Which of the following best defines "default" in relation to property loans?

The definition of "default" in the context of property loans is best described as not complying with loan agreement terms. When a borrower fails to meet the obligations specified in their loan agreement—such as missing payments, not maintaining required insurance, or violating any other terms of the loan—it constitutes a default. Defaulting can lead to serious repercussions, including penalties, foreclosure, or legal actions taken by the lender to recover the debt.

In contrast, making timely payments reflects compliance with the loan's terms, securing additional financing may involve using existing equity or credit resources and does not have a direct bearing on default status, and reducing the mortgage principal is generally a positive action that can strengthen the borrower’s position rather than signify default. Therefore, understanding the precise conditions that define default is crucial for borrowers and lenders alike to manage risks effectively.