lots of them are probably just people who ran into problems, and something like this would help clear up their credit and give them a new start.
Unfortunately, once your account is in collections, your credit rating is damaged and paying the debt off doesn't improve it much. While that's arguably "fair" (the original creditor still got screwed, losing 60-95 cents on the dollar) it leaves the debtor with minimal reason to pay the debt, unless successfully sued, resulting in a judgment. As the OP discusses, most third-party collectors have lost proof of the debt and won't be able to successfully sue the debtor. Full recovery of the credit rating would be sufficient incentive for many people to repay, but that's not an option.
The fact that you can't get your credit rating back (at least, not to what it was) is one of the problems with the system as it stands currently. If there was a system whereby people could make the original creditor whole and recover their credit rating, that'd probably better (if shitty for third-party collectors).
Ya, I'm sure you are correct. It was a bit of a flippant idea. But... it would still remove _some of the stain from their credit and at least prevent them being victimized by scummy collectors like those referenced in the article.
Unfortunately, once your account is in collections, your credit rating is damaged and paying the debt off doesn't improve it much. While that's arguably "fair" (the original creditor still got screwed, losing 60-95 cents on the dollar) it leaves the debtor with minimal reason to pay the debt, unless successfully sued, resulting in a judgment. As the OP discusses, most third-party collectors have lost proof of the debt and won't be able to successfully sue the debtor. Full recovery of the credit rating would be sufficient incentive for many people to repay, but that's not an option.
The fact that you can't get your credit rating back (at least, not to what it was) is one of the problems with the system as it stands currently. If there was a system whereby people could make the original creditor whole and recover their credit rating, that'd probably better (if shitty for third-party collectors).