Loans/debt companies

[becks]

If you take out a loan with a bank then tell them you can't pay it back and a debt company "buys" the debt from the bank, is it true that you'll only pay off a percentage of the original debt and they wipe off the rest after a certain number of years? Does that even make sense? Eg i borrow ten grand from barclays, tell them i can't pay it back, debt company buys debt for two grand and i pay back the two grand (thus being eight grand up)?? Is this true?

[OBonio]

I believe the debt company buy the debt for 2k, and then they'll chase you for the 10k.

[becks]

But why would the bank bother doing that - surely if the debt compnay is going to get the ten grand - what's the point of selling the debt when the bank could get it back. I don't get it...

[WoWo]

because its a whole lot of hassle chasing debts. Banks are far to busy counting money etc to chase you for the money but a debt company will have the systems in place to get the money back. A few things to remember 1. The Bank are unlikely to give moeny out in the first place with out some assurances, 2. not paying back loans will result in a bad credit history and in worst case bankruptcy, neither or which will do you any favours.

[becks]

Oh ok, don't worry i wasn't planning to do it or anything i like my good credit rating just heard something i wasn't sure about, crystal now though, thanks guys.