The settlement days convention for US Corporate Bonds is T+3. So there are 2 dates:
t_value
t_settle ( This is 3 business days after t_value )
Let's say you buy a corporate bond on t_value and the company defaults on day T+2, what happens in general? Same as normal?
Also, what about things like accrued interest? Pay the full AI amount from (CpnStartAccrualDate, T+3)?
Thanks