> For the complete documentation index, see [llms.txt](https://docs.amply.finance/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.amply.finance/health-factor-and-loan-to-value-ratio-ltv.md).

# Health Factor and Loan-to-Value Ratio (LTV)

There are 3 types of LTV ratios on Amply:

## Max LTV

Max LTV represents the maximum amount you can borrow against your collateral. For example, if vETH has a Max LTV of 80% on Amply, then you can borrow up to $0.80 for every $1 of vETH deposited as collateral. 

## Liquidation threshold

Liquidation threshold is the LTV at which your position becomes eligible for liquidation. For example, if vUSD’s liquidation threshold is 82%, this means that if your debt value (in USD) becomes worth 82% of your vUSD collateral, then your position will be flagged for liquidation. 

Liquidation threshold is higher than max LTV to give users a buffer against getting immediately liquidated. For example, if max LTV and liquidation threshold of vUSD is 80% and 82% respectively, it means that you can borrow up to $80 for every $100 of vUSD deposited. However, should your debt increase to $82 (debt value becomes 82% of the collateral), your debt position will then be flagged for liquidation. 

## Health Factor

The Health Factor is used to represent the healthy status of your overall borrow positions. A Health Factor (HF) below 1 means that your debt is eligible for liquidation. Your borrowings are viable as long as you maintain HF above 1, however we highly recommend you keep it above 3 to account for potential market volatility. <br>

***HF = SUM\[(collateral in USD \* liquidation threshold)] / total debt in USD***

Mitigating Liquidation Risk:

**Monitor LTV**: Regularly check your Health Factor  to ensure it stays above 1 (the point of liquidation 1).

**Maintain Collateral Buffer**: Consider depositing more collateral than the minimum required amount to create a buffer zone against price fluctuations.

**Repay Borrowings**: Repaying part of your loan can help improve your Health Factor and LTV ratio.