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Uncle Leo

Ethics and morals in debt

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If you charge $1000 in stuff and don't pay and manage to avoid everybody for a set perios of time, the law pretty much bars legal action against you in collecting said $1000. Most people would say the money is still owed.

 

How about if you charge $1000, and the creditor offers you a settlement... pay $500 and have $500 forgiven, or charged-off? Do you still morally owe the full $1000?

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I don't think so. Initially, yes, you morally owe the $1k. However, a settlement was agreed upon, so all parties do not feel slighted.

 

In that case, moral dilemma solved!

 

~Daizzy

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If they settle they are actually "forgiving" the part of the debt they agree to cease collection on.

 

However, if you cannot forgive yourself for that debt your peace of mind is worth more than $500, or even $500,000. Pay it when you can and feel good about yourself you can't take it with you anyway.

 

Just be forewarned of two things:

 

1) It's going to be hard to get the OC to take the payment, and legally impossible if they sold the debt.

 

2) You may/will "start the clock" all over on your CRs. Be sure to get an attorney involved in getting a letter of assurance that states the debt holder will agree to your terms as to reporting/not reporting etc.

 

It would be a harder road than avoiding the debt but money, as you know, is fleeting. Peace of mind and self-respect are worth far more in my book.

 

I am of the same ilk as you but until we get the money we must work on surviving the dilemma.

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My moral debt dilemma was the worst, I had flawless credit in my early 20's, my Mom decides to open a bunch of accounts in my name, run up charges, then never make a payment & default.

 

I found out like 6 months after they charged off. What do you do, pay them off or press charges against your Mom?

 

I ate the charges and paid everything off, it ruined my relationship with her though, that's for sure. I moved 1000 miles away, lol.

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But I think the argument is how much of the 1k is really what you charged? After interest late fees over the limit fees, it just adds up. I fight with the moral issue to because I feel I should pay what I owe. But im learning that these creditors make so much money off of consumers anyway if i can get a settlement what are they really losing? Whatever I spent is being paid for numerous times over either by me or someone else. If it was all fair and moral then us consumers can say well I cant manage this credit anymore can I just pay back what I spent? Nope cant do that still have to pay interest and suffer from bad credit that makes everything else cost more. We pay for the use of the credit not for what we actually use. I think its fair to say if we really sit down and figure out was was actually charged it would be closer to what you settle for anyway.

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I think morals have no business in a consumer finance issue.The creditors and collectors look at it from a business prospective point of view and I see no reason why we could not imitate them.

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I think morals have no business in a consumer finance issue.The creditors and collectors look at it from a business prospective point of view and I see no reason why we could not imitate them.

 

make that "why we should not" - they look at it as a business knowing we see it as morality. It makes it easy for them to collect.

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But I think the argument is how much of the 1k is really what you charged? After interest late fees over the limit fees, it just adds up. I fight with the moral issue to because I feel I should pay what I owe. But im learning that these creditors make so much money off of consumers anyway if i can get a settlement what are they really losing? Whatever I spent is being paid for numerous times over either by me or someone else. If it was all fair and moral then us consumers can say well I cant manage this credit anymore can I just pay back what I spent? Nope cant do that still have to pay interest and suffer from bad credit that makes everything else cost more. We pay for the use of the credit not for what we actually use. I think its fair to say if we really sit down and figure out was was actually charged it would be closer to what you settle for anyway.

 

I agree to a point. I have no problem with interest accruing but only at the rate when the card was active and in good standing. Just because I didn't pay doesn't mean that should stop. Gouging fees and interest, however, I would not feel morally obligated to pay.

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I think morals have no business in a consumer finance issue.The creditors and collectors look at it from a business prospective point of view and I see no reason why we could not imitate them.

 

Lowest common denominator?

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I think morals have no business in a consumer finance issue.The creditors and collectors look at it from a business prospective point of view and I see no reason why we could not imitate them.

 

Agreed.

 

I'm a big fan of personal responsibility, but the truth is that lenders and morals do not go in the same sentence. That doesn't mean it is OK to stick it to "the man" but when life deals you a curve you do what you have to do. If that means settling for less than your rightfully owe, so be it.

