What does "default" refer to under Regulation Z?

The term "default" under Regulation Z refers specifically to a situation in which a borrower fails to meet the obligations of a loan agreement. This can include scenarios such as failing to make timely payments, not adhering to the terms of the loan, or otherwise violating the conditions outlined in the loan contract.

In the context of Regulation Z, understanding the definition of default is crucial, as it can trigger various legal and financial consequences for the borrower, including late fees, acceleration of the loan, or foreclosure procedures in the case of secured loans.

The correct understanding of default emphasizes the importance of borrowers being aware of their responsibilities and the risks involved in borrowing. This awareness is integral to ensuring that borrowers can manage their loans effectively and maintain compliance with the terms set forth by lenders.