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Debt Assignment: How They Work, Considerations and Benefits

Daniel Liberto is a journalist with over 10 years of experience working with publications such as the Financial Times, The Independent, and Investors Chronicle.

Charlene Rhinehart is a CPA , CFE, chair of an Illinois CPA Society committee, and has a degree in accounting and finance from DePaul University.

Katrina Ávila Munichiello is an experienced editor, writer, fact-checker, and proofreader with more than fourteen years of experience working with print and online publications.

Investopedia / Ryan Oakley

What Is Debt Assignment?

The term debt assignment refers to a transfer of debt, and all the associated rights and obligations, from a creditor to a third party. The assignment is a legal transfer to the other party, who then becomes the owner of the debt . In most cases, a debt assignment is issued to a debt collector who then assumes responsibility to collect the debt.

Key Takeaways

Debt assignment is a transfer of debt, and all the associated rights and obligations, from a creditor to a third party (often a debt collector).
The company assigning the debt may do so to improve its liquidity and/or to reduce its risk exposure.
The debtor must be notified when a debt is assigned so they know who to make payments to and where to send them.
Third-party debt collectors are subject to the Fair Debt Collection Practices Act (FDCPA), a federal law overseen by the Federal Trade Commission (FTC).

How Debt Assignments Work

When a creditor lends an individual or business money, it does so with the confidence that the capital it lends out—as well as the interest payments charged for the privilege—is repaid in a timely fashion. The lender , or the extender of credit , will wait to recoup all the money owed according to the conditions and timeframe laid out in the contract.

In certain circumstances, the lender may decide it no longer wants to be responsible for servicing the loan and opt to sell the debt to a third party instead. Should that happen, a Notice of Assignment (NOA) is sent out to the debtor , the recipient of the loan, informing them that somebody else is now responsible for collecting any outstanding amount. This is referred to as a debt assignment.

The debtor must be notified when a debt is assigned to a third party so that they know who to make payments to and where to send them. If the debtor sends payments to the old creditor after the debt has been assigned, it is likely that the payments will not be accepted. This could cause the debtor to unintentionally default.

When a debtor receives such a notice, it's also generally a good idea for them to verify that the new creditor has recorded the correct total balance and monthly payment for the debt owed. In some cases, the new owner of the debt might even want to propose changes to the original terms of the loan. Should this path be pursued, the creditor is obligated to immediately notify the debtor and give them adequate time to respond.

The debtor still maintains the same legal rights and protections held with the original creditor after a debt assignment.

Special Considerations

Third-party debt collectors are subject to the Fair Debt Collection Practices Act (FDCPA). The FDCPA, a federal law overseen by the Federal Trade Commission (FTC), restricts the means and methods by which third-party debt collectors can contact debtors, the time of day they can make contact, and the number of times they are allowed to call debtors.

If the FDCPA is violated, a debtor may be able to file suit against the debt collection company and the individual debt collector for damages and attorney fees within one year. The terms of the FDCPA are available for review on the FTC's website .

Benefits of Debt Assignment

There are several reasons why a creditor may decide to assign its debt to someone else. This option is often exercised to improve liquidity and/or to reduce risk exposure. A lender may be urgently in need of a quick injection of capital. Alternatively, it might have accumulated lots of high-risk loans and be wary that many of them could default . In cases like these, creditors may be willing to get rid of them swiftly for pennies on the dollar if it means improving their financial outlook and appeasing worried investors. At other times, the creditor may decide the debt is too old to waste its resources on collections, or selling or assigning it to a third party to pick up the collection activity. In these instances, a company would not assign their debt to a third party.

Criticism of Debt Assignment

The process of assigning debt has drawn a fair bit of criticism, especially over the past few decades. Debt buyers have been accused of engaging in all kinds of unethical practices to get paid, including issuing threats and regularly harassing debtors. In some cases, they have also been charged with chasing up debts that have already been settled.

Federal Trade Commission. " Fair Debt Collection Practices Act ." Accessed June 29, 2021.

Federal Trade Commission. " Debt Collection FAQs ." Accessed June 29, 2021.

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Public Debt: Meaning, Classification and Method of Redemption

Public Debt: Meaning, Classification and Method of Redemption!

