# Collaterals Collateral refers to assets that a user deposits or locks into a smart contract to secure their loans, acting as a guarantee to cover potential losses in case of default or liquidation. The value of the collateral must be higher than the value of the assets borrowed, ensuring that the lender and Unitus is protected from losses. If a user’s ***Adequacy Ratio*** fell below 1, his collateral can be automatically sold at a discount to repay the lender and maintain the overall health of Unitus. Collateralization ratios and other risk parameters vary between different assets and networks. Please check the '***Risk Parameters***' for the assets of your choice. --- # 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://unitus.gitbook.io/unitus-v2/unitus-v1/borrow/collaterals.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.