4 ms·

Why if lenders are willing to sell the debt at cents to the dollar, dont they just offer that deal directly to the person who is in default? They may be able to

• jmaygarden 14y ago
  You could ask the same question about why restaurants don't give away their leftover food directly to customers. It sets a bad precedent from their point of view.
• corkill 14y ago
  Often the person in default is not willing to make any more payments, they have essentially given up on paying off the debt or they may feel the loan is unfair. The larger reason is that collecting debts becomes a lot harder if consumers know that the lender will just reduce what they owe if they hold out.
• ThomasGokey 14y ago
  But wouldn't this be great? I think it would be fantastic if we could some how organize so that people could buy their own debts for pennies on the dollar. It seems difficult for several reasons. Collection agencies often have a wide range of flexibility and can almost always get rid of the ridiculous fees that are added for missing payments. Most of the time they're just trying to figure out how much they can realistically bleed out of someone and go for that. A well informed person should be able to cut a deal with a collector, but if you're in that situation you've already had your credit ruined.
• smsm42 14y ago
  AFAIK, they kind of do. If you are in default and not paying big credit card bill for significant time, for example, there are chances they'd agree to close it for much less than payment in full. Maybe not cents on dollar, but significantly less than 100%. I wouldn't recommend this as a way to get rich though :)