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Occupy Buying Debt?

12 November 2012 by

Occupy Buying Debt?

One thing we’ve learned about the Occupy movement: assume nothing. You may recall the protest movement that begun with a small group of consumers who were fed up with the growing bank and credit card fees.

They began as a group with a common complaint: frustration with corporate greed and corruption. Within weeks, the movement grew from a few hundred to a national movement that was making headlines around the world. And now, the group has just upped its ante.

Rolling Jubilee

Occupy Strike Debt was the second phase of the group’s efforts and it’s new campaign, Rolling Jubilee, has now taken to buying up debt from everyday consumers and then forgiving that debt. Nice, right?

Not only that, but the group is also coordinating a telethon and even a variety show (please, please let it be similar to those 70s classics) tentatively named The People’s Bailout scheduled to air on November 15 in New York. The goal is to raise money to support those buyouts. Those proceeds will be used for that purpose alone. And what are some of the debts they’re looking to pay off? Take a look:

  • Student loan debt
  • Credit card debt
  • Unsecured loans
  • Medical debt

It says it wants to put an end to both predatory lending and then predatory collection efforts.

The basic premise is simple: people shouldn’t have to go into debt for an education, because they need medical care, or because they have to put food on the table during hard times,

Occupy’s website says.

Collection Efforts

As millions of Americans have learned in recent years, when they are unable to meet their financial obligations, banks, credit card companies and medical facilities will sell that debt to collection agencies or other debt collectors at significantly lower costs. The original lender is able to recoup some of its losses and the agencies are able to keep whatever they are able to collect through whatever methods they deem necessary (and sometimes those methods are unethical and even illegal).

Now, the Strike Debt campaign will essentially go into competition with those collection agencies to buy that debt, sometimes pennies on the dollar, and then forgive the debt. They will make no attempts at all to collect the money owed. They say it’s a “simple, powerful way to help folks in need”. One of the organizer’s, David Rees, wrote about the effort in his blog and said their first focus is on those communities hardest hit by the recession. Already, the group says it’s eliminated more than $500,000 in debt for consumers. Impressive, right?

Want to help? You can buy tickets to the fundraiser for as little as $25. The group says this will allow it to eliminate $500 in debt for consumers. Pay $250 for a ticket and you will have erased $5,000 in debt.

There’s no doubt folks are becoming desperate. Recently, there’s been a surge of people posting ads on Craiglist looking for financial help in the most unlikely ways. We scoured the site ourselves and found several of these unique ads. We found no fewer than four ads of people looking to pay someone to cosign a loan for them. One young man can’t afford to finish paying for college because his parents lost their jobs. He needs access to student loans, but his credit scores aren’t high enough, so he turned to Craigslist and promised to pay anyone who’d be willing to co-sign $1,000 for their signature. Unfortunately, he says it looks as though the four responses are scams. They want him to pay the money up front or they’re asking for his bank information. This young man, if he’s unable to stay in school, will lose his visa and will be forced to return to Mexico. He only needs an $8,000 loan, but without it, he won’t be able to finish his final year of college.

Craigslist

As we plundered through the “Financial Services” section of Craigslist, we saw a lot of ads from people needing co signers for automobile loans, mortgages and even small business owners needing a bit of a financial push.

These ads aren’t illegal and we aren’t sure just how successful they are, but one thing is clear: all the months we’ve reported on the growing number of Americans who no longer have access to traditional financial products has come to this. Even as the media insists the economy is improving and even as headlines say consumer spending is up and defaults are down we now know those defaults are down because frankly, there aren’t anymore loans that can be put into default. They’re already in collection status. The economy is improving because of less than idea formulas used to calculate the numbers.

What are your thoughts? Would you be willing to co sign for a stranger? Would you be willing to post an ad like this on Craigslist if you needed a new car or a cosigner for a student loan? Share your thoughts with us.

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