Meaning of Public Debt:

Modern governments need to borrow from different sources when current revenue falls short of public expenditures. Thus, public debt refers to loans incurred by the government to finance its activities when other sources of public income fail to meet the requirements. In this wider sense, the proceeds of such public borrowing constitute public income.

However, since debt has to be repaid along with interest from whom it is borrowed, it does not constitute income. Rather, it constitutes public expenditure. Public debt is incurred when the government floats loans and borrows either internally or externally from banks, individuals or countries or international loan-giving institutions.

What is true about public borrowing is that, like taxes, public borrowing is not a compulsory source of public income. The word ‘compulsion’ is not applied to public borrowing except in certain exceptional cases of borrowing.

Classification of Public Debt :

ADVERTISEMENTS:

The structure of public debt is not uniform in any country on account of factors such as categories of markets in which loans are floated, the conditions for repayment, the rate of interest offered on bonds, purposes of borrowing, etc.

In view of these differences in criteria, public debt is classified into various categories:

i. Internal and external debt

ii. Short term and long term loans

iii. Funded and unfunded debt

iv. Voluntary and compulsory loans

v. Redeemable and irredeemable debt

vi. Productive or reproductive and unproductive debt/deadweight debt

i. Internal and External Debt:

Sums owed to the citizens and institutions are called internal debt and sums owed to foreigners comprise the external debt. Internal debt refers to the government loans floated in the capital markets within the country. Such debt is subscribed by individuals and institutions of the country.

On the other hand, if a public loan is floated in the foreign capital markets, i.e., outside the country, by the government from foreign nationals, foreign governments, international financial institutions, it is called external debt.

ii. Short term and Long Term Loans:

Loans are classified according to the duration of loans taken. Most government debt is held in short term interest-bearing securities, such as Treasury Bills or Ways and Means Advances (WMA). Maturity period of Treasury bill is usually 90 days.

Government borrows money for such period from the central bank of the country to cover temporary deficits in the budget. Only for long term loans, government comes to the public. For development purposes, long period loans are raised by the government usually for a period exceeding five years or more.

iii. Funded and Unfunded or Floating Debt:

Funded debt is the loan repayable after a long period of time, usually more than a year. Thus, funded debt is long term debt. Further, since for the repayment of such debt government maintains a separate fund, the debt is called funded debt. Floating or unfunded loans are those which are repayable within a short period, usually less than a year.

It is unfunded because no separate fund is maintained by the government for the debt repayment. Since repayment of unfunded debt is made out of public revenue, it is referred to as a floating debt. Thus, unfunded debt is a short term debt.

iv. Voluntary and Compulsory Loans:

A democratic government raises loans for the nationals on a voluntary basis. Thus, loans given to the government by the people on their own will and ability are called voluntary loans. Normally, public debt, by nature, is voluntary. But during emergencies (e.g., war, natural calamities, etc.,) government may force the nationals to lend it. Such loans are called forced or compulsory loans.

v. Redeemable and Irredeemable Debt:

Redeemable public debt refers to that debt which the government promises to pay off at some future date. After the maturity period, the government pays the amount to the lenders. Thus, redeemable loans are called terminable loans.

In the case of irredeemable debt, government does not make any promise about the payment of the principal amount, although interest is paid regularly to the lenders. For the most obvious reasons, redeemable public debt is preferred. If irredeemable loans are taken by the government, the society will have to face the consequence of burden of perpetual debt.

vi. Productive (or Reproductive) and Unproductive (or Deadweight) Debt:

On the criteria of purposes of loans, public debt may be classified as productive or reproductive and unproductive or deadweight debt. Public debt is productive when it is used in income-earning enterprises. Or productive debt refers to that loan which is raised by the government for increasing the productive power of the economy.

A productive debt creates sufficient assets by which it is eventually repaid. If loans taken by the government are spent on the building of railways, development of mines and industries, irrigation works, education, etc., income of the government will increase ultimately.

Productive loans thus add to the total productive capacity of the country.

In the words of Findlay Shirras: “Productive or reproductive loans which are fully covered by assets of equal or greater value, the source of the interest is the income from the ownership of these as railways and irrigation works.”

