In mortgage terms, what does "default" refer to?

In mortgage terms, "default" specifically refers to when a borrower fails to meet the obligations outlined in the mortgage agreement. This typically means that the borrower has not made the required payments on time or has violated other terms specified in the loan documents, such as maintaining insurance or paying property taxes. When default occurs, it can lead to serious consequences for the borrower, including foreclosure, where the lender may take possession of the property to recover the outstanding debt.

Refinancing a mortgage involves changing the terms of the existing mortgage, often to achieve a better interest rate or different payment terms, and is not related to default. Selling the property to settle the loan indicates a specific action taken to address debt but does not define default itself. A temporary suspension of loan payments could be a relief measure, but it does not equate to a default; instead, it might be a strategy to avoid reaching default status. Understanding this distinction is crucial for comprehending borrower responsibilities and the potential repercussions of failing to uphold them.