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Credit & default

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Much of the financials sector revolves around credit and default. Credit is the extension of capital and money to those with it to those seeking to use it.


A default is defined when a borrower is in violation of his/her loan agreement. Most often this is in the form of a late or non-payment on the debt. But a default can also occur when the borrower deviates from the terms of the contract which materially impact the likelihood of full and timely repayment of the debt. For example, a borrower may be obliged by its creditor to retain a certain liquidity level as part of its debt agreement. If the borrower is in violation the lender may, depending on how the contract is written, be able to call-in the debt. In such cases, where there is no actual late or non-payment or a material change to the original terms of the debt (because of a negative change in the borrower’s position), it is viewed as a credit event rather than an outright default.

Specialty finance

Specialty finance refers to consumer and business financing, sometimes through non-traditional sources,  where often the market has weaker or more opaque credit conditions. Typical asset classes include automobile loans, credit card offerings, equipment finance, payday loans, education loans, etc.

Asset-backed lending

Asset-backed lending (ABS)

Unsecured lending

Unsecured lending refers to credit or cash being extended without the debt being secured by chattel

Consumer, business and product credit scores/ratings




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