Paying consumer debts is basically optional in the United States
pluralistic.netSort of. I got into a rough spot after I got out of the military and I ended up defaulting on all my credit card debt. I got kicked out for being gay with no notice and had no savings. What little I had went to moving and finding a new job.
Only AmEx sued me (and we settled). I later sued most of the collection companies with the help of a lawyer and netted about $40K in settlements. Some had called my parents and told them they’d call the police and arrest me that day (they paid). Another called me work repeatedly and told my boss (he didn’t care other than the endless harassment).
It took 7 years for my credit to be clean. I still get calls from scummy bottom of the barrel collectors about debt I paid/settled - even 20 years later. They give up easily though, statute of limitations is long past.
Anyway my point is it’s not optional, you can get sued. And they'll harass you endlessly.
> Another called me work repeatedly and told my boss
Even from a purely self serving perspective, why would they do this? If your boss gets mad that you have bad debt and fires you, then it’s now even less likely that you will be paying off the debt, no?
This may be hard for HN readers to believe given the anti-employer sentiment in many threads here, but...
My friend owns 15+ apartment buildings in "not so desirable" neighborhoods. He deals with a lot of tenants who don't pay rent and eventually he has to evict them.
3 months ago he was evicting someone for not paying rent for 12+ months, and a week before the police were going to help get the tenant out of the apartment, his employer stepped in and paid the landlord his back-rent in full.
The tenant was employed at a local roofing company. Apparently he was a good roofer, and the owner of the company didn't want to see the worker homeless, so he stepped in and paid a year of the guy's back rent. (And here's the twist... after his employer stepped in and settled his back rent, the tenant still refuses to pay rent, and will be evicted again 6-9 months from now)
Maybe debt collectors have had similar luck as the landlord in this story, but that's probably a secondary motivation. Primary motivation for the debt collector is intimidation. Debt collection agencies are ruthless in all ways imaginable.
Landlords that own entire apartment buildings are parasites, so there's not going to be very much sympathy. Most parasite species are mitigated much more directly once detected by a human host.
It can be a mutually beneficial relationship: you want to live somewhere, but with the flexibility to be able to move on relatively short notice with minimal hassle, and without all the work, capital requirements and risk that comes with owning a house or condo. Somebody else owns an apartment building, and is already taking care of maintenance, paperwork etc. A perfect match.
The problem in the current market is that in many places there's far more demand than supply, so there's little pressure on the landlord to actually be a good landlord. If people could actually find other apartments at a similar price point in the area, people would just move out when the landlord doesn't uphold their part of the bargain, and competition would drive prices down to a point where the financial difference between buying and renting is a reasonable fee for the conveniences and flexibility of renting. But that's not the world most American cities live in. Instead tenants are stuck because there are no viable alternatives on the market, and some landlords shamelessly exploit that.
What's your address and how soon can I move in?
DM is okay, if you don't want to post it on the internet.
Why should they welcome you in the house they use to LIVE in? As opposed a house they use to make money out of, without contributing anything to society, like landlords do?
Landlords contribute plenty to society: they provide optionality. Without landlords, folks would be forced to pay or borrow hundreds of thousands of dollars ahead of time to build or purchase homes[0]; they would be forced to incur more severe transaction costs (having to sell) when moving; they would be forced to find the funds to handle maintenance issues; they would be forced to have a significant portion of their net worth tied up in housing. A tenant avoids all of that: he only has to make a relatively small deposit; he can leave relatively quickly and easily; he can rely on someone else to handle maintenance; he doesn’t care if housing prices decrease. Those benefits are not free, of course: they cost money, because they have value.
Indeed, given how many people flat-out couldn’t afford to buy in a world without landlords, landlords prevent homelessness. Just like farmers, distributors and grocers prevent starvation.
There are plenty of live-in landlords that rent rooms to people and live in the same house.
Many renter commenters assume that anyone owning a house automatically owes the society to provide housing to those that don't. Of course such people don't actually like taking care of the house or pretend that depreciation and maintenance don't exist.
You should probably fix that also, no? Unless you want all housing to look like abandoned blocks in Detroit.
I'm kind of tired of this thinly-veiled socialist sentiment.
