How to take out a Zero-Collateral Loan

Once you have built a ZScore and accrued some Credit Tokens [CTs], you’ll be able to obtain a Zero-Collateral Loan [ZCL] with Zeru. Refer to the previous sections for more information on ZScore and CTs.

Follow this simple guide to find out how to get your first ZCL.

Connect wallet: Open the Zeru app and connect a supported wallet such as MetaMask, Ledger, or Trezor.

Navigate to Markets: In the Zeru app, go to the markets page.

Check ZScore & CT balance: Your ZScore and the number of credit tokens you hold will be displayed on the markets page, which will determine your eligibility for a ZCL.

Select the asset to borrow: Zeru supports borrowing various assets, including stablecoins, ETH, and other ERC-20 tokens. Choose the asset you need and specify the amount you want to borrow.

Review & confirm: Check the loan terms including the interest rate and confirm the transaction in your wallet. This will initiate the loan process, and the borrowed assets will be sent to your wallet.

Congratulations! You have successfully taken a Zero Collateral Loan!

There are three important things to consider now that you’ve successfully taken out your first on-chain Zero-Collateral Loan:

Use within Zeru: Within the Zeru ecosystem, there are multiple ways to put your loan funds to work, such as by opening leveraged long or short positions, providing liquidity, or even restaking.

Options to withdraw: If you prefer, the loaned funds can be withdrawn from the Zeru ecosystem entirely and used for whatever purpose you choose.

Don’t default: Make sure you repay your loan on time or penalties will be applied, such as a reduced ZScore and CT balance.

Repaying a ZCL is straightforward

Connect wallet: Open the Zeru app and connect the wallet that received the ZCL funds.

Navigate to repayments: In the Zeru app, find the "Dashboard" then find the "Borrowed Assets" section.

Select the loan: Choose the loan you want to repay from your list of outstanding loans.

Specify amount: Enter the amount you want to repay, either full or partial.

Review & confirm: Review the repayment details and confirm the transaction in your wallet.