What does the term "default" refer to in the context of property loans?

In the context of property loans, the term "default" specifically refers to failing to meet mortgage payments or comply with other terms of a loan agreement. This can occur when a borrower misses one or more payments, does not adhere to the terms set out in the mortgage contract, or fails to maintain insurance or pay property taxes as required by the lender. Defaulting on a loan can lead to serious consequences, including foreclosure, where the lender takes possession of the property to recover the outstanding debt.

Understanding this definition is crucial for borrowers, as being aware of what constitutes a default can help them avoid potentially damaging situations related to their mortgage. This highlights the importance of adhering to all obligations of the loan agreement to maintain ownership and financial stability.