Then offer a proper argument that supports making profit off of owning property.
i have the power to do so, and i like to do so, so i will do so. what's your argument for stopping me?
My experience with debt collectors is they don’t act rationally and once they’re able to find someone they harass you using any means necessary. The fear of being fired is a good motivator to get people to pay.
Precisely.
I got a new land-line-number in the early 2000s. One day, I got a collection call for someone with a Mexican surname. I explained I had just gotten the number and I didn't know who that person was. So naturally, they called twice a day for months. I disconnected the line because I was basically paying $20/m for them to harass me. And here's the part I can't explain-- even after being disconnected, the phone would ring but only for the debt collector.
EDIT:
Another story. Solar Panels in the late early 2010s. The ex-wife's father died years ago, once or twice a week, someone would call her cell phone, ask for her dead father and then try to sell her solar panels. They would not stop. It escalated to calls 6 days a week.
I eventually got fed up and told them I'd be happy to come down there with a pistol if they kept calling. I know, not the best choice, but keep in mind this is after 6 months of daily harassment.
The guy on the other end of the phone flipped out, told me “I was committing a federal crime, and he was going to report me to the police and to expect them shortly.” Then, as an intimidation tactic, he read my full name and address-- except it was my dead FILs information.
I told him to go ahead and put his name on a police report so I knew his name.
The calls stopped for one month, and then started again.
It's basically stalking made a profession.. So it draws a certain crowd.
I mean they are extorting your livelihood. I think that’s pretty up there in terms of scummy behaviour.
> Even from a purely self serving perspective, why would they do this?
Because nearly nothing in the world works on the level of individually self-serving, containerized ideas which have direct one-to-one causes and effects.
As an exercise, instead imagine these companies operating on high latency, realtime digital signal graphs running at low sample rates.
Say one of those companies' graphs needs to operate on an incoming stream of 10,000 samples. The company obviously desires the highest frequencies to pass into the "payment received" output.
So they add an "anger-the-boss" filter into the signal chain.
There aren't just direct consequences here-- each change causes a rippling effect for the consequent samples. And that rippling effect clearly changes the behavior of some consequent victims. For example, if victims already heard about these nasty tactics and they want to keep their current job, they might decide to pay if those tactics are still being used.
It probably doesn't get the optimal output for the company. But the article talks about how a 1% change in payment rates can be the difference between success and bankruptcy. Like most realtime systems, they don't have the luxury of screwing around with potentially better outcomes if it ever means missing deadlines for paying the company's bills.
You'd probably drive yourself crazy thinking of all human affairs as low-latency DSP graphs. But I would propose doing the exercise however long it takes to get rid of the pattern of reflexively approaching any new social puzzle by positing a perfectly self-interested and self-contained individual sample.
I think part of it is simply competition against other collection efforts. The scariest collector will probably get paid before the others.
> If your boss gets mad that you have bad debt and fires you, then it’s now even less likely that you will be paying off the debt, no?
It might increase the chances that when you get another job you will agree to start making payments on the debt so that they won't get you fired from that job too.
> I got kicked out for being gay with no notice and had no savings.
Same, in December 2002. Feels a little strange how it works now, compared to be drug out of the barracks by MPs like a criminal. The Army never apologizes.
I'm curious about this. 2002 was before my time, and DADT was mostly before my time, but I've overseen a couple dozen administrative separations for other things (ranging from actual criminal conduct to repeated fitness test failures) as a platoon leader and commander, and I've never seen anything like this.
The bureaucracy will drag out any separation action for months; like at a minimum it will include a series of formal counseling statements by your first-line supervisor and commander, visits to Trial Defense Services, and mental and physical health assessments that take weeks to schedule.
Even in cases of actual criminal conduct, the MPs are very rarely involved. A first-line supervisor NCO would handle the task of escorting the person to their appointments and pulling guard duty if there were some restrictions in place (also rare).
Is there more to these stories?
Yea it’s still not fully accepting but nobody’s kicked out anymore. I know I’ll never get an apology. The US doesn’t apologize.
I do see the occasional person bringing their SO to the Navy and Marine balls.
