSET,V/S}^{borrowed}BB\_{t\_i}*P\_i*BF\_i
$$

Where:

* $$BB\_t$$ denotes the current user borrow balance of a borrow,
* $$P\_i$$ is the price of the borrowed asset,
* $$BF\_i$$ is the borrow factor,
* the subscript $$i$$ represents each borrow of the loan where a borrow is a unique pairing of asset and variable/stable rate.

The total borrowed $$TB\_t$$ must not exceed the borrowable amount $$BA\_t$$, otherwise the loan can be liquidated by a third party:

$$
TB\_t \leqslant BA\_t
$$

If a borrow or reduce collateral operation would lead to the above condition being violated then it will be rejected by the protocol.


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