Real Estate Term of the Day: Default
DEFAULT – failure to fulfill an obligation or promise, or to perform specified acts (Barron’s Dictionary of Real Estate Terms)
Two common forms of a default in terms of real estate are:
- Default by either buyer or seller of the agreed upon purchase agreement. In the State of Colorado, the Colorado Contact to Buy and Sell Real Estate (residential) will layout the remedies & penalties if either party defaults on the agreement.
- Default by borrower of the agreed upon deed of trust, in which they agree to continue to make their loan payments among other obligations set forth in the deed of trust. The deed of trust will layout the penalties if the borrower defaults.
Note: there are be many other forms of default that can be found in a real estate transaction. The above items represent in my opinion the two most common.
