Health Factors

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Health Factors
What's a health factor?
An account's health factor is a measure of the account's collateralization levels. It is based on the account's total liability value, collateral value, and collateral liquidation factors.
To originate a loan, a user must ensure their health factor will be above 1.10 after the loan has been originated. If a user account's health factor falls below 1.00, their positions can be liquidated until their health factor reaches 1.02. See a rough health factor scale below:
An accounts health factor is calculated with a user's liability value (outstanding loan value + accrued interest), collateral value, and the loan-to-value ratio of their collateralthis formula.
H=∑i=1∣C∣LtVi∗Vci∑i=1∣L∣VliH=\frac {\sum^{|C|}_{i=1}LtVi*V_{ci}} {\sum^{|L|}_{i=1}V_{li}}H=∑i=1∣L∣​Vli​∑i=1∣C∣​LtVi∗Vci​​
Where:
​H=H=H=
 the account's health factor
​∣C∣=|C|=∣C∣=
 the number of collateralized assets held by the account
​LtVi=LtV_i=LtVi​=
 the loan-to-value ratio for collateral asset iii
​
​Vci=V_{ci}=Vci​=
 the collateral value of collateral asset iii
​
​∣L∣=|L|=∣L∣=
 the number of outstanding loans held by the account
​Vli=V_{li}=Vli​=
 the liability value of loaned asset iii
​
Liquidation factors are assigned to supported assets by the protocol, and they govern the point at which an account's positions can be liquidated.
How can I increase my health factor?
A user can increase their health factor by depositing more collateral or decreasing their liability value (e.g. repaying their loans).
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Liquidations
Last modified 7mo ago
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What's a health factor?
How can I increase my health factor?