Buy Now Pay Later (BNPL) allows you to buy an NFT using borrowed funds. Once you’ve borrowed funds using BNPL, or by borrowing directly using an NFT you already own, your borrow balance will start growing at an interest rate based on your loan terms. 

Example: If you borrow 10 ETH at a 0.05% daily interest rate, your borrow balance will grow from 10 ETH to 10.15 ETH after a month.

Eventually, you may want to repay your borrow to take full ownership of the NFT. Or, you can sell your NFT and keep any profit remaining after your borrow balance is repaid as part of the sale.

Example: If you sell your NFT for 12 ETH a month after borrowing 10 ETH at a 0.05% daily interest rate, you’ll keep 1.85 ETH and 10.15 ETH will be used to repay your borrowed balance.

In certain cases, you may be called on to repay or refinance your loan by your lender. This can happen at any time, but it will most likely happen if the floor price of your NFT has fallen.

Example: If you borrow 10 ETH when the floor price is 12 ETH, and then the floor price falls to 10.5 ETH, the lender may call on your loan because the floor price is too close to the amount they loaned you.

When this happens, an automatic process will kick off to find a new lender for your loan at similar terms to your existing loan. If a new lender is not found within 6 hours, you’ll need to repay or refinance your loan within 24 hours (make sure you turn on email notifications to get this alert). 

You can repay directly from your Portfolio page. Currently, you must repay the full amount of your borrowed balance, but in the near future you’ll be able to repay partial amounts to extend your loan at new terms.

Example: You borrowed 10 ETH and the floor price fell to 10.5 ETH. Your lender called your loan, so you repay 1 ETH and extend your loan with a new, lower borrowed balance of 9 ETH.

If you don’t want to repay your loan, you can also refinance your loan with a new lender. This process happens automatically based on the available loan offer, which you can see on the Loans tab of the collection page. To be explicit, if there are loan offers available, NO ACTION is required on your part to refinance your loan.

Example: You borrowed 10 ETH and the floor price fell to 10.5 ETH. Your lender called your loan. There is another loan offer from another lender available for 10 ETH at an interest rate of 50%. Your loan will be automatically refinanced with this new loan offer.