In China, banks, from 2004 according to a ruling by the People’s Supreme Court, can only repossess properties but not sell them[1] in contrast to Article of the Guaranty Law which applied from 1996.[2]
In India, the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 makes it possible to foreclose mortgages without approaching a court.[3] Previously, the process took more than 10 years. [4]
Higher loan to value loans are usually funded through insurance [5] Coverage is usually 20-30% of the loan amount.
There is also asymmetric information in the sense that the borrower knows more about his default risk than the lender.
Macro-economic stability, removal of public housing subsidies , titling and registration systems, credit bureaus, enforcement efficiency, government commitment not competition.[6]
[1] Ben- Shahar et al (Ed) Mortgage Markets Worldwide 18
[2] Article 53 Guaranty Law
[3] Article 53 Guaranty Law
[4] Article 53 Guaranty Law
[5] Ben- Shahar et al (Ed) Mortgage Markets Worldwide 107 – with respect to the Israeli system.
[6] Ben- Shahar et al (Ed) Mortgage Markets Worldwide 271-275