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# GLOSSARY

Finance Dictionary : Default

Default

KEYTAKEAWAYS

Learn about Default, a financial term denoting the failure to meet loan or debt obligations, and its potential consequences, including legal actions and credit score impact.


CONTENT

DEFINITION

Default is a financial term that signifies the failure of an individual or entity to meet their contractual commitments related to loans or other debt obligations. This failure to pay can manifest in various forms, including missing scheduled loan payments, neglecting to settle outstanding debts, or breaching the agreed-upon terms and conditions. Default is often a consequence of financial hardship, insolvency, or inability to honor the financial agreement’s requirements.

 

Defaults can lead to various consequences, including penalties, interest accrual, legal actions, and damage to the debtor’s credit score. Lenders or creditors may employ debt collection measures to recover the outstanding amount.

 

Understanding the implications of default is essential for responsible financial management and contract adherence, as it can significantly impact an individual’s or entity’s financial standing and legal obligations.

 

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We strive for accuracy in our content, but occasional errors may occur. Importantly, our information should not be seen as licensed financial advice or a substitute for consultation with certified professionals. CoinRank does not endorse specific financial products or strategies.


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