Public debt is unproductive when it is spent on purposes which do not yield any income to the government, e.g., refugee rehabilitation or famine relief work. Loans for financing war may be regarded as unproductive loans. Instead of creating any productive assets in the economy, unproductive loans do not add to the productive capacity of the economy. That is why unproductive debts are called deadweight debts.

Methods of Redemption of Public Debt :

Redemption of debt refers to the repayment of a public loan. Although public debt should be paid, debt redemption is desirable too. In order to save the government from bankruptcy and to raise the confidence of lenders, the government has to redeem its debts from time to time.

Sometimes, the government may resort to an extreme step, such as repudiation of debt. This extreme step is, of course, violation of the contract. Use of repudiation of debt by the government is economically unsound.

Here, instead of concentrating on the repudiation of debt, we discuss below other important methods for the retirement or redemption of public debt:

i. Refunding:

Refunding of debt implies issue of new bonds and securities for raising new loans in order to pay off the matured loans (i.e., old debts).

When the government uses this method of refunding, there is no liquidation of the money burden of public debt. Instead, the debt servicing (i.e., repayment of the interest along with the principal) burden gets accumulated on account of postponement of the debt- repayment to save future debt.

ii. Conversion:

By debt conversion we mean reduction of interest burden by converting old but high interest-bearing loans into new but low interest-bearing loans. This method tends to reduce the burden of interest on the taxpayers. As the government is enabled to reduce the burden of debt which falls, it is not required to raise huge revenue through taxes to service the debt.

Instead, the government can cut down the tax liability and provide relief to the taxpayers in the event of a reduction in the rate of interest payable on public debt. It is assumed that since most taxpayers are poor people while lenders are rich people, such conversion of public debt results in a less unequal distribution of income.

iii. Sinking Fund:

One of the best methods of redemption of public debt is sinking fund. It is the fund into which certain portion of revenue is put every year in such a way that it would be sufficient to pay off the debt from the fund at the time of maturity. In general, there are, in fact, two ways of crediting a portion of revenue to this fund.

The usual procedure is to deposit a certain (fixed) percentage of its annual income to the fund. Another procedure is to raise a new loan and credit the proceeds to the sinking fund. However, there are some reservations against the second method.

Dalton has opined that it is in the Tightness of things to accumulate sinking fund out of the current revenue of the government, not out of new loans. Although convenient, it is one of the slowest methods of redemption of debt. That is why capital levy as a form of debt repudiation is often recommended by economists.

iv. Capital Levy:

In times of war or emergencies, most governments follow the practice of raising money necessary for the redemption of the public debt by imposing a special tax on capital.

A capital levy is just like a wealth tax in as much as it is imposed on capital assets. This method has certain decisive advantages. Firstly, it enables a government to repay its (emergency) debt by collecting additional tax revenues from the rich people (i.e., people who have huge properties).

This then reduces consumption spending of these people and the severity of inflation is weakened. Secondly, progressive levy on capital helps to reduce inequalities in income and wealth. But it has certain clear-cut disadvantages too. Firstly, it hampers capital formation. Secondly, during normal time this method is not suggested.

v. Terminal Annuity:

It is something similar to sinking fund. Under this method, the government pays off its debt on the basis of terminal annuity. By using this method, the government pays off the debt in equal annual instalments.

This method enables government to reduce the burden of debt annually and at the time of maturity it is fully paid off. It is the method of redeeming debts in instalments since the government is not required to make one huge lump sum payment.

vi. Budget Surplus:

By making a surplus budget, the government can pay off its debt to the people. As a general rule, the government makes use of the budgetary surplus to buy back from the market its own bonds and securities. This method is of little use since modern governments resort to deficit budget. A surplus budget is usually not made.

vii. Additional Taxation:

Sometimes, the government imposes additional taxes on people to pay interest on public debt. By levying new taxes—both direct and indirect— the government can collect the necessary revenue so as to be able to pay off its old debt. Although an easier means of repudiation, this method has certain advantages since taxes have large distortionary effects.

viii. Compulsory Reduction in the Rate of Interest:

The government may pass an ordinance to reduce the rate of interest payable on its debt. This happens when the government suffers from financial crisis and when there is a huge deficit in its budget.

There are so many instances of such statutory reductions in the rate of interest. However, such practice is not followed under normal situations. Instead, the government is forced to adopt this method of debt repayment when situation so demands.