>Another called me work repeatedly and told my boss
This, in a functional legal system, should have them immediately arrested and/or slapped with a fine.
It probably doesn't matter how functional the legal system is, these kinds of operators will always find grey areas where what they're doing is not technically illegal but still makes your life harder.
Then the law should enumerate very specific actions that only those are allowed (e.g. sending you an email or calling your director home or mobile number only, and only, say, once a month). Anything else should be punishible.
Or the law could get a little more flexible and punish them for their intent, even if what they do is a "gray" area.
Or it could also make "collection agencies" illegal in their entirety.
The other side can just inform you of your debt, once, and if you fail to comply within a legally mandated deadline, they can go through the courts if they want to pursue it further. Who said "debt collecting" companies should be a thing?
The law about collections has been trending towards "only this is allowed" for a long time.
It takes time for the legal system to set precedents and create a legal body of work around issues like these. It moves very slow.
Thankfully, at least for medical debt, there are pretty harsh laws against collections.
Well I sued and got paid, but it wasn’t easy. I’m sure it didn’t change their behavior. They know most won’t sue. The guy who did it is still there working, I looked him up on LinkedIn.
Finding consumer lawyers willing to take FDCPA cases is tough.
I’d love to build tools that automatically exercise your rights as a consumer against these large corporations. The simple truth is that they rely on the social norms of a society as weapons against them, whilst simultaneously breaking the codified ones.
> they rely on the social norms of a society
Norms like being honest and not stealing? society gets really expensive and unfriendly when we have to use enforcement instead of norms.
Can confirm. Cost of transactions in trust-less societies is a very heavy burden. Also, it goes hand in hand with corruption.
They rely on people not knowing their rights or not having the time/ability to fight them.
It's not just a corporate thing, but a problem in the US as a whole that the government banks on. When people are overworked, underpaid, and uneducated then they don't have the time/ability to keep up with politics, fight for their rights, and see how they've been getting fucked by local, state, and federal government for decades.
Wife and I tried to start a business a couple years ago; ran onto circumstances that made it difficult, went bankrupt. We talked to all our credit card issuers about our troubles beforehand, trying to get some better option than "just stop paying"; they were not interested.
Discover actually laughed at my wife when she asked about it: "you're not even delinquent yet!" We were going to be the next day, and would've liked to negotiate before that point. They have no systems for that nor (apparently) any ability to recognize it.
Their comfort zone is this system of debt collections.
They don't have the people, systems, or process to deal with individually negotiated delinquincy plans. They have batch jobs that run daily, if you miss your payment date they hit you with a late fee, then another one in another 30 days, and maybe after 90 days they will close the account and sell the debt. That's all they do, it's strictly based on dates and payments.
You'd think with all the personal profile data they're able to buy and collect themselves, they could identify the accounts that are just in a temporary bind vs. those that are going to be long-term problems. But AFAICT they don't do this.
you dealt with your creditors in a way that a responsible business owner (or farmer) would do it -- like adults dealing with bad news in a long-term relationship. A difference though, is that in consumer credit cards, the scale of the offering made it a whole-new situation. The people you talked to are low-training cogs, and there is almost zero sense of relationship at the scale of consumer credit like that. The people at the top of the consumer credit business were making more money than almost anything in the entire economy, and definitely had no time or consideration for a single small business.
The plus side is that you and your wife were able to access credit very easily compared to the past, the downside is that when you tried to treat it like a long-term relationship, it was shocking how not like that it was. don't change!
Among our creditors was also a local bank (whose customers include a lot of farmers); they were willing to discuss things with us. We managed to pay them off (with a few months of forbearance) and continue doing business with them.
Lovely folks there, I fear the day they get bought up and turn bad.
I had a lot of debt on a Discover card once. I can't remember the exact circumstances, but I do remember that they were awful and will never use that company again.
From the linked piece:
> Well, not all of it. I didn’t inherit the assets. She didn’t leave a will, which meant the state of Tennessee inherited her house. What I inherited was her debt.
