Technical Default Occurs Only When the Borrower Fails to Make

question 42

True/False

Technical default occurs only when the borrower fails to make interest and principal payments when due.

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Definitions:

Security

A financial instrument representing an ownership position in a publicly-traded corporation (stock), a creditor relationship with a government or a corporation (bond), or rights to ownership as represented by an option.

Intrastate Exemption

Refers to exceptions within state regulations that allow certain activities to occur without needing to comply with broader federal laws or regulations.

SEC

The Securities and Exchange Commission, a U.S. federal agency responsible for enforcing federal securities laws, regulating the securities industry, and overseeing the nation's stock and options exchanges.

1934 Act

The Securities Exchange Act of 1934, which governs the trading of securities, such as stocks and bonds, in the U.S.