> ## Documentation Index
> Fetch the complete documentation index at: https://autoloans.liquidity.io/llms.txt
> Use this file to discover all available pages before exploring further.

# Default Loan

This endpoint marks a loan as defaulted due to non-payment. It is typically triggered when the borrower fails to meet repayment obligations within the allowed grace period. Marking a loan as defaulted may initiate downstream processes such as collateral liquidation, recovery actions, or reporting.

**What it does:**

* Updates the loan status to "defaulted"
* Signals the platform to begin recovery or liquidation processes
* Records the default event immutably on-chain

**When to use it:**

* After the borrower misses scheduled repayments beyond the contractual grace period
* As part of automated delinquency handling logic
* Before initiating collateral enforcement or legal action

## Request Body

The request body must include the unique identifier of the loan being marked as defaulted:

```json theme={null}
{
  "loanId": "0x5a0c0663a48e3abf16c7f0ee632b57da833e44e02a290fc0920ea2858da31f73"
}
```

## Response

* Returns a confirmation of success with the blockchain transaction hash:

```json theme={null}
{
  "transactionHash": "0x5a0c0663a48e3abf16c7f0ee632b57da833e44e02a290fc0920ea2858da31f73"
}
```