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Sovereign debt management is the process of establishing and executing a strategy for managing the government’s debt in order to raise the required amount of funding, achieve its risk and cost objectives, and to meet any other sovereign debt management goals the government may have set, such as developing and maintaining an efficient market for government securities.

In a broader macroeconomic context for public policy, governments should seek to ensure that both the level and rate of growth in their public debt is fundamentally sustainable, and can be serviced under a wide range of circumstances while meeting cost and risk objectives. Sovereign debt managers share fiscal and monetary policy advisors’ concerns that public sector indebtedness remains on a sustainable path and that a credible strategy is in place to reduce excessive levels of debt. Debt managers should ensure that the fiscal authorities are aware of the impact of government financing requirements and debt levels on borrowing costs. 2 Examples of indicators that address the issue of debt sustainability include the public sector debt service ratio, and ratios of public debt to GDP and to tax revenue.

Poorly structured debt in terms of maturity, currency, or interest rate composition and large and unfunded contingent liabilities have been important factors in inducing or propagating economic crises in many countries throughout history. For example, irrespective of the exchange rate regime, or whether domestic or foreign currency debt is involved, crises have often arisen because of an excessive focus by governments on possible cost savings associated with large volumes of short-term or floating rate debt. This has left government budgets seriously exposed to changing financial market conditions, including changes in the country’s creditworthiness, when this debt has to be rolled over. Foreign currency debt also poses particular risks, and excessive reliance on foreign currency debt can lead to exchange rate and/or monetary pressures if investors become reluctant to refinance the government’s foreign currency debt. By reducing the risk that the government’s own portfolio management will become a source of instability for the private sector, prudent government debt management, along with sound policies for managing contingent liabilities, can make countries less susceptible to contagion and financial risk.

A government’s debt portfolio is usually the largest financial portfolio in the country. It often contains complex and risky financial structures, and can generate substantial risk to the government’s balance sheet and to the country’s financial stability. As noted by the Financial Stability Forum’s Working Group on Capital Flows, “recent experience has highlighted the need for governments to limit the build up of liquidity exposures and other risks that make their economies especially vulnerable to external shocks.” 3 Therefore, sound risk management by the public sector is also essential for risk management by other sectors of the economy “because individual entities within the private sector typically are faced with enormous problems when inadequate sovereign risk management generates vulnerability to a liquidity crisis.” Sound debt structures help governments reduce their exposure to interest rate, currency and other risks. Many governments seek to support these structures by establishing, where feasible, portfolio benchmarks related to the desired currency composition, duration, and maturity structure of the debt to guide the future composition of the portfolio.

Several debt market crises have highlighted the importance of sound debt management practices and the need for an efficient and sound capital market. Although government debt management policies may not have been the sole or even the main cause of these crises, the maturity structure, and interest rate and currency composition of the government’s debt portfolio, together with substantial obligations in respect of contingent liabilities have often contributed to the severity of the crisis. Even in situations where there are sound macroeconomic policy settings, risky debt management practices increase the vulnerability of the economy to economic and financial shocks. Sometimes these risks can be readily addressed by relatively straightforward measures, such as by lengthening the maturities of borrowings and paying the associated higher debt servicing costs (assuming an upward sloping yield curve), by adjusting the amount, maturity, and composition of foreign exchange reserves, and by reviewing criteria and governance arrangements in respect of contingent liabilities.

Risky debt structures are often the consequence of inappropriate economic policies—fiscal, monetary and exchange rate—but the feedback effects undoubtedly go in both directions. There are limits, however, to what sound debt management policies can deliver. Sound debt management policies are no panacea or substitute for sound fiscal and monetary management. If macroeconomic policy settings are poor, sound sovereign debt management may not by itself prevent any crisis. Sound debt management policies reduce susceptibility to contagion and financial risk by playing a catalytic role for broader financial market development and financial deepening. Experience supports the argument, for example, that developed domestic debt markets can substitute for bank financing (and vice versa) when this source dries up, helping economies to weather financial shocks. 4

