The Wall Street Journal posted an article about an alternative method of debt collection. Debt collection companies are issuing credit cards to consumers whose debts have expired under state debt collection laws. As a condition for getting a fresh start on being a good credit citizen, recipients of the cards agree to pay a portion of the expired debt.
Sounds like a low cost alternative to the consumer filing for bankruptcy, assuming they can endure the calls and letters from debt collectors during the three to ten year period between the last debt payment and the statutory limit for collecting the debt. Yes, the card issuer should make it clear that part of the terms and conditions of getting the card is that part of the old debt must be repaid. If that transparency requirement is met, then the government should stay out of this market.
What do you think? Should government get involved in this trending market?