Loan Defaults

A loan default occurs when a borrower fails to meet the repayment terms set by the lender, typically by missing payments for an extended period. This can happen due to financial hardship, unexpected expenses, or poor money management. Defaulting on a loan can lead to serious consequences, such as damage to the borrower’s credit score, increased interest rates, and legal action from the lender to recover the owed money. In extreme cases, it can result in the loss of assets, like cars or homes, if they were used as collateral for the loan.