diff --git a/src/libraries/external/Auctions.sol b/src/libraries/external/Auctions.sol
index cd7cc022b..4b8c0e298 100644
--- a/src/libraries/external/Auctions.sol
+++ b/src/libraries/external/Auctions.sol
@@ -514,7 +514,8 @@ library Auctions {
             result_.poolDebt,
             result_.newLup,
             result_.t0DebtInAuctionChange,
-            result_.settledAuction
+            result_.settledAuction,
+            result_.remainingCollateral
         ) = _takeLoan(
             auctions_,
             buckets_,
@@ -580,7 +581,8 @@ library Auctions {
             result_.poolDebt,
             result_.newLup,
             result_.t0DebtInAuctionChange,
-            result_.settledAuction
+            result_.settledAuction,
+            result_.remainingCollateral
         ) = _takeLoan(
             auctions_,
             buckets_,
@@ -989,6 +991,7 @@ library Auctions {
      *  @return newLup_                 The new LUP of pool (after debt is repaid).
      *  @return t0DebtInAuctionChange_  The overall debt in auction change (remaining borrower debt if auction settled, repaid debt otherwise).
      *  @return settledAuction_         True if auction is settled by the take action.
+     *  @return remainingCollateral_    Borrower collateral remaining after take action. (NFT take: collateral to be rebalanced in case of NFT settlement)
     */
     function _takeLoan(
         AuctionsState storage auctions_,
@@ -1003,7 +1006,8 @@ library Auctions {
         uint256 poolDebt_,
         uint256 newLup_,
         uint256 t0DebtInAuctionChange_,
-        bool settledAuction_
+        bool settledAuction_,
+        uint256 remainingCollateral_
     ) {
 
         TakeLoanLocalVars memory vars;
@@ -1031,7 +1035,7 @@ library Auctions {
             t0DebtInAuctionChange_ = borrower_.t0Debt;
 
             // settle auction and update borrower's collateral with value after settlement
-            borrower_.collateral = _settleAuction(
+            remainingCollateral_ = _settleAuction(
                 auctions_,
                 buckets_,
                 deposits_,
@@ -1039,6 +1043,8 @@ library Auctions {
                 borrower_.collateral,
                 poolState_.poolType
             );
+
+            borrower_.collateral = remainingCollateral_;
         } else {
             // the overall debt in auction change is the amount of partially repaid debt
             t0DebtInAuctionChange_ = t0RepaidDebt_;
diff --git a/tests/forge/ERC721Pool/ERC721PoolLiquidationsTake.t.sol b/tests/forge/ERC721Pool/ERC721PoolLiquidationsTake.t.sol
index 92db05ada..4c611d29e 100644
--- a/tests/forge/ERC721Pool/ERC721PoolLiquidationsTake.t.sol
+++ b/tests/forge/ERC721Pool/ERC721PoolLiquidationsTake.t.sol
@@ -776,6 +776,15 @@ contract ERC721PoolLiquidationsTakeTest is ERC721HelperContract {
             borrowerCollateralization: 1 * 1e18
         });
 
+        // borrower should be able to remove collateral in the pool
+        _repayDebtNoLupCheck({
+            from:             _borrower,
+            borrower:         _borrower,
+            amountToRepay:    0,
+            amountRepaid:     0,
+            collateralToPull: 1
+        });
+
         vm.revertTo(snapshot);
 
         // borrower repays part of debt, but not enough to exit from auction