Aave borrowers can have their borrowing limit reduced to zero without triggering liquidation, cutting off access to additional credit while leaving existing positions intact. A zero borrowing limit prevents a given collateral asset from supporting any new debt, but it does not force the sale of that collateral.
Liquidation on Aave is governed by a separate health-factor threshold independent of the borrowing cap. This means users may lose borrowing capacity on specific assets due to risk parameter changes or governance decisions while still retaining the ability to hold and repay their current positions without facing forced liquidation.
Aave Borrowers Can Lose Credit Access Without Facing Liquidation
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