Rolling Jubilee

The amount these debts sell for is largely reliant on:

(a) The cost of labor required to collect on these loans. Being a debt collector is a shit job and makes you a sick person. Labor is probably figured heavily into the cost.

(b) The rents of capital employed in the endeavour.

Factor (a) takes into account the difficulty of collecting on the loan but also the fact that debt collecting probably pays above minimum wage due to the disagreeable nature of the work and high turnover rate of labor.

Factor (b) takes into account the fact that debt collecting is a business. No business is without large fixed costs like renting a building, utilities, electronics, cleaning staff, etc.

Lastly, let us not pretend that debt collectors do not profit because the market is perfectly efficient. That would be farcical. There is a last factor (c) and that is the average 'inefficiency' of the market embodied by profit after wages and rents. That, too, is represented in the cost.

I suspect that this will be a valiant and somewhat successful effort to actually make a difference. Reading Graeber's "Debt: the first 5000 years" really opened me up to the tendency of private debt:GDP to overwhelm aggregate demanding, causing high unemployment and a slow economy. Freeing ourself from this debt by these means is not optimal but it is probably the best option we have to somewhat salvage the sorry state of capitalism at this moment.