DEFINITION of 'Notice Of Default'
A public notice filed with a court stating that a mortgage borrower is behind in payments. This is one of the first steps toward foreclosure, and if the borrower does not pay, the next step is for the lender to file a notice of sale for the property. However, if the borrower catches up on his or her payments, the foreclosure process can be halted.
BREAKING DOWN 'Notice Of Default'
Lenders have different procedures and timeframes for filing the notice of default. Some are more forgiving and more willing to work with borrowers and may take longer to file the notice, while other lenders will file the notice as soon as they may legally do so. Having a notice of default filed against you can go on your credit report and adversely impact your credit score, making it difficult to refinance your mortgage and to obtain other types of credit.