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The People's Bailout

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Re: The People's Bailout

#191

Post by downandout »

malandrew wrote: post #52
downandout wrote: post #38

Earlier quoted context omitted.

That isn't entirely true...if the owner of the debt (whether or not it is the original owner) decides to delete it from the credit record, then they can. In fact, many debt buyers act this way - they buy the debt for pennies on the dollar, and then offer to delete it if the person pays, for example, 25% of the amount owed. As mentioned elsewhere, this is know as PFD or "Pay for Delete". Most of the major credit burea…

Will that delete the history of that debt from the original creditor or only the creditor currently holding that debt?

My understanding is that it erases the debt completely.

Re: The People's Bailout

#192

Post by kijin »

noonespecial wrote: post #126

I detect the possibility of a closed debt-like loop. There must be a way in this system to buy my own $14,000 debt for $500 and forgive myself . Its just a matter of path-finding. So theoretically, I can travel backwards in debt... Profit!

Very interesting possibility.

Perhaps OWS should buy a debt for $500, and instead of outright forgiving it, sell it back to the debtor for a symbolic amount such as $1. Maybe this will have different tax implications than what the top comment suggests?

Re: The People's Bailout

#193

Post by downandout »

patio11 wrote: post #25

For the benefit of folks who might not understand how debt collection works, which may include OWS: if you buy $10,000 of an individual's debt for $500 and then forgive the debt, they have just incurred income of $10,000 and are obligated to pay taxes on it exactly as if you had handed them $10,000 in cash for services rendered. If you don't inform the IRS that you forgave the debt, via a 1099-C, you're going to get…

Why not ask the people to make nominal payments, and use those payments to purchase additional discounted debt? This would both solve the IRS problem and potentially make this a self-sustaining venture.

Re: The People's Bailout

#194

Post by Millennium »

logn wrote: post #111
lifeformed wrote: post #108

Earlier quoted context omitted.

Isn't this also bad for your credit? Well, I guess maybe it's just less bad than bankruptcy or not paying anything at all.

I'm no expert in credit scores, but... If the original creditor already filed with the credit bureaus, that's definitely a negative on your credit. But I think the OWS can report that you "repaid" the debt which would be good. They could also bargain with the creditor to remove the negative report. Also, just reducing your balance of debt is good for credit. Plus, I don't think there's anything worse you can do for y…

IIRC, if your debt is being sold to a broker at pennies on the dollar -which is pretty much the only way OWS can get its hands on it- the bank has already long since given up on getting you to pay, and the credit bureaus have long since been informed. In other words, the damage to your credit is mostly already done; an actual bankruptcy would hurt worse, but you're still in for a world of pain.

Re: The People's Bailout

#195

Post by eli_gottlieb »

tsotha wrote: post #168
btilly wrote: post #156

Earlier quoted context omitted.

>Not when the majority of jobs that create a vibrant middle class in the post-industrial United States require at least a college degree. That's a self-refuting argument. If your degree was really the ticket to a "vibrant middle class" job you'd be able to pay off your student debt. You just failed at basic logic. Saying that jobs of type X require a degree IS NOT saying that getting a degree guarantees that you will…

>Saying that jobs of type X require a degree IS NOT saying that getting a degree guarantees that you will get a job of type X. No, but he was talking about the majority of jobs. I understand people get unlucky. That's life. But there's a huge disconnect between what the population of college students is paying for degrees and what the job market is paying for labor. This isn't a question of some small percentage of p…

Dumb decisions like becoming a medical doctor? This isn't a matter of what decision someone's wife made. You just like blaming the victim by default and forcing them to defend themselves before your imagined seat of justice.

Re: The People's Bailout

#196

Post by elemenohpee »

philwelch wrote: post #148
frio wrote: post #99

Earlier quoted context omitted.

So what if the shoe's on the other foot? A driver hits someone. The driver doesn't have insurance. He's now liable for the other person's medical bills, but can't afford them. He's now massively in debt over some random accident. No matter the moral judgment ("he shouldn't be driving without insurance"), the underlying point was that random debt does happen :).

