Friday, November 9th, 2012
10

Who Wants to Buy and Forgive Some Cheap Debt? It's the Rolling Jubilee!

"OWS is going to start buying distressed debt (medical bills, student loans, etc.) in order to forgive it. As a test run, we spent $500, which bought $14,000 of distressed debt. We then ERASED THAT DEBT." It's the Rolling Jubilee! There are some tricky issues with this as a program but guess what? TECHNICALLY, it actually works.

10 Comments / Post A Comment

hershmire (#233,671)

Wait, what stops someone from buying his own debt and cancelling it himself?

@hershmire You can haggle with debt collectors. When they buy debt they expect a certain amount of it (if not most) to not get paid back. That's why they get it for so little in the first place. So once you know you're being hounded by an agency and not the original–whattaya call 'em, lendee? whatever–you can haggle. You should be able to knock about 75% off no problem. Because it used to be they bought debt at about 25% and they would be glad just to cover their costs given the high default rates they expect. But it has possibly changed a lot since the days that I knew about this stuff. And this doesn't work for houses, IIRC.

hershmire (#233,671)

@My Number Is My Address Yeah, but I suspect a debt collector wouldn't let the debtor agree to, say, $500 on $13,000 worth of debt. If you contact them and say you want to settle, they'll try to squeeze as much cash out of you as possible. Whereas if the collector has given up on receiving any money, he'll sell it for pennies to another collector.

This might take a third-party…

julebsorry (#5,783)

@My Number Is My Address Be careful when haggling, though – unfortunately, I think the credit companies have caught on to this tactic. At a recent "know your credit report" seminar I sat through, they indicated that it's marked differently on your credit report if the debt is "paid in full" or settled for a lesser amount. Settled for a lesser amount hurts more on your credit score. Not totally fair, I thought, but apparently how they do you these days. They did say this is all based on the debt company's reporting, though – so, you could possibly make it part of your settlement conditions that the creditor report the debt as "paid in full" even if it technically wasn't.

@julebsorry Good tip. Cheeky fuckers.

Todd@twitter (#12,959)

Hedge Funds wannabes are reading this post and figuring out a way to arbitrage this.

julebsorry (#5,783)

@My Number Is My Address Be careful when haggling, though – unfortunately, I think the credit companies have caught on to this tactic. At a recent "know your credit report" seminar I sat through, they indicated that it's marked differently on your credit report if the debt is "paid in full" or settled for a lesser amount. Settled for a lesser amount hurts more on your credit score. Not totally fair, I thought, but apparently how they do you these days. They did say this is all based on the debt company's reporting, though – so, you could possibly make it part of your settlement conditions that the creditor report the debt as "paid in full" even if it technically wasn't.

deepomega (#1,720)

I'm not sure I understand. Only the federal government can help people.

SidAndFinancy (#4,328)

In which bail money becomes bail-out money.

This is satisfying on many levels.

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