Within Same Series

2. What is Public Debt Management and Why is it Important?
I Implementing the Guidelines in Practice
1 Introduction
Chapter 3 A Government Debt Issuance Strategy and Debt Management Framework
3. The Public Debt Management Guidelines
15. External Debt Analysis: Further Considerations
III Summary of the Debt Management Guidelines
PART III Use of External Debt Statistics
Appendix Summary of the Debt Management Guidelines1
IV Discussion of the Guidelines

Inter-American Development Bank

The Unexplained Part of Public Debt
Debt Management in Latin America: How Safe Is the New Debt Composition?
Debt Management: Some Reflections Based on Argentina
Ecuador: Creating Fiscal Space for Poverty Reduction; A Fiscal Management and Public Expenditure Review. Volume I
Fiscal Policy Issues in Jamaica: Budgetary Institutions, the Tax System and Public Debt Management
Innovation for Better Management: The Contribution of Public Innovation Labs
Public Debt and Social Expenditure: Friends or Foes?
Why Do Lazy People Make More Money?: The Strange Case of the Public Sector Wage Premium
Government Capabilities in Latin America: Why They Are So Important, What We Know about Them, and What to Do Next
Public Financial Management in Latin America: The Key to Efficiency and Transparency

The World Bank

Institutional Arrangements for Public Debt Management
Small States - Performance in Public Debt Management
Public Debt Management in Emerging Market Economies: Has This Time Been Different ?
Clientelism in the Public Sector: Why Public Service Reforms May Not Succeed and What to Do About It.
A cross-country analysis of public debt management strategies
Clientelism in the Public Sector: Why Public Service Reforms Fail and What to Do about It
Greco-Roman lessons for public debt management and debt market development
Coordinating Public Debt Management With Fiscal and Monetary Policies: An Analytical Framework
Sudan Debt Management Performance Assessment
What Factors Predict How Public Sector Projects Perform?: A Review of the World Bank's Public Sector Management Portfolio

Cover Guidelines for Public Debt Management

Front Matter
I What Is Public Debt Management and Why Is It Important?
II Purpose of the Guidelines
Back Matter

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Public debt

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CORE Insights Public debt: threat or opportunity?

The authors of this Insight are: Barry Eichengreen: University of California, Berkeley. Ugo Panizza: Graduate Institute of International and Development Studies. 28 April 2022

For hundreds of years, governments have issued debt to finance their expenditure as a substitute for raising taxes, especially during challenging times.
Public debt in the U.S. has been increasing over the past four decades. Political polarization of parties has been offered as a potential explanation.
We can understand the dynamics of debt by looking at four variables: primary deficit, real interest rate, growth rate, and the stock of debt in the previous period.
Public debt can be repaid by running a primary surplus, or by promoting economic growth. However, in some circumstances, governments also have an incentive to use inflation to reduce debt.
State sovereignty limits the extent to which governments can be sued if they default on their debt, especially internationally.
Default may have negative consequences in terms of reputation and access to debt on favorable terms in the future.
Statutes and non-partisan institutions known as autonomous fiscal councils have been implemented in many countries to keep the government accountable for its use of debt.

CORE Insights Concepts in this Insight are related to material in: Unit 10 and Unit 14 of The Economy . Unit 9 of Economy, Society, and Public Policy . Recommended reading before starting this Insight: Section 14.8 of The Economy for an overview of the government’s finances.

1 Introduction

COVID-19 was designated as a pandemic in March of 2020 and recognized by governments as an all-hands-on-deck emergency. They responded by ramping up health spending, commissioning vaccine research, extending subsidies to employers seeking to meet payroll, and providing relief payments to households. They did this despite the fact that tax revenues were in sharp decline with businesses closed and residents locked down.

How did governments accomplish this feat? Answer: they did so by borrowing. When governments spend more than they raise in taxes, they finance the difference by selling bonds to the public. Investors purchase those bonds with cash, which the government then uses to extend payroll subsidies, make relief payments, and finance other spending. Worldwide, on average, governments borrowed 10.2% of GDP in 2020 and an additional 7.9% of GDP in 2021. As they borrowed they became more heavily indebted. General government debt as a share of global GDP rose from 83.6% in 2019, on the eve of the pandemic, to an estimated 97.8% in 2021. 1 The extent of borrowing and increase in debt were unprecedented in peacetime. We would need to go back to the Second World War—an all-hands-on-deck emergency if there ever was one—to see anything similar.

