Default Notice - Distinction From Insolvency and Bankruptcy

Distinction From Insolvency and Bankruptcy

The term default should be distinguished from the terms insolvency and bankruptcy.

  • "Default" essentially means a debtor has not paid a debt which he or she is required to have paid.
  • "Insolvency" is a legal term meaning that a debtor is unable to pay his or her debts.
  • "Bankruptcy" is a legal finding that imposes court supervision over the financial affairs of those who are insolvent or in default.

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