Liquidation Risks

Borrowers who are behind on their monthly repayments risk having their NFT liquidated by other users of the Teller protocol, and have their down payment forfeited. When borrowers fail to uphold their end of purchase agreement, their loan is liquidated, and the escrowed NFT is sent to the Lender.

Additionally, the borrower has a deliquient mark recorded on their wallet which would impact their ability to avail services in the future.

A liquidator can close out any loans that have been defauted by the borrowers due to nonpayment in two steps:

1) Liquidate the loan on TellerV2

Ape Now leverages the Teller protocol (DeFi primitive for launching lending markets), to faciliate the loan process between lenders and borrowers on the dApp. Liquidators can close out delinquent loans by calling the following method on the TellerV2 contract:

/**
 * @notice Function for users to liquidate a defaulted loan.
 * @param _bidId The id of the loan to make the payment towards.
 */
function liquidateLoanFull(uint256 _bidId)

2) Claim the NFT from BNPLMarket

Once the loan has been liquidated, the escrowed NFT can be claimed from Ape Now's BNPLMarket contract by calling claimNFTFromDefaultedLoan:

/**
 * @notice Withdraw the NFT from this contract to the lender when loan is defaulted.
 * @param bidId The bidId for the loan from the TellerV2 protocol.
 */
function claimNFTFromDefaultedLoan(uint256 bidId)