Wait, is this right?! In Ireland, and I thought most common-law places, if someone dies intestate, an administrator is appointed, in practice generally the next of kin. Any assets go in the estate, the administrator pays any debts out of the estate. At the end, anything remaining goes to, generally, the person’s children (there are more rules for if there are no living kids or parents). If debt exceeds assets, then some debts are paid, the estate is closed, and that is the end of that; the creditors generally have no further recourse, and certainly no recourse against the debtor’s kids. Is this not how it works everywhere, more or less?
When you die, your debts don't die with you - they are still part of your estate.
The major function of the executor of an estate is to settle the debts of said estate. If the estate runs out of money (even after selling property, for example) before paying all the debtors, according to order of seniority, then everyone else in line is out of luck.
However there are quite a few states with "filial responsibility" laws (Tennessee is one of them) that oblige children to take care of their parents in usually vague and under-specified ways ... those have been used to chase children for unpaid nursing home debts etc.
> However there are quite a few states with "filial responsibility" laws (Tennessee is one of them) that oblige children to take care of their parents in usually vague and under-specified ways
Huh. Interesting; was totally unaware that was a thing.
Some places seem to go further:
> Singapore, Taiwan, India, and Mainland China criminalize refusal of financial or emotional support for one's elderly parents
Emotional support! Idea for Chinese sitcom; awful couple make life difficult for their adult children, on the basis that the children are legally required to be nice to them.
“You have to pay your parent’s posthumous debts” still seems like a hell of a leap from “you have to take care of your parents”, tho. I’m very surprised more states haven’t repealed these (looks like about half of US states have one, though it’s not clear how active they are).
That's how it pretty much works in the whole United States. This isn't the first article I've seen where the author passes on the notion that debts are inherited. You would think an author would have a duty to their audience that they should inform them about the truth and help prevent them from falling into this trap, but instead we get stories about people working to pay off inherited debts, normalizing it.
People love stories.
Cory read (and linked) this: https://www.bitsaboutmoney.com/archive/the-waste-stream-of-c...
but missed this bit:
> A second scrub will typically remove dead debtors, because they infrequently answer their phones. (Debts are not inherited in the United States, a fact which the debt collection industry frequently demonstrates strategic ignorance of.)
Yeah, that's how it works here in Tennessee too. Not sure what happened.
Edit: looks like the literature referenced was from almost 200 years ago.
Only thing I can think of is that the author was a guarantor on the mother’s debt. Which I suppose is possible. Even still though I don’t understand why the house would go to the state.
The book she mentions is pretty old, but the situation with her mother she mentions is current.
The house going to the state could be due to Medicaid reimbursement. But I share your general frustration that when such details are glossed over it tends to propagate myths (two, in this example). If this is what happened, a will wouldn't have helped. Deeding over the house while keeping a life estate or putting it into a formal irrevocable trust, before the lookback period, could have.
> Without addressing the politics of it, the impression among many informed people that most defaulted debt is medically-related is the result of successful advocacy work rather than being substantially based in reality.
Is this actually an impression informed people have? I’m the prime target for such opinions because of my issues with the U.S. healthcare system, but even I always understood the common understanding to be that most bankruptcies are caused by medical debt, and not debt defaults in general (most debt default doesn’t lead to bankruptcy, especially with credit card debt. It usually just leads to a payment plan).
>I’m the prime target for such opinions because of my issues with the U.S. healthcare system, but even I always understood the common understanding to be that most bankruptcies are caused by medical debt, and not debt defaults in general
Only 4% of US bankruptcies are because of medical bills. <https://www.washingtonpost.com/blogs/post-partisan/wp/2018/0...> A tipoff that [insert large percentage here] of bankruptcies aren't actually because of medical costs is that only 6% of bankruptcies by those without health insurance are because of that cause. The biggest cause of bankruptcies is lack of income, which health insurance doesn't affect anywhere in the world.
This headline/article is silly.
Yes, it's optional in the sense that you won't go to prison.
But if you want any chance of being able to take out a mortgage on a house, or to finance a car purchase, then it's not very optional. Not to mention a bad credit score makes it much harder to even rent many apartments.
Also, lenders will sue you if you have the money. In which case it's no longer optional either, when they win.
The article is about shady practices of debt collectors, but in no way does that ever make a leap to the idea that paying consumer debt is "optional". If you don't pay, it generally has real negative consequences. It's up to you whether those consequence are worth it.
