Sovereign defaults on debts, both to local and foreign creditors, are not common but have a big impact. A model was created to see how governments decide when to default based on who holds the debt and the benefits of having debt. The model, using Eurozone data, shows that defaults are rare but happen when debt levels and interest rates rise. Most of the time, debt is sold at low-risk prices, but governments not sticking to their promises can lead to much lower sustainable debt levels.