What is a failure to pay a loan according to the agreed upon terms?

A failure to pay a loan according to the agreed-upon terms is known as defaulting on the loan. This occurs when the borrower does not make the scheduled payments, whether it's failing to pay the full amount, missing payments entirely, or not adhering to the payment timeline. Default can lead to penalties, increased interest rates, and potential legal actions by the lender, including foreclosure on secured assets. It negatively impacts the borrower's credit score and financial standing.