# Borrowing

Borrowers are able to use [supported collateral](https://betafinance.gitbook.io/betafinance/risk-framework/supported-collaterals) to initiate borrow positions on Beta Finance. When initiating a borrow position, the loan-to-value (LTV) ratio must be below the safety thresholds defined in the [risk parameters](https://betafinance.gitbook.io/betafinance/risk-framework/risk-parameters) for the asset tier of the borrowed token.&#x20;

$$
LTV = min\Bigg(1, \frac{Debt\ Share\ Value \times price\_{token}}{Collateral\ Size \times Collateral\ Factor\times price\_{collateral}}\Bigg)
$$

Requiring the initial position to be below the safety LTV threshold is to protect users from immediate liquidations. The *Debt Share Value*, represents the amount of outstanding tokens the borrower owes, and is the principal borrowed plus accrued interest to be paid. The *Collateral Size* is the amount of collateral that is posted for the position. For example, say you used 1000 $USDC (assuming 1 USD) to initiate a borrow position for an A tier asset. Given the current configuration, you would be able to borrow 0.9 \* 0.65 \* 1000 = 585 USD worth of that asset at most upon initiating a position.&#x20;

To initiate a borrow position on Beta Finance, users follow 3 simple steps:

1. Select the token money market for which you would like to and click the "Borrow" button. Users will also be able to search for specific tokens by contract address.

![](https://lh4.googleusercontent.com/k-YWenr-VLn1JVjCodNVDPgGxcbojehtTEtD54CNnuIduwUkk_8hC0k-Mdj99yv6weLsG9bvDsOEagipddhfM7DL_avpZAORvH0W-5eBfYdEnKOmvEtBdcWaJW3ZH1tp-ByNWeex)

2\. Select the supported collateral you wish to use from the dropdown and enter the desired amount you wish to use for your position. In addition to metrics, the dApp provides convenient buttons that populate fields based on percentages of your current collateral holdings for collateral amount, and percentage of collateral for borrow amount.&#x20;

![](https://lh4.googleusercontent.com/77jI_2HtPMKkEFhGTTMD0hI5T-vnmac9OkxjmX-waCjN37-XKUBXJVDJsSxsUctkj7cDgDorAtW5zwfWYI2uenjSMfHd0x5d8wYbwZhqfGHgGOh8Kzb9hehaujfN4lrnkO1nxR-F)

3\. Click the Borrow button to initiate the position.
