> For the complete documentation index, see [llms.txt](https://docs.fira.money/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.fira.money/developers/features/fixed-rate-lending.md).

# Fixed-Rate Lending

Fira enables fixed-rate borrowing through a lending market where BT serves as the loan token, giving borrowers predictable costs.

## Overview

Fira's fixed-rate lending allows borrowers to post collateral and borrow at a known, fixed rate. The mechanism works by using **Bond Token (BT)** as the loan token in a dedicated lending market. Since BT is redeemable for a known value at maturity, the borrowing cost is determined by the BT discount at the time of borrowing.

{% hint style="info" %}
The fixed-rate lending market has **no interest rate model** (`IRM = address(0)`). The rate is implicit in the BT discount — the difference between the BT price at borrow time and its face value at maturity is the borrower's fixed cost.
{% endhint %}

## How it works

### Borrowing

The router's `supplyAndBorrowSingleToken` function handles the full flow in a single transaction:

1. **Supply collateral** — Collateral tokens (e.g., Pendle PT tokens) are deposited into the lending market
2. **Borrow BT** — BT is borrowed from the lending market (supplied by the LiquidityInjector)
3. **Swap BT → FW** — BT is swapped to FW via the Fira Market AMM
4. **Redeem FW → USDC** — FW is redeemed for the desired output token

The borrower receives USDC (or another token) and holds a fixed-rate debt position denominated in BT.

### Repaying

**Pre-expiry:** Input token → FW (mint) → BT (AMM swap) → repay lending market.

**Post-expiry:** Input token → FW (mint) → BT+CT (mint via CT contract) → repay with BT. CT is minted but has zero economic value post-expiry.

### Collateral types

Fixed-rate markets currently support Pendle Principal Tokens (PT) as collateral:

* **PT-USDe** (Ethena USDe, May 7 2026 expiry)
* **PT-sUSDe** (Ethena sUSDe, May 7 2026 expiry)
* **PT-USDG** (Paxos USDG, May 27 2026 expiry)

### Liquidation

Positions that fall below the liquidation LTV (`LLTV`) can be liquidated. The liquidator repays part of the debt and receives collateral plus a liquidation incentive.

## Key features

* **Predictable costs** — Fixed rate determined at borrow time
* **Single-transaction flow** — Collateral supply, BT borrow, swap, and redemption in one call
* **Whitelist-gated supply** — Only the LiquidityInjector can supply BT to fixed-rate markets
* **Maturity grace period** — 24-hour grace period after BT expiry before liquidations are enforced

## Related pages

* [Borrow at Fixed Rate (User Flow)](/developers/user-flows/borrow-fixed-rate.md)
* [Repay Fixed-Rate Debt (User Flow)](/developers/user-flows/repay-fixed-rate.md)
* [Liquidity Injector](/developers/features/liquidity-injector.md)
* [ActionBorrow](/developers/protocol-contracts/router/action-borrow.md)


---

# Agent Instructions
This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com.

## Querying This Documentation
If you need additional information that is not directly available in this page, you can query the documentation by asking a question.

Perform an HTTP GET request on the following URL with the `ask` and `goal` query parameters:

```
GET https://docs.fira.money/developers/features/fixed-rate-lending.md?ask=<question>&goal=<user_goal>
```

`ask` is the immediate question: it should be specific, self-contained, and written in natural language.
`goal` is what the user is ultimately trying to achieve, the reason they need the answer. Sharing it helps GitBook give you a better, more relevant answer. A goal is most helpful when it describes the outcome the user wants rather than restating the question. For example, with `ask=how do I create an API token`, a goal like `automate deployments from our CI pipeline` lets GitBook tailor the answer to that use case.

The response will contain a direct answer to the question and relevant excerpts and sources from the documentation.

Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.