If you’re behind on your mortgage and looking to dodge creditors, forget the Cayman Islands--Texas is the place to be.
Texas laws are apparently more lenient for debtors looking to shield assets form creditors. “Distressed borrowers can hang on to luxury cars, a primary residence, paychecks, retirement accounts, and even jewelry that creditors might claim elsewhere,” Bloomberg reports.
As a result, a growing number of troubled mortgage holders from housing boom states--like California and Florida--are moving to the “Lone Star State.”
A still-robust job market draws nonresidents trying to get away from houses worth less than what they owe on the mortgage, said Jay Westbrook, a business-law professor at the University of Texas in Austin. These newcomers find employment, buy a home in Texas, and mail lenders the keys to the house they abandoned.
Texas bankruptcy filings involving delinquent out-of- state mortgages increased by at least a third in the past year, said Jan Northrup, a lawyer with Hughes Watters Askanase and a bankruptcy trustee in the U.S. District of Southern Texas. Many involve people who moved from Florida, California, Colorado or Arizona, she said.
``We're especially seeing people who were using their credit cards to pay their mortgages, hoping their houses would sell, who were just digging themselves deeper into a hole,'' Northrup said.
This move is just screaming for a satirical, Texas-cliché-based nickname.
What do you think: Texas two-step? Ten-gallon slip?