# Liquidation

### 1. What is a liquidation point?

The liquidation point is that you must control the value of the mortgage assets below the liquidation point to avoid the risk of being liquidated. If your collateral falls below this minimum liquidation point, your collateral may be liquidated and your collateral may be sold to pay off your debt.

### 2. What is a liquidation penalty?

A liquidation penalty is an amount added to your debt after your mortgaged assets have been liquidated.

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