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Potential Default

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Potential Default
A condition where a default may occur in time.

Potential Default
A situation that may cause a default on a loan. Alternatively, potential default may refer to a person, especially a loan applicant, who is in such a situation. An obvious example of potential default is a situation in which a borrower loses his/her job. Lenders attempt to identify potential defaults before they make a loan.


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Lenders now realize that many factors that contribute to a potential default.
The new credit score formula, which is used in approximately 75% of lending decisions, is supposed to help lenders minimize their risk by predicting potential defaults better than the old system.
The potential default represents one of the biggest defaults to hit the GCC region since the onslaught of the financial crisis.
 
 
 
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