Not only should he not be driving without insurance, but he's almost certainly at fault for hitting the pedestrian. We put some debtors into prison for lesser forms of irresponsibility.

That's great, unless he needs to drive to get to work in order to get a paycheck and keep his head above water for another week. Do people really not understand that there are people who do not have the luxury of a risk-free life?

Re: The People's Bailout

#197

Post by eli_gottlieb »

smsm42 wrote: post #145
sc68cal wrote: post #95

Earlier quoted context omitted.

That's why we have bankruptcy laws. Yes - bankruptcy laws that were passed in 2005 which made it significantly harder to get debt forgiven in bankruptcy, and also removed some forms of debt from being able to be discharged in bankruptcy: https://en.wikipedia.org/wiki/Bankruptcy_Abuse_Prevention_an... It was widely claimed by advocates of BAPCPA that its passage would reduce losses to creditors such as credit card com…

Many jobs require a degree, but not every degree leads to a job. Unfortunately, easy access to huge loans and widespread confusion about the relationship between the degree and the paying jobs has lead to ever increasing number of people in huge debts with no way to repay it ever. It reminds me some recent history when people got into huge debt in order to get something that is sure to provide them huge value and mak…

The problem is that not getting a university degree still makes you far more likely to end up poor. So people are still making the "rational" investment, which is to take a 40% chance of a good job over a 10% chance (numbers pulled from my ass, but you get the point).

Re: The People's Bailout

#198

Post by eli_gottlieb »

philwelch wrote: post #153
intended wrote: post #133

Earlier quoted context omitted.

Yeah I can get behind that people should have known. But in the case of the Mortgage Market prior to the crash I can't - simply because it wasn't an equal/level playing field. In brief 1) CDOs => Mortgage Origniators no longer held back by their risk levels. CDOs can just offset it. 2) MOs incentives are now drastically different - Incentive now entirely to generate as many mortgages as possible, whatever the risk pr…

The fact that lenders were able to win short term profits from the ignorant and irresponsible does not exonerate the ignorant and irresponsible.

Ignorance is, in fact, the traditional defense against responsibility. And yes, sufficient ignorance absolves.

Re: The People's Bailout

#199

Post by eli_gottlieb »

mseebach wrote: post #116
paulhodge wrote: post #39

Earlier quoted context omitted.

You can read their whole explanation, it's an interesting read: http://strikedebt.org/debt/ Short answer: various methods of systematic trickery and financial booby-trapping perpetrated by, you guessed it, the 1%.

In shock revelation, OWS blames all ills of world on "the 1%". Film at, you guessed it, 11. One of the reasons OWS isn't more popular is that 99% of the 99% understands that the vast majority of personal debt was and is incurred by regular people living beyond their means, and not by nefarious schemes by nefarious monocle-wearing capitalists. Unsympathetic as it might be, they merely provided the rope.

Almost all debt I've seen was generated by either medical problems or going to university.

And I say this as someone with no debt whatsoever and a reasonable income each month that I live within. You are talking nonsense.

Re: The People's Bailout

#200

Post by elemenohpee »

bo1024 wrote: post #154
vinhboy wrote: post #61

Earlier quoted context omitted.

Buying a random stranger's debt with your own money, with no expectations of re-payment or even a personal thank you is entitlement?

I'm not much of an OWS supporter, but a lot of the criticism of it really bothers me. Just a lot of hypocrisy to be frank. - This entitlement thing. I don't see what's entitled about giving one's own time or money to a cause you believe in, to go camp out for weeks or whatever. It seems like a lot of criticism of OWS centers on them acting like they deserve to be given jobs, but I have trouble taking this seriously w…

> Civil liberties and free speech are supposed to be the cornerstone of American democracy and yada yada, but people suddenly feel extremely threatened when people want to exercise them.

Notice the government doesn't get their panties in a bunch over the Westboro church, or Tea Party townhalls, but turn your attention towards the plutocrats and suddenly there's riot police in the street. The fact that the government feels threatened lends credence to their critique.

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