Banking / Finance Law

Loan Default

The failure of a borrower to repay a loan according to the agreed schedule, which can trigger recovery action by the lender.

Following a default, lenders typically issue reminders and a formal demand notice before initiating stronger recovery measures — including, for secured loans, action under securitisation law, or a recovery suit for unsecured loans.

A defaulting borrower retains the right to be treated fairly during the recovery process, including protection against harassment by unauthorised recovery agents.

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