I’m 60k in debt and don’t like the idea of paying for 20+ years.
What are your thoughts on people in debt pooling money together and paying off loans in full?
Example, 1 million people agree to help each other. Each person pays a one-time payment of 150 then continues to pay 50 a month. So a lump of 150 million with 50 million coming every month.
Every person that paid the 150 and 50/month get a random number generated for them, 1 through 1 million. Money pays off each loan of the people involved until the million people are debt-free.
So number 1 still pays 50 a month till the millionth person gets out of debt.
My initial reaction is it sounds like a scheme doomed to fail. Kind of a hint of a lottery or Ponzi scheme feel. I know that’s probably not your intention, that’s just how it makes me feel.
Depending on the debt load of people participating it could take a long time before all the debt gets repaid.
It seems like a $1,900 Chapter 7 Bankruptcy filing where the debt is eliminated in less than 90 days or so is a faster way to deal with unaffordable debt.
From a practical point of view, I can’t even begin to forecast how much it would administratively cost to manage the plan or the costs of compliance, bonding, and/or licensing in all the states that would require that.
I’m not trying to rain on your idea, just be practical based on my experience in the debt world since 1994.
A universal truth is that no good deed goes unpunished so I would expect stiff headwinds if this started to gain momentum.
But then again, what the hell do I know?
I do know that you should not call it debt pooling. Has a bad history.
If you do decide to launch such a program, I would love for you to keepme posted on progress by posting comments below.
I wish you tons of luck in this effort.