A Default is a word of Anglo-Saxon origin that literally means or refers to doing something by default or by default, it is also known as “suspension of payments”; The term default is used mostly in Spanish for when, in a financial context, a person cannot pay the installments and interest on a debt on time. That is, a Default occurs when the expiration date of a debt reaches its limit and the person on whom the debt falls does not have with what to pay it or does not want to pay it, it is in this way that it is said that the debtor falls into the cessation of payments or default. It is a procedure that aims to reach an agreement between the debtor and the creditors, under judicial supervision, on how it will be paid. A Default is considered by the lenders an overtime but sentenced, in which the debtor must solve the problem on notice, otherwise what leads to a default without positive results is bankruptcy.
There is also talk of default in the event of a breach of contract by the signatories, if this situation happens, revisions of the guidelines and conditions of the contract are activated in order to analyze the situation and take measures in this regard. A person by not fulfilling the obligations established in a contract obliges the Default before executing the pertinent actions.
However, default is basically the restoration of a system's default settings, when a computer is restored to all its factory settings. They are what the designers recommend and therefore a Default leads to the ideal settings. A Default is made when the system suffers a deconfiguration, either by human error or by the presence of an external agent that impairs stability.
There are different types of default, which among them we can mention: the sovereign default that occurs when sovereign creditors such as the State are not subject to legal sanctions in their own jurisdiction, and therefore may be capable of default without legal consequences. Technical default is the result of not meeting a loan condition, and has nothing to do with non-payment of a scheduled loan. Default debt service occurs when a scheduled payment on a loan is missed, and a borrower's inability to repay a loan will not prevent entering a state of default. And strategic default es cuando un prestatario se niega a propósito para hacer un pago en un préstamo a pesar de su capacidad de hacer los pagos, esto suele ocurrir con un préstamo sin recurso.
