8 ms·

How is the court standing on people's necks? If someone takes something from me, and doesn't return it, should I not have the right to take it back? As far as

How is the court standing on people's necks? If someone takes something from me, and doesn't return it, should I not have the right to take it back? As far as I am aware no one is forcing people to take on loans at gunpoint (other under threat of some criminal act being committed against them), not would any court enforce a debt incurred in such a way, so what exactly is the problem here? Don't take on debt you can't afford to pay back and you won't have a problem. Don't default on your debts and you will never have a problem.

flangola7 4y ago
Willful and unimaginative ignorance is boring.
hammyhavoc 4y ago
Gunpoint or not, a lot of people take loans out of survival instinct. I'm not saying loans good or loans bad, nor am I saying financial literacy good or bad, but I am saying that clearly a lot of loans and credit cards are given to people who in all likelihood cannot easily pay them back and this is either a failure of the issuer at best or predatory at worst.
- johngladtj 4y ago
  So you agree that these people of their own free will chose to take on that debt. The credit companies did take into account the likelihood that they wouldn't be able to repay (both willingly and unwillingly), that's the reason for the interest rate they charge. Is your stance that people should be able to make deals and then renege on them after they received the benefits with no recourse for the other side? Can you give me a single consistent standard for your view? Because from what I can tell your entire argument seems to boil down to "I like the debtors and hate the creditors, so I'll support whatever takes from the creditors and gives to the debtors, regardless of the harm those policies cause".
  - ParetoOptimal 4y ago
    > The credit companies did take into account the likelihood that they wouldn't be able to repay (both willingly and unwillingly), that's the reason for the interest rate they charge. The problem is they aim to not get paid back in full so they receive payments far in excess of the original loan amount in perpetuity. They aim to trap the people in a bad spot taking their loans.
    - johngladtj 4y ago
      I can assure you that no credit provider wants it's clients to default. You're confusing accepting the risks and cost of some defaults with desiring the defaults. The first is a reasonable decision based on risk-benefit analysis. The second will get your company into bankruptcy. Seriously rethink this preconception you have, because it's not in line with reality, and directly goes against the very interests (profit) you seem to think motivates them. The ideal borrower for these companies is one that always pays their debt on time, and comes back next month for more.
      - ParetoOptimal 3y ago
        > The ideal borrower for these companies is one that always pays their debt on time, and comes back next month for more. I do not think that is true. I think they'd rather be taking whatever they can from as many borrowers as possible, milking them for all they are worth. If you limit your ideal borrower to "pays on time every month" you limit your income ceiling quite a lot. > You're confusing accepting the risks and cost of some defaults with desiring the defaults. The defaults can be desired if the late fees and penalties are high enough and a high enough portion of those get paid. This is the exact business modal of the almost universally predatory payday loan "businesses" for instance.
        johngladtj 3y ago
        Note how I said nothing about limiting lending to borrowers with no credit risk (that's impossible to start with) Indeed I specifically mentioned: >You're confusing accepting the risks and cost of some defaults with desiring the defaults. Defaults are always a bad thing, and those fees don't make up for it because there are costs involved with collecting from defaulting borrowers, if you can even collect in the first place. A company whose business model involves hoping their customers default will very quickly go out of business.
LocalH 4y ago
If person A borrows money from person B, and person B (for whatever reason) writes off and forgives that debt, person C should not be able to swoop in, buy the discharged debt, and reactivate it. The situation you described is not at all what this is referring to. My credit is shit, because when I was much younger, I stupidly ran up a bunch of debt and was unable to pay it. However, the creditor completely forgave the debt a few years down the road, near the end of December, and as I looked into it, the IRS counts that as reportable income and thus affected my taxes that year. Should some third party be able to resurrect that, a third party to whom I never owed money? I don't really think that should happen in a just system. I wonder if having proper documentation to the debt cancellation would be a defense against ugly shenanigans like this. If our governing system wants respect, then they really shouldn't be using the dirtiest tactics they possibly can to extract every drop of blood from so many stones. The state having a monopoly on violence does not mean that all use of that violence is justified or appropriate.
- johngladtj 4y ago
  A write off is not debt forgiveness, nor does it remove your responsibility or their right to collect on that debt. From your comment it's clear to me that you don't actually know what's happening here. When a company "writes off a debt" what that means is that they record and expense in their income statement. Effectively they are saying "we don't think we can get all the money we are owed, and so we are reducing the estimated value of that asset in our balance sheet". This write off has accounting implications, and may have tax implications (since otherwise they'd be taxed on interest they are not receiving). Importantly this write off does not change the contract, or the money owed. It just means that when (if) some or all of the money is paid, any extra beyond the current carrying value of that asset is allocated to the companys income (and taxes are paid on that). The second thing you seem to misunderstand is that company c doesn't come out of nowhere. They simply purchased the debt from the original lender (perhaps because they are specialized in collecting from defaulting borrowers), and are collecting the debt they are owed.
  - LocalH 4y ago
    Ok, you're probably right about the difference between forgiveness and writing off, and I'll accept that. On that last sentence though, how is that not "coming out of nowhere"? They're not the original company owed, they had nothing to do with lending for the original debt, the only reason they're even there is because they very specifically "specialized in collection from defaulting borrowers" - that is a grift as far as I'm concerned. Such debt collectors don't always follow the law in getting what they claim as "their" money (although to be clear I am not making a generalized claim to all such collectors). Morally speaking, the original debtor does not owe anyone but the original lender, or any company that acquires that lender, as far as I'm concerned. Debts should not be able to be transferred between lenders except for the cases of outright acquisition. Nobody should be able to buy up these debts in this fashion. This world needs less middlemen, not more.

