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DeFi Lending Protocol

How to Borrow on Aave — DeFi Loans Explained

Borrow any supported asset against your collateral on Aave — no credit check, no KYC, no approval needed. Here is how to do it safely.

Open Aave App Explore Protocol
aave.protocol Live
Total TVL$14.5B
Cumul. Deposits$71T+
Networks12+
Security Audits15+
AAVE Token16M max supply
Fee Share100% to stakers
Current VersionAave v4 (2026)
Flash Loans0.09% fee
About

How to Borrow on Aave

Borrowing on Aave is a powerful DeFi tool — access liquidity without selling your assets. Supply ETH as collateral and borrow USDC for expenses. Supply WBTC and borrow ETH to take on risk. All without a bank, credit check, or identity verification. The critical factor is understanding and managing your Health Factor to avoid liquidation.

// protocol.stats
Protocol TypeNon-Custodial Lending
TVL$14.5B
Cumul. Volume$71T+
Networks12+
Supported Assets30+
Stablecoin APY3-8% variable
AAVE Staking100% fee share
Flash Loan Fee0.09%
Versionv4 (2026)
GovernanceAAVE DAO
Features

Why Use Aave?

The most battle-tested DeFi lending protocol — supply, borrow, flash loans, GHO, and now 100% fee sharing for AAVE stakers.

[01]
⚖️
Overcollateralized
Must supply more value than you borrow. ETH: 80% LTV — borrow $80 per $100 supplied.
[02]
📊
Health Factor
Your liquidation buffer. Keep it above 1.5 minimum, 2.0 recommended.
[03]
🔄
Variable Rate
Borrow rate adjusts with market demand — typically 2-10% for stablecoins.
[04]
💎
No Repayment Schedule
Borrow indefinitely as long as Health Factor stays above 1.0. No monthly payments.
[05]
⚡
Instant
Borrowed assets arrive in your wallet in the same transaction. No waiting for approval.
[06]
⚠️
Liquidation Risk
If Health Factor drops below 1.0, up to 50% of your collateral is liquidated by bots.
Guide

How to Use How to Borrow on Aave

Step-by-step from wallet connection to earning yield and staking AAVE.

01

Supply Collateral First

You must supply an asset before borrowing. ETH, WBTC, USDC are common collateral assets. Supply at least 2x what you intend to borrow.

02

Navigate to Borrow

On the Aave dashboard, click the "Borrow" tab. You will see your available borrow power based on your supplied collateral.

03

Choose Borrow Amount Carefully

Aim for a Health Factor of 2.0+ after borrowing. The dashboard shows your projected Health Factor before you confirm.

04

Confirm the Borrow Transaction

One transaction — the borrowed asset arrives in your wallet immediately. Set up a price alert for your collateral right now.

05

Monitor Actively

During volatile markets, check your Health Factor daily. Set price alerts at your liquidation price. Repay or add collateral if it approaches 1.2.

Start Earning on Aave Today

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FAQ

Frequently Asked Questions

Everything about How to Borrow on Aave.

What can I use as collateral on Aave?
+
Aave supports dozens of collateral assets including ETH, wstETH, WBTC, USDC, USDT, DAI, LINK, UNI, and many more. Each has a specific LTV ratio and liquidation threshold. Check app.aave.com for the current collateral list.
What happens when Aave liquidates my position?
+
When Health Factor drops below 1.0, liquidators can repay up to 50% of your debt and receive a discount on your collateral (usually 5-10% bonus). This happens automatically — you keep the remaining collateral and cleared debt portion.
What is a good health factor on Aave?
+
Above 2.0 is conservative and recommended. Between 1.5-2.0 is moderate risk. Below 1.5 is high risk in volatile markets. Below 1.0 triggers liquidation. Start conservative and only lower if you actively monitor positions.
Can I borrow stablecoins against ETH on Aave?
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Yes — this is one of the most common Aave use cases. Supply ETH, borrow USDC or USDT. You maintain your ETH price exposure while accessing stablecoin liquidity. Useful for expenses without selling ETH.
How do I repay a loan on Aave?
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On the Aave dashboard, find your borrow position, click "Repay," enter the amount (you can repay partially or in full), and confirm. Partial repayments improve your Health Factor proportionally.
Reviews

What Users Say

ETH Hodler Borrower
★★★★★

"Supply ETH, borrow USDC for living expenses, never sell my ETH. This is the strategy Aave was made for. Health Factor management takes practice but becomes second nature."

Leverage Trader
★★★★☆

"Using Aave for leverage loops — supply ETH, borrow USDC, buy more ETH, supply, repeat. Amplifies gains AND losses. Not beginner territory but very capital efficient."

Near-Liquidation Survivor
★★★★★

"Was at 1.15 Health Factor during a flash crash. The explanation of what to watch would have helped me earlier. Always keep buffer above 1.5 — lesson learned."

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