>If you don't pay, it generally has real negative consequences.
If you owe a lot of money on your credit cards, the lender will actually sue you - rather than selling the debt - and then put a lien on your property. I once bought a house in an estate sale which was also a short sale (I do not advise this) and both American Express and another bank had done this to the prior owner who owed $20-30K.
> I do not advise this
That sounds like an interesting story...
It's not that interesting - it's just that there is a much larger number of parties who have to be in agreement about the sale, and the sale price, than is typical - you end up with probate court judges, lien holders, the executor, the estate's attorney as well as possibly a second real estate attorney for the estate and absolutely all of them (and their staff) can be sick / on vacation / golfing which wreaks havoc on the closing timeline.
Plus if there is any FUBAR paperwork it is much more difficult to fix if it means going back to probate court to (for example) add a spouse who was wrongly omitted from the approval to sell ... in this case, I ended up getting the mortgage and deed by myself and then quitclaiming the property to the two of us because that was less hassle.
Oh, and short sales in probate are basically always as-is because the estate has no money to make good any repairs to the property.
Thanks for the explanation... so yea... it sounds like everyone dips their fingers into the pie and by the time you take ownership, you've paid almost as much as a regular house purchase. I mean "paid" not just in the financial sense, but also in time/energy/sanity.
Link to Patrick McKenzie (the actual source, rather than Cory Doctorow's blogspam):
https://www.bitsaboutmoney.com/archive/the-waste-stream-of-c...
Is it still blogspam if this paragraph exists in the end of the post?
McKenzie doesn't know what will fix this. But Michael Hudson, a renowned scholar of the debt practices of antiquity, has some ideas. Hudson has written eloquently and persuasively about the longstanding practice of jubilee, in which all debts were periodically wiped clean (say, whenever a new king took the throne, or once per generation): https://pluralistic.net/2020/03/24/grandparents-optional-par...
He then summarizes Hudson's position that "debt's that can't be paid won't be paid", and goes on to share a few other stories related to this problem.
>Is it still blogspam if this paragraph exists in the end of the post?
I have no particular opinion on that question but, having read the original patio11 post, virtually 90% of this one is just paraphrasing of its contents.
> Is it still blogspam if this paragraph exists in the end of the post?
yes
> One other thing debt collectors due is robo-sue their targets, bulk-filing boilerplate suits against debtors, real and imaginary. If you don't show up for court (which is what usually happens), they'll get a default judgment, and with it, the legal right to raid your bank account and your paycheck. That, in turn, is an asset that, once again, the debt collector can sell to an even scummier bottom-feeder, pocketing a lump sum.
I feel like this paragraph basically invalidates the rest of the article. If it's this easy for them to sue and get legal access to your money how is paying "optional"?
It's optional, because for a lot of smaller debts (<5000) they won't bother suing. They'll sell it for 0.1x cost to a collection agency and move on.
They get to mark it 90% of it as a loss on their balance sheet and pay less taxes as a result.
Isn't there like a credit score system in the US that companies can check?
In Mexico there's something called the Credit Office (buró de crédito) that banks can check if you've paid all your debts.
Aaah but in Mexico exactly the same thing happens: you can basically ignore Buro/Circulo de Credito and after 6 years by law they have to drop any unpaid debt report.
I worked in a Mexican credit startup 10 years ago and one of the main issues we dealt with was just that: there is no legal mechanism for a lender to recover the money they borrow. Not paying a loan is not illegal. And people in Mexico have 0 financial education .
So you have to include your default rates as part of your lending model. 30% default first loan. 15%-20% default mixed 2nd+ loan .
That in addition to a base bond rate of 10% (you can lend your money to the Mexican government for an extremely secure 10% interest) is what makes credit in Mexico Soooo expensive.
I have a friend who is lawyer and used to work in the enforcement area if Scotiabank mortgages . The stories he tells about people that just decided not to pay their mortgages but had 4 or 5 Harley Davidsons in their houses when they went to evict them... among other crazier stories.
There is, and a good rule of thumb is that if it's a bad trait of your government... Most likely learned it from the US.
That’s not actually a good rule of thumb, nor is there any government credit agency in the US.
