I thought a TermMax borrower limit order was basically a free reservation: set the maximum fixed rate I’ll accept and wait.
Turns out it isn’t.
In TermMax’s Morpho design, collateral behind an unmatched borrower order can be moved into Morpho and used to open a floating-rate loan while the fixed order waits. If a lender fills the order, the borrower can move that debt into the TermMax fixed position. If the order is cancelled, the Morpho loan remains until it’s repaid.
So the waiting period has a real price.
Suppose I need $100,000 for 90 days. I can borrow immediately at 7%, or wait ten days for a 6% TermMax order to fill.
Using simple APR math before fees, taking 7% immediately costs about $1,726 over 90 days.
If the waiting loan costs 15% for ten days and the remaining 80 days are fixed at 6%, the total is also about $1,726.
Same cost. Better-looking fixed quote.
If the floating rate during those ten days is 9%, the total falls to roughly $1,562, saving about $164. Now waiting helped.
That changed how I read a borrower limit order. The target rate alone doesn’t tell me whether the decision was good. I also need the floating wait rate, expected fill time, remaining maturity, and transition costs.
The integration removes a funding gap, which is useful. But it doesn’t remove the economics of waiting. It turns the order into a conditional rate switch.
@TermMax #TermMax
Turns out it isn’t.
In TermMax’s Morpho design, collateral behind an unmatched borrower order can be moved into Morpho and used to open a floating-rate loan while the fixed order waits. If a lender fills the order, the borrower can move that debt into the TermMax fixed position. If the order is cancelled, the Morpho loan remains until it’s repaid.
So the waiting period has a real price.
Suppose I need $100,000 for 90 days. I can borrow immediately at 7%, or wait ten days for a 6% TermMax order to fill.
Using simple APR math before fees, taking 7% immediately costs about $1,726 over 90 days.
If the waiting loan costs 15% for ten days and the remaining 80 days are fixed at 6%, the total is also about $1,726.
Same cost. Better-looking fixed quote.
If the floating rate during those ten days is 9%, the total falls to roughly $1,562, saving about $164. Now waiting helped.
That changed how I read a borrower limit order. The target rate alone doesn’t tell me whether the decision was good. I also need the floating wait rate, expected fill time, remaining maturity, and transition costs.
The integration removes a funding gap, which is useful. But it doesn’t remove the economics of waiting. It turns the order into a conditional rate switch.
@TermMax #TermMax