 

The only ones I despise are those who KNOWINGLY and PURPOSELY rack up those debts and don't pay.

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My moral debt dilemma was the worst, I had flawless credit in my early 20's, my Mom decides to open a bunch of accounts in my name, run up charges, then never make a payment & default.

 

I found out like 6 months after they charged off. What do you do, pay them off or press charges against your Mom?

 

I ate the charges and paid everything off, it ruined my relationship with her though, that's for sure. I moved 1000 miles away, lol.

 

 

I wouldnt have paid them. I would have let my mom go to prison before I let her get away with that......

 

Sounds harsh, but she should have had responsibility for what she chose to do.

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My moral debt dilemma was the worst, I had flawless credit in my early 20's, my Mom decides to open a bunch of accounts in my name, run up charges, then never make a payment & default.

 

I found out like 6 months after they charged off. What do you do, pay them off or press charges against your Mom?

 

I ate the charges and paid everything off, it ruined my relationship with her though, that's for sure. I moved 1000 miles away, lol.

I wouldnt have paid them. I would have let my mom go to prison before I let her get away with that......

 

Sounds harsh, but she should have had responsibility for what she chose to do.

 

Sounds great, but it's MY name... and resulting higher interest rates that I would have to pay... that is on the line. Sometimes you have to protect yourself as unfair as it is.

 

The way it was phrased, I'm presuming that the mother did this without approval from mdj2000.

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Also credit is a privledge not a right. So when you mess up you pay dearly for the mistake. But what happens when you mess up because like some one stated life throws you a curve? Job loss, sickness, divorce. creditors never say well you lost your job and you need to survive so well help you maintian. What do they say well your account has to become deliquent before we offer a hardship program. Based on that theory alone, settlements are fair and just in this credit game.

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I think the "moral" balance can be fixed by paying that

debt to somebody. For example, there's a church across

the street that has a poorbox ... legalities aside, you may

prefer not to profit from your good luck. Depends on how

you are wired inside, its a cultural thing.

 

Or, if the creditor is a "good guy" (library fines, etc.) and

you wiggle out of the debt, you can make an anonymous

contribution to that same place. If your life needs balance,

such actions can help restore that balance.

 

ER

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I think morals have no business in a consumer finance issue.The creditors and collectors look at it from a business prospective point of view and I see no reason why we could not imitate them.

 

Lowest common denominator?

 

 

I am unsure of your reply so I clarify by saying a lender has a business model that profits him regardless and I do not feel I have to pay anyone based just on morals or guilt factor.There are too many collectors playing these mind games like this. I feel a person has a responsibility in using their credit wisely and paying what is fair. I do not believe in rate jacks and aa's unless the lender has a very good reason for this besides profit.I have seen too many struggling extremely hard to stay ahead and find their self buried after a rate jack which would lead to bankruptcy in a good percentage of that profile of customers. Just a note I am not behind on anything I have.

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I think morals have no business in a consumer finance issue.The creditors and collectors look at it from a business prospective point of view and I see no reason why we could not imitate them.

Lowest common denominator?

I am unsure of your reply so I clarify by saying a lender has a business model that profits him regardless and I do not feel I have to pay anyone based just on morals or guilt factor.There are too many collectors playing these mind games like this. I feel a person has a responsibility in using their credit wisely and paying what is fair. I do not believe in rate jacks and aa's unless the lender has a very good reason for this besides profit.I have seen too many struggling extremely hard to stay ahead and find their self buried after a rate jack which would lead to bankruptcy in a good percentage of that profile of customers. Just a note I am not behind on anything I have.

 

I agree with you about rate-jacks, game playing, etc. Many times all that does is make the situation worse (even for the creditor, I would think) and push people over the edge whereas they might have been able to stay afloat and eventually pay it off if things were simply left alone.

 

Your original statement seemed to say that "they have no morals, so I am justified in not having any".

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It's not about morality, really, it's about you working for them, and them working for you...

 

It's a business, folks.

