What happens to the economy when a large number of loans default?

I try to work it into my head, but no luck so far. How it works? If you take out a loan and repay it, the economy gains more money, but what if a large number of people default on their loans? How … student loans or what? Would happen to something like the subprime crisis? Aww shit, the wrong category. Maybe it would have posted in the economy. OTL

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