strategic default

Definition of "strategic default"
  1. A deliberate choice to halt loan repayments by a borrower, usually when their property's mortgage exceeds its equity, despite being financially capable of continuing payments
How to use "strategic default" in a sentence
  1. Following a major drop in property values, many homeowners considered strategic default as an option.
  2. Due to unanticipated market trends, the corporation considered a strategic default on their commercial building loans.
  3. Due to declining home equity, the family weighed the consequences of a strategic default.

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