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When you borrow money, you agree to repay it within a specified time frame and according to the agreed terms. If you fail to repay the loan on time or as agreed, it is considered a default. Defaulting on a loan can have significant consequences, including damage to your credit score, facing legal action, and the pain and embarrassment of debt collection. All these consequences may have long term effects by making it more difficult to obtain credit in the future.

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