Default Rate definition: Copy, customize, and use instantly
Introduction
The term "Default Rate" refers to the interest rate applied to an overdue payment or a financial obligation in default. It is commonly used in loan agreements, credit contracts, and bond issuances to specify the increased rate imposed when a borrower fails to make timely payments. A well-defined “Default Rate” ensures clarity in financial agreements, setting the terms under which higher interest applies due to default.
Below are various definitions of “ Default Rate” tailored to different contexts. Copy the one that fits your needs, customize it, and use it in your contract.
Definition of "Default Rate" as an increased interest rate
This definition ties "Default Rate" to a higher rate applied upon default.
"Default Rate" means the increased rate of interest applicable to outstanding obligations when an event of default occurs under the agreement.
Definition of "Default Rate" as a penalty rate
This definition connects "Default Rate" to punitive financial consequences.
"Default Rate" refers to the penalty interest rate charged on overdue payments or delinquent accounts.
Definition of "Default Rate" as a loan default provision
This definition links "Default Rate" to credit agreements.
"Default Rate" means the rate of interest that applies to a loan when the borrower fails to meet payment obligations as defined in the loan agreement.
Definition of "Default Rate" as a contractual default mechanism
This definition applies "Default Rate" to contract enforcement.
"Default Rate" refers to the rate of interest applied to outstanding amounts when a borrower fails to comply with the terms of an agreement.
Definition of "Default Rate" as an interest adjustment clause
This definition ties "Default Rate" to loan modifications.
"Default Rate" means the adjusted interest rate imposed on a borrower following a default under the financing terms.
Definition of "Default Rate" as a creditor protection measure
This definition connects "Default Rate" to lender risk mitigation.
"Default Rate" refers to the rate of interest applied to protect the lender against increased risk when a borrower defaults.
Definition of "Default Rate" as an overdue payment consequence
This definition links "Default Rate" to past-due amounts.
"Default Rate" means the interest rate that applies when a borrower fails to make payments by the due date specified in the agreement.
Definition of "Default Rate" as a credit risk management tool
This definition applies "Default Rate" to risk assessment.
"Default Rate" refers to an elevated interest rate charged by lenders to manage the additional risk posed by defaulting borrowers.
Definition of "Default Rate" as a late payment deterrent
This definition ties "Default Rate" to discouraging defaults.
"Default Rate" means the higher interest rate imposed to deter late payments and ensure timely compliance with repayment obligations.
Definition of "Default Rate" as a financial penalty provision
This definition connects "Default Rate" to punitive financial terms.
"Default Rate" refers to the interest rate established as a financial penalty for a borrower’s failure to meet payment obligations.
Definition of "Default Rate" as a revolving credit term
This definition links "Default Rate" to credit lines.
"Default Rate" means the rate of interest applicable to outstanding balances under a revolving credit facility in the event of default.
Definition of "Default Rate" as a loan agreement term
This definition applies "Default Rate" to loan contracts.
"Default Rate" refers to the contractual interest rate increase that takes effect when a borrower defaults on a loan.
Definition of "Default Rate" as a fixed penalty interest
This definition ties "Default Rate" to predetermined penalties.
"Default Rate" means the fixed interest rate applied to unpaid amounts upon a borrower’s default.
Definition of "Default Rate" as a floating interest rate adjustment
This definition connects "Default Rate" to market-based adjustments.
"Default Rate" refers to the higher of a fixed penalty rate or a floating market rate plus a margin applied upon default.
Definition of "Default Rate" as a lender’s remedy
This definition links "Default Rate" to lender protections.
"Default Rate" means the increased interest rate that serves as a remedy for lenders in response to borrower default.
Definition of "Default Rate" as a loan restructuring component
This definition applies "Default Rate" to debt restructuring.
"Default Rate" refers to the revised interest rate applied to outstanding amounts during loan restructuring following default.
Definition of "Default Rate" as a risk-adjusted pricing mechanism
This definition ties "Default Rate" to risk-based pricing.
"Default Rate" means the risk-adjusted interest rate imposed on delinquent accounts based on credit risk factors.
Definition of "Default Rate" as a monetary default consequence
This definition connects "Default Rate" to financial penalties.
"Default Rate" refers to the increased interest rate applicable upon failure to meet monetary obligations under the agreement.
Definition of "Default Rate" as an event-triggered adjustment
This definition links "Default Rate" to specific default events.
"Default Rate" means the rate of interest that applies upon the occurrence of a specified default event under the contract.
Definition of "Default Rate" as a protective measure for creditors
This definition applies "Default Rate" to creditor safeguards.
"Default Rate" refers to the contractual rate adjustment designed to protect creditors against nonpayment risk.
Definition of "Default Rate" as a late payment surcharge
This definition ties "Default Rate" to additional charges.
"Default Rate" means the surcharge interest rate imposed on overdue amounts as per the terms of the agreement.
Definition of "Default Rate" as a corporate debt provision
This definition connects "Default Rate" to business loans.
"Default Rate" refers to the increased rate of interest applicable to corporate debt when the borrower breaches payment terms.
Definition of "Default Rate" as a margin-based penalty rate
This definition links "Default Rate" to adjustable interest margins.
"Default Rate" means the standard interest rate plus an additional penalty margin applied due to default.
Definition of "Default Rate" as a measure of financial distress
This definition applies "Default Rate" to financially distressed borrowers.
"Default Rate" refers to the heightened interest rate applied to loans in default due to financial distress.
Definition of "Default Rate" as a credit card penalty rate
This definition ties "Default Rate" to consumer lending.
"Default Rate" means the penalty annual percentage rate (APR) charged on credit card balances when a cardholder defaults.
Definition of "Default Rate" as a government loan provision
This definition connects "Default Rate" to public financing.
"Default Rate" refers to the interest rate imposed on overdue government-backed loans.
Definition of "Default Rate" as a mortgage delinquency penalty
This definition links "Default Rate" to home loans.
"Default Rate" means the penalty interest rate applied to mortgage payments that are past due.
Definition of "Default Rate" as an automatic loan adjustment
This definition applies "Default Rate" to automatic rate changes.
"Default Rate" refers to the automatic adjustment of interest rates triggered by nonpayment or covenant breach.
Definition of "Default Rate" as an alternative dispute resolution tool
This definition ties "Default Rate" to contract enforcement.
"Default Rate" means the agreed-upon rate applied in disputes to compensate for delayed payments.
Definition of "Default Rate" as a consequence of credit score deterioration
This definition connects "Default Rate" to creditworthiness.
"Default Rate" refers to the higher interest rate imposed due to a borrower’s deteriorating credit score following default.
Definition of "Default Rate" as a bankruptcy-related interest adjustment
This definition links "Default Rate" to insolvency cases.
"Default Rate" means the rate of interest applicable to obligations in bankruptcy proceedings.
Definition of "Default Rate" as a small business loan provision
This definition applies "Default Rate" to commercial lending.
"Default Rate" refers to the increased interest rate applicable to small business loans upon payment default.
Definition of "Default Rate" as a bank-imposed penalty
This definition ties "Default Rate" to lender discretion.
"Default Rate" means the penalty interest rate determined by a financial institution following a borrower’s default.
Definition of "Default Rate" as an investor protection measure
This definition connects "Default Rate" to bondholder rights.
"Default Rate" refers to the increased yield applied to bonds in default.
Definition of "Default Rate" as a lease payment penalty
This definition links "Default Rate" to rental contracts.
"Default Rate" means the interest charged on overdue lease payments per the lease agreement.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.