What is the term for the period during which a party can fail to perform contractual obligations without being considered in default?

The term for the period during which a party can fail to perform contractual obligations without being considered in default is the "Grace Period." This concept is commonly found in various types of contracts, including loans and leases. A grace period allows the borrower or tenant additional time to fulfill their obligations without facing penalties, such as late fees, or repercussions like being considered in default of the contract.

During a grace period, the lender or lessor acknowledges that there may be legitimate reasons for the delay in performance and chooses to exercise leniency. This can help avoid potential negative consequences for the party who may be temporarily unable to meet their obligations, providing them with a chance to catch up without damaging their contractual standing.

The other terms listed refer to different concepts: the default period implies that a party has already been considered in default, the cure period typically refers to a specified timeframe allowed for rectifying a default, and forbearance refers to the action of a lender agreeing to temporarily refrain from exercising their rights due to non-performance.