Wrong on both counts.
When creditors sell debt to collections they should be required to allow the debtor to buy their debt back at that price.
Of course they'll never actually do that. Usurers are unreceptive to any notion that you won't pay every last extortionate penny. They'd rather sell it to collections for 5 cents on the dollar than let you settle for 50 in a straightforward conversation.
I think that'd be hard in practice since the article mentioned that they're sold in bulk. Sending offers to everyone in a package would be difficult.
But I wonder if it could be possible to crowd fund something like this, or have a non-profit that just buys cheap debts like this and forgives them all? Idk what that would cost, but it could help shrink the shady debt collector industry a little.
Forgiven debt counts as income. There's some messing you can do with it, like I think one of the latenite hosts did with some student debt.
The whole sold-in-bulk thing I could see being 'remedied' by having some sort of federal clearinghouse that each item of debt has to pass through. Though, that'd probably get fought tooth and nail so money-men can pull subprime-shenanigans.
As a lawyer who has fought a few collection cases, I would disagree with the notion that the collectors typically can’t document the debt. They can. Moreover the fdcpa doesn’t require the collector to prove the debt to you with absolute metaphysical certitude. They just have to verify it.
Hmmm...
One would expect that the cases that actually get to the point of lawyers and courts are atypical. It seems likely that the ones who can't document the debt would probably drop the matter when first challenged, long before that stage.
Is that not the case?
I know someone who walked away from £15k of credit card debt because the collection company sued with forged paperwork.
He happened to have all the original paperwork on file and it proved they hadn't followed the required legal procedures.
Trying to forge an essential document wasn't going to help their case.
I've heard from a number of people who work for banks, lenders, and insurers that record keeping is a complete mess, and a certain amount of unlawful creative improvisation isn't unusual.
So... they may claim to have proof, but there's a reasonable chance that if it's examined closely and/or all original correspondence is kept, they don't.
This seems to be worse in the US where debts are traded and retraded and the original paperwork may be long gone.
These were as typical as they get - random credit card debts. Friend of a friend got sued and asked for help.
I serve discovery thinking they’ll never be able to respond, they do.
Banks and card companies absolutely sue people as well — not just third party debt collectors. Discover obviously has the documentation, they can produce it.
I’d like to know the deciding factor for sue or sell.
> the vast majority of consumers, including those with the socioeconomic wherewithal to walk away from their debts, feel themselves morally bound and pay as agreed
The extent to which the headline is true is probably only because of the above quote. If a significant number of people who actually had the means to pay simply chose not to, of course debtors would start taking collection more seriously.
Perhaps this means you could game the system, but I’m still skeptical that any debtor would choose not to sue you over 20k+ if they thought you had the means to pay.
People with 20k of delinquent debt and the means to pay it are a bit of an edge case, though; mostly people that collections agencies go after will not have the means to reasonably pay their debt, at least not all of it. This encourages agencies to be more aggressive; they want _their_ debt to be first in line for anything that does get paid.
I've had things go to collections twice in my life, both times were some bill I forgot about and moved away and the first time I heard about being delinquent was the collections call. One time I asked for the evidence and they actually did mail me all the documentation and proof of the debt. The other time I asked for documentation and ended up never hearing from them again. I still don't really know what that debt was, it never appeared on my credit history or anything else.
Reminder. There are states that protect your home from judgements: "exempts homestead property from levy and execution by judgment creditors". Medical bankruptcy should be expected and planned for - as you age it will be difficult to get health insurance. Move to states that will protect your home.
> as you age it will be difficult to get health insurance.
Are you unaware of Medicare and Medicaid?
The comedian (?) Sam Hyde is famous for doing this: https://www.youtube.com/watch?v=BD5anPSzS-0&t=220
I wish there was a way we could automatically garnish any gratuities a debtor makes and put them toward a debt instead of the original business. With credit cards it should be more possible to do this.
One reason to pay is because you plan to borrow again
But if its already reached collections then it doesn’t really make a difference to your credit eligibility for the next X many years
Its weird at that point it wont drop off whether you pay the collections or not, for 7 years so theres literally zero incentive to pay the collections off.
I thought once you paid the debt the credit score should improve, no?
