Glossary
Failure to repay a loan according to the agreed terms. Default typically occurs after a series of missed payments and triggers serious financial consequences.
In depth
Most lenders consider a loan in default after 90 to 180 days of missed payments, though terms vary. Default leads to significant credit score damage, collection activity, and possible legal action. If you are struggling to repay, contact your lender early — many participating lenders offer hardship options before default occurs.
FAQs
The lender may send the debt to collections, report the default to credit bureaus, and pursue legal action. Your credit score will drop significantly. Contact your lender immediately if you anticipate trouble.
A default remains on your credit report for seven years from the date of the first missed payment. Its impact on your score typically decreases over time.
Related terms
Late Fee
A charge added to your loan balance when a payment is not received by the due date. Late fees vary by lender and are specified in your loan agreement.
Read more →Credit Score
A three-digit number (typically 300–850) that summarizes a borrower's credit history and predicts the likelihood of repaying debt. Higher scores indicate lower risk to lenders.
Read more →Loan Term
The length of time you have to repay a loan, typically expressed in months. Common personal loan terms range from 12 to 60 months.
Read more →Personal Loan
An unsecured installment loan that can be used for almost any purpose. Repaid in fixed monthly payments over a set term.
Read more →One secure request. No hard credit pull. No cost to check.