 

On their side, you as the consumer pose a risk of default, so they charge an annual interest rate which both offsets the statistical amount of risk you represent and also provides them with a healthy profit margin.

 

On your side, they as an issuing bank provide a service which makes your life more convenient, and so you're willing to allow them their profit in exchange for that service.

 

It's just that simple.

Edited by chriswufgator

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Morality is part of every human interaction whether or not you want to admit it. Corporations are ultimately made up of humans. Many of whom choose to conduct themselves immoraly from someone's perspective. Individuals too, decide to operate with a code of moral ethics. Sometimes we violate our own moral codes and sometimes individuals and corporatins alike operate with strictly immoral intent but do not ever live under the illusion that morality can be removed from any field of human endeavor.

"If you choose not to decide you still have made a choice" Niel Peart - Rush

We can all pretend that morality is not invloved in business but morality the single most important element in business because it embodies the ability to trust, and without trust their is chaos and anarchy.

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Morality is part of every human interaction whether or not you want to admit it. Corporations are ultimately made up of humans. Many of whom choose to conduct themselves immoraly from someone's perspective. Individuals too, decide to operate with a code of moral ethics. Sometimes we violate our own moral codes and sometimes individuals and corporatins alike operate with strictly immoral intent but do not ever live under the illusion that morality can be removed from any field of human endeavor.

"If you choose not to decide you still have made a choice" Niel Peart - Rush

We can all pretend that morality is not invloved in business but morality the single most important element in business because it embodies the ability to trust, and without trust their is chaos and anarchy.

 

I disagree wholeheartedly.

 

You need to wake up and take a peek at the 21st century.

 

A double-standard has been created.

 

Consumers are expected to act ethically, yet corporations categorically reject that obligation.

 

If you doubt this, read any thread on this board going back 5 years about a CA, any of the MBNA threads about cardholders' conversations with CSRs and underwriters, or any of the F/R threads of late. Corporate America clearly expects to be able to rely on Consumers, while themselves acting inherently unreliably.

 

It's purely business, and no....business does not revolve around morality. Business revolves around what is mutually beneficial for two or more parties.

 

You want to borrow money, and they want to make a profit.

 

That's really all there is to it.

Edited by chriswufgator

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If you charge $1000 in stuff and don't pay and manage to avoid everybody for a set perios of time, the law pretty much bars legal action against you in collecting said $1000. Most people would say the money is still owed.

 

How about if you charge $1000, and the creditor offers you a settlement... pay $500 and have $500 forgiven, or charged-off? Do you still morally owe the full $1000?

 

 

All is fair in love and war and all is fair in whats legal in credit.

 

They have no morals or ethics for collections when someone gets in a bad spot.

 

If you have the money and/or desire to pay then pay. If not, use the system to your advantage. Don;t worry, if the creditors can ue it to their advantage - they will.

 

I found some peace of mind in paying my old debts(almost all of them). But I was able to and I am certain most of my troubles were my fault (and all in all not that huge a sum of money that it would wreck my life to pay it off)- not cancer or a horrible accident or divorce or health problems of my children.

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I think morals have no business in a consumer finance issue.The creditors and collectors look at it from a business prospective point of view and I see no reason why we could not imitate them.

 

Lowest common denominator?

I am curious as to why you consider "business ethics" as a "lowest common denominator".

 

Most people wouldn't expect to apply their personal religious moral judgments to a decision on say, choosing a new car, or use personal ethical/moral criteria in evaluating whether or not you are going to choose to obey the traffic laws.

 

We all have our own personal religious ethical and moral standards, and we all follow them when appropriate. Those who try to impose THEIR moral/ethical ideas on others who do not agree with them are the ones who are, IMO immoral and unethical.

 

Business ethics are the common denominator in consumer credit transactions,and business ethics state that when a bill is no longer LEGALLY owed, it is NOT "morally" owed either.

 

This is the very basis of our modern Society, all debts are "forgiven" after a period of time, or discharged in Bankruptcy,or voided by death.

 

Unless you wish to go back in time to the days of debtors prisons and having a family pay on an inherited debt for generations, you should rethink your basic assumptions about "morality" in business transactions.

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