It improves but collections are an adverse notice on your credit report that stay for 7 years. Its different from just holding a high balance on the card.
The score almost means nothing with them present.
I once had a collections report on my credit history. I paid off the debt and asked them to remove it, a few days later it was gone as far as I could tell.
Not that everyone's experiences will be like this, just pointing out it is not necessarily always 7 years on the report.
So if I want to finance a new car, does it make a difference whether the debts are paid or not?
Yes - unpaid charge-offs are more derogatory than paid ones - I'm not sure that hits (say) a FICO score but lenders that look at a full report can tell the difference.
You can believe that collection agencies behave illegally and also think that is unethical not to pay your debts to the best of your ability. Even if paying consumer debts is optional, not being able to get credit in the future, especially a home mortgage, is an incentive to pay. Some employers check the credit scores of applicants, and such scores probably are a decent indicator of whether someone has their life in order.
Once the debt has been sold off, it's very likely that your credit score has already been impacted.
On the ethics front: let's say I owe money to a credit card company. They sell it off to EZ-Sleez, the debt collection company. What do I owe to them? I certainly didn't borrow money from them. We have no particular relationship. They have one with the credit card company, but that's none of my business, from an ethics standpoint. The idea of selling debt itself feels very unethical to me, and I'd like to see that justified before we talk about what we may or may not owe people.
I've had a debt go to collections one time. It was a medical bill that I had somehow lost track of (or maybe never received). It was legit but I had never seen it. I will say that the collection company was very cordial and almost apologetic, I told them I would need to confirm the debt since it was a complete surprise, which I did, and I paid the provider (not the collector) directly. Never heard from them again, and it never affected my credit score.
You have a relationship; creation of the relationship was enabled if not formed when you signed the card agreement and agreed that your debt could be sold, transferred, or exchanged to or with a third party. If you thought that was unethical, you should have redlined it at the time.
And then the credit card company would have told me to piss right off, and I'd be struggling to live in American society without credit cards or a credit score.
I was just in line at the grocery where an elderly couple bought $600 worth of groceries and paid by check. I wasn't even sure stores still took checks.
> Once the debt has been sold off, it's very likely that your credit score has already been impacted.
Right — this “optional” description really only means anything after the borrower has nuked their credit for many years.
> The idea of selling debt itself feels very unethical to me
You must be appaled by the existence of the global bonds market then.
I'm guessing you agreed that the CC company could sell your debt when you signed up for the card.
Could be! But I'm not sure that a coerced choice - "if you don't pay us exactly on time, we'll sell your information to criminals who'll harass your family" - is itself ethical.
And yes, it is a coerced choice. It's difficult to live in modern American society without a credit card, or a credit score which is very difficult to keep high without a credit card.
It's not that difficult to live without a credit card. Debit cards don't have that same collections concept and can almost always be charged through credit card networks netting the same outward experience.
As for not building a credit score, well, it sounds like you're not really interested in taking out loans in terms that others wish to offer them, so what good is a credit score? The people who care about credit scores are largely the same who will only do contracts with collections classes and be unwilling to adjust contracts. If you're working with a lender who is willing to change contracts like that they're probably also going to be fine evaluating your non-normal financial arrangements.
You are being hyperbolic, and the argument isn’t strong.
In both California and New York I had to prove I had good credit to rent a half decent apartment. And I don’t blame the landlords, plenty of people sign leases and never pay. I think lots of people take advantage of a system that is designed to have protections for those who hit hard times.
Every ecosystem will have parasites, at every trophic level.
That's why the interest is so high...
What's with people not offering RSS?
control f rss works.
Well that's embarrassing.
Thank you.
Federal debt? gov keep borrowing or printing more to payoff past debts
college debts? hope Dems get power in DC
biz debt? declare bankruptcy
its hard to find a type of debt that cant just be magically blinked away with a procedural wave of the hand
> college debts? hope Dems get power in DC
Pointless unless the root cause is addressed first
> hope Dems get power in DC
And they want to do debt forgiveness as opposed to another war.
They’re financing a war right now
>biz debt? declare bankruptcy
That's totally an option for individuals too (modulo student debt for the most part).