Soft Credit Event

Definition

Soft Credit Event. A soft default. In the context of Credit Derivative events, this is defined as a Credit Event that is repairable.

Context

Soft and Hard defaults are defined by whether or not the corresponding event is repairable. Typically defined by the crossing of some threshold in some measurement. If you don't repair, this becomes a "failure to repair" credit event. The "failure to repair" (Failure To Pay) triggers either a hard default or there is a whole lot of possible terms about the extension of the grace period. Grace period extension applicability would in principle apply to the soft credit event. The hard credit event (e.g. Failure to Repair) is after such a period, if it exists, has passed.

Disclaimer

This entry annotates a FIBO Ontology Class. FIBO is a trademark and the FIBO Ontology is copyright of the EDM Council, released under the MIT Open Source License. There is no guarantee that the content of this page will remain aligned with, or correctly interprets, the concepts covered by the FIBO ontology.