The country to which most defaulting borrowers in Real Estate Finance
are likely to flee to?

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Clarification of Question by buzzlightyear-ga on 07 Dec 2003 17:23 PST

The defaulting borrowers came from the United States.  They are
mortgagors who default on their mortgage loan payments to the
mortgagee.

Defaulting on a mortgage isn't a crime in the US. The person in
default forfeits the property that was mortgaged. It's a civil action,
with no penalty other than the loss of the property.

If someone flees the country, it must be for some other reason.

hlabadie-ga

If the loan is recourse then the mortgagee can go after the
mortgagor's(defaulting borrower) assets.  The mortgagor flees with his
assets to another country to evade the reach of the mortgagee.

This event is relatively rare.

Mortgage Default Risk and Real Estate Prices:
The Use of Index-Based Futures
and Options in Real Estate
http://cowles.econ.yale.edu/P/cd/d10b/d1098.pdf

"The put option on real estate arises from the option the mortgagor
has to default altogether on the mortgage.In non-recourse states, like
California and Texas, this option is guaranteed by law. In other
states, the mortgagor does not technically have this option, but in
practice lawsuits seeking deficiency judgments against non-real estate
assets of defaulting mortgagors are few in number."

In effect, there are so few instances that it is probably not feasible
to plot a trend.

hlabadie-ga

Okay, if a trend cannot be plotted for defaulting mortgagors fleeing
the country, can a trend be plotted for debtors in general?  What
country do most American debtors seek refuge in to avoid paying their
debts?  I would assume this would be a country that has no extradition
treaty with the United States.

Dear Buzzlightyear, 

No official or otherwise statistics exists regarding your question,
only information gathered here through media-research.

This information, regarding debtors, discusses people with heavy IRS
debts, and/or other curroption allegations, that flee the country.

It implies, in these cases, that the most popular destinations seem to
be Brazil and Switzerland.