flangola7 4y ago

Willful and unimaginative ignorance is boring.

hammyhavoc 4y ago

Gunpoint or not, a lot of people take loans out of survival instinct. I'm not saying loans good or loans bad, nor am I saying financial literacy good or bad, but I am saying that clearly a lot of loans and credit cards are given to people who in all likelihood cannot easily pay them back and this is either a failure of the issuer at best or predatory at worst.

johngladtj 4y ago
So you agree that these people of their own free will chose to take on that debt. The credit companies did take into account the likelihood that they wouldn't be able to repay (both willingly and unwillingly), that's the reason for the interest rate they charge. Is your stance that people should be able to make deals and then renege on them after they received the benefits with no recourse for the other side? Can you give me a single consistent standard for your view? Because from what I can tell your entire argument seems to boil down to "I like the debtors and hate the creditors, so I'll support whatever takes from the creditors and gives to the debtors, regardless of the harm those policies cause".
- ParetoOptimal 4y ago
  > The credit companies did take into account the likelihood that they wouldn't be able to repay (both willingly and unwillingly), that's the reason for the interest rate they charge. The problem is they aim to not get paid back in full so they receive payments far in excess of the original loan amount in perpetuity. They aim to trap the people in a bad spot taking their loans.
  - johngladtj 4y ago
    I can assure you that no credit provider wants it's clients to default. You're confusing accepting the risks and cost of some defaults with desiring the defaults. The first is a reasonable decision based on risk-benefit analysis. The second will get your company into bankruptcy. Seriously rethink this preconception you have, because it's not in line with reality, and directly goes against the very interests (profit) you seem to think motivates them. The ideal borrower for these companies is one that always pays their debt on time, and comes back next month for more.
    - ParetoOptimal 3y ago
      > The ideal borrower for these companies is one that always pays their debt on time, and comes back next month for more. I do not think that is true. I think they'd rather be taking whatever they can from as many borrowers as possible, milking them for all they are worth. If you limit your ideal borrower to "pays on time every month" you limit your income ceiling quite a lot. > You're confusing accepting the risks and cost of some defaults with desiring the defaults. The defaults can be desired if the late fees and penalties are high enough and a high enough portion of those get paid. This is the exact business modal of the almost universally predatory payday loan "businesses" for instance.
      - johngladtj 3y ago
        Note how I said nothing about limiting lending to borrowers with no credit risk (that's impossible to start with) Indeed I specifically mentioned: >You're confusing accepting the risks and cost of some defaults with desiring the defaults. Defaults are always a bad thing, and those fees don't make up for it because there are costs involved with collecting from defaulting borrowers, if you can even collect in the first place. A company whose business model involves hoping their customers default will very quickly go out of business.

LocalH 4y ago

If person A borrows money from person B, and person B (for whatever reason) writes off and forgives that debt, person C should not be able to swoop in, buy the discharged debt, and reactivate it. The situation you described is not at all what this is referring to. My credit is shit, because when I was much younger, I stupidly ran up a bunch of debt and was unable to pay it. However, the creditor completely forgave the debt a few years down the road, near the end of December, and as I looked into it, the IRS counts that as reportable income and thus affected my taxes that year. Should some third party be able to resurrect that, a third party to whom I never owed money? I don't really think that should happen in a just system. I wonder if having proper documentation to the debt cancellation would be a defense against ugly shenanigans like this. If our governing system wants respect, then they really shouldn't be using the dirtiest tactics they possibly can to extract every drop of blood from so many stones. The state having a monopoly on violence does not mean that all use of that violence is justified or appropriate.

johngladtj 4y ago
A write off is not debt forgiveness, nor does it remove your responsibility or their right to collect on that debt. From your comment it's clear to me that you don't actually know what's happening here. When a company "writes off a debt" what that means is that they record and expense in their income statement. Effectively they are saying "we don't think we can get all the money we are owed, and so we are reducing the estimated value of that asset in our balance sheet". This write off has accounting implications, and may have tax implications (since otherwise they'd be taxed on interest they are not receiving). Importantly this write off does not change the contract, or the money owed. It just means that when (if) some or all of the money is paid, any extra beyond the current carrying value of that asset is allocated to the companys income (and taxes are paid on that). The second thing you seem to misunderstand is that company c doesn't come out of nowhere. They simply purchased the debt from the original lender (perhaps because they are specialized in collecting from defaulting borrowers), and are collecting the debt they are owed.
- LocalH 4y ago
  Ok, you're probably right about the difference between forgiveness and writing off, and I'll accept that. On that last sentence though, how is that not "coming out of nowhere"? They're not the original company owed, they had nothing to do with lending for the original debt, the only reason they're even there is because they very specifically "specialized in collection from defaulting borrowers" - that is a grift as far as I'm concerned. Such debt collectors don't always follow the law in getting what they claim as "their" money (although to be clear I am not making a generalized claim to all such collectors). Morally speaking, the original debtor does not owe anyone but the original lender, or any company that acquires that lender, as far as I'm concerned. Debts should not be able to be transferred between lenders except for the cases of outright acquisition. Nobody should be able to buy up these debts in this fashion. This world needs less middlemen, not more.