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"This just seems completely irrational. Do lenders imagine they're more likely to recover their money this way?" In theory this punishment can increase the tot
by nawitus 9y ago
"This just seems completely irrational. Do lenders imagine they're more likely to recover their money this way?"
In theory this punishment can increase the total number of loans paid, even if the individuals who default and lose their jobs won't be able to pay their loans back. Why? Perhaps the fear of the punishment incentives loaners to not default.
- Sniffnoy 9y agoI mean, yes, I understand that line of reasoning, but like... were any actual calculations done? This just seems like such a bad idea when (as is pointed out in the article) there are plenty of other things you could do in such a case that won't so adversely affect your ability to recover your money.