> For the complete documentation index, see [llms.txt](https://docs.smardex.io/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.smardex.io/p2p-lending/using-the-protocol/borrow.md).

# Borrow

## How to Create a Borrowing Proposal

1. **Choose your collateral** (any ERC20 token) and deposit it.
2. **Select the asset** you want to borrow.
3. **Define your loan terms:**
   * The [Loan-to-Value (LTV) ratio](#user-content-fn-1)[^1]
   * The fixed interest to be repaid
   * The funding deadline
   * The repayment deadline
4. **Pay the fixed fee of 50 SDEX**, which is burned immediately upon proposal creation.
5. **Submit your offer** — it is instantly visible on-chain.
6. [**Receive funds from lenders**](#user-content-fn-2)[^2] once they accept your terms.
7. **The proposal can be cancelled** at any time as long as it has not yet been funded.
8. **Repay before deadline** (principal + interest) to recover your collateral.
9. **In case of default**, lenders can claim your collateral via smart contract.

***

### **Borrower Protocol Rules**

* **Set your own LTV**: There is no minimum collateral requirement — you choose your Loan-to-Value ratio. Lenders will evaluate the risk.
* **No liquidation risk**: Your collateral stays locked until the repayment deadline, regardless of price movements. It can only be claimed if you fail to repay on time.
* **Flexible repayment**: If multiple lenders funded your loan, you can repay them one by one in any order. Each repayment unlocks the matching share of your collateral.
* **SDEX fee is adjustable**: The creation fee (default 50 SDEX) can be updated by governance, but will never exceed 1,000,000 SDEX. This keeps participation fair, even if the token price changes.

[^1]: The proportion you wish to borrow relative to your collateral’s .

[^2]: Your loan proposal can be funded by multiple lenders, each contributing a portion of the total amount. The proposal may also be only partially filled, depending on lender participation.