# The Blend Lending Process A Lender can make loan offer bids against an NFT collection collateral base by suggesting both a principal amount and interest rate. Borrowers can use those loans in one of two ways: to take a loan on an NFT they already hold or to “buy now, pay later” (i.e., buy a NFT on credit). Lenders receive Blur points, which are future claims to $BLUR airdrops, while bids remain open. Once a Borrower agrees to take out a loan, their NFT collateral goes into an escrow wallet maintained by Blur and the borrower receives ETH from the Lender from a wallet pre-funded by the Lender on Blur. When the Borrower pays back the loan, the NFT collateral is returned to the borrower’s wallet and the principal and accrued interest goes to the lender. Once originated, a loan can be called by the lender at any time. However, there is a 250 Blur point penalty for calling a loan within 24 hours of origination. Once called, a loan goes into auction for 24 hours at a steadily increasing APY. If no lenders claim the loan, then the borrower has 6 hours to repay. If the loan is not repaid, the lender can foreclose on the loan and claim the underlying NFT. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.coolwater.xyz/blender-strategy/the-blend-lending-process.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.