The group is able to buy debt so cheaply due to the nature of the - TopicsExpress

The group is able to buy debt so cheaply due to the nature of the secondary debt market. If individuals consistently fail to pay bills from credit cards, loans, or medical insurance the bank or lender that issued the funds will eventually cut its losses by selling that debt to a third party. These sales occur for a fraction of the debt’s true values – typically for five cents on the dollar – and debt-buying companies then attempt to recoup the debt from the individual debtor and thus make a profit.

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