Understanding defaults
What is a default?
In lending, a ‘default’ means the borrower hasn’t met the contractual payment terms of their loan – but it doesn’t automatically mean a loss.
At FOLK2FOLK a loan is flagged as in default if a monthly interest payment is 14 days overdue. This is earlier than the 180-day regulatory trigger because our experience shows early action helps improve recovery prospects.
What happens
What we do when a loan defaults
We don’t believe in a one-size-fits-all approach to enforcement. Sometimes, working collaboratively with the borrower leads to a faster or fuller recovery; other times, formal enforcement is required.
Our experienced legal partners help guide decisions based on what’s in the best interests of investors.
Resources
Explore related information
When it comes to defaults and recoveries, transparency matters. Explore the resources below to understand how we manage defaults, mitigate risk, and work to recover investor funds.
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