24 Hour Loans glossary of financial terms

Breach of Contract

If you enter into a formal contract with another individual or company then both parties are legally required to uphold the terms of the contract as they are set out. If you do not uphold these terms then you will be held to be in breach of contract ? i.e. you will have broken the terms of the agreement.

This can result in specific legal action or the invalidation of the contract and it can also lead to other problems. For example, if you take out a mortgage loan with a lender then you will, as part of your contract with them, commit to making regular repayments to pay off the money you have borrowed. If you do not do this then you will be in breach of contract and your lender can take legal steps as laid out in the original contract. So, they could, for example, have your property repossessed to recover their money.