- The owner of an NFT may list it at a given price, down payment amount, interest rate per period, minimum principal per period (which determines the number of pay periods) and pay period duration by signing a properly formed offer struct and supplying it to the NiftyApes API. An owner can also provide a nftId of ~uint256(0) and a collectionOfferLimit value as a way to make a collection financing offer and support mint financing.
- When a buyer executes a sale by supplying the signed financing offer to the
buyWithFinancing()function the NFT is entered into escrow in the NiftyApes Seller Financing contract and a loan is initiated.
- During the loan a buyer can utilize their purchased NFT on an platform, protocol, or service supported by delegate.cash.
- At any time during the loan or soft grace period, a buyer can accept a valid Seaport bid order for the NFT using the
instantSell()function so long as the proceeds of the sale cover the remaining principal of the loan plus any relevant interest. This action will pay any remaining principal and interest due on the loan to the seller, transfer the remaining value to the buyer, and transfer the underlying NFT to the new buyer.
- In addition, both buyer and seller are minted an NFT loan ticket that represents ownership of their side of the loan and which they can transfer or sell to any other address. This allows another actor to assume the debt obligation or stream of revenue of the loan.
- A buyer can repay the loan in installments over time, or in full at any time, using the
makePayment()function. Upon full repayment the buyer will receive the purchased NFT to their EOA or contract address and both buyer and seller loan tickets are burned.
- If a buyer defaults (failing to make a payment before the end of a pay period), the seller can call the
seizeAsset()function, thus keeping any payments made so far and reclaiming the NFT to keep or resell. Upon asset seizure both buyer and seller loan tickets are burned.
- The system affords buyers the ability to make a late payment during a soft grace period that is one additional pay period in duration, so long as the seller has not already seized the NFT. This allows the buyer and seller the opportunity to communicate and negotiate a late payment without an automatic loss of investment by the buyer.
Updated 5 months ago