Few begrudge this borrowing. Governments that do not meet this kind of crisis by mobilizing additional resources, including those that can only be mobilized by incurring debt, face losing their legitimacy and public support. But now there is a financial legacy. There is a bill coming due. How should we think about this? When governments issue debt, they commit to paying interest to the bondholders and to buying back or replacing bonds when they mature. The spending happens today, benefiting the currently living, but interest and principal payments continue for as long as the bonds remain in circulation, potentially burdening successive generations. Thomas Jefferson, the third U.S. president, warned that ‘the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.’ 2 Future generations must pay taxes to finance the state’s interest payments, leaving them less disposable income with which to put food on the table and invest in commercial and industrial ventures. Writing shortly before Jefferson, Adam Smith, in The Wealth of Nations , warned that these ‘enormous debts presently oppress, and will in the long run probably ruin, all the great nations of Europe.’ 3

Smith and Jefferson are eminent figures, but not everyone shares their pessimistic assessment. Governments borrow for good reasons. They borrow to invest in roads, bridges, and broadband, and in so doing enhance the growth of the economy. They borrow to invest in early childhood education and technical training that make for a more productive labor force. Borrowing to finance these productive public investments bequeaths more debt and thus obliges households, now or in the future, to pay more taxes. But it also aims to deliver more robust growth and higher incomes, both topping up the government’s coffers and leaving those households better off even after paying taxes. In addition, governments, by borrowing, are able to boost public spending in periods when private spending is weak. They are able to engage in countercyclical fiscal policy, in other words, smoothing economic fluctuations.

To read a book-length discussion of these issues, see In Defense of Public Debt by Barry Eichengreen, Asmaa El-Ganainy, Rui Esteves, and Kris James Mitchener, or Sovereign Debt: A Guide for Economists and Practitioners by S. Ali Abbas, Alex Pienkowski, and Kenneth Rogoff. To read recent surveys that focus on debt crises in high-income and emerging economies, see ‘Sovereign Debt in the 21st Century: Looking Backward, Looking Forward’ by Kris James Mitchener and Christoph Trebesch, or ‘Enough Potential Repudiation: Economic and Legal Aspects of Sovereign Debt in the Pandemic Era’ by Anna Gelpern and Ugo Panizza.

In the Insight, we shall see that public debt is both a threat and an opportunity. It depends what it is used for and the circumstances in which it is taken on. The view from history tells us how and why governments have borrowed. Economic reasoning shows that the relationship between the economy’s growth rate and the interest rate explains the dynamics of the debt and enables us to understand the sustainability of the debt. From a political standpoint, we want to understand why governments repay what they borrow, in light of the fact that, as sovereign states, they are mostly immune from litigation in the courts. And we want to understand what happens when they choose otherwise.

2 Concepts and distinctions

Debt vs deficit

Debts and deficits are not the same. Government debt is a stock that measures the total amount of money owed by the government at a point in time. For example, the debt of France at the end of 2020 was €2.65 trillion. The budget deficit is a flow . It measures the difference between government expenditure and revenues over a period of time; when expenditure exceeds revenues, it is a deficit and in the opposite case, it is a surplus. (For more details on the government’s finances, see Section 14.8 of The Economy .) For example, the budget deficit of the French government during 2020 was €212 billion. These two variables are related, because the difference between the stock at the end of this year and the stock at the end of last year should equal the deficit during the year.

Debt-to-GDP ratio

In analyzing public debt, it is useful to scale that debt by GDP . To learn more about how GDP is calculated, see Unit 13 of The Economy . The same nominal amount of debt will be less burdensome for a larger economy, and economies grow over time. Whereas U.S. public debt stood at $233 billion in 1949, it was $5.6 trillion in 1999. At first glance, this 25-fold increase might look worrisome. But it appears very different when one observes that U.S. GDP grew from $270 billion to nearly $10 trillion, a 37-fold increase, over the period. The debt-to-GDP ratio fell from 86% to 56%. The debt-to-GDP ratio is also convenient for international comparisons. For instance, a debt of $88 billion (170% of GDP) brought the Lebanese government to the brink of insolvency in 2020. But $88 billion of debt would have been mere rounding error for a country like Germany, with a GDP of nearly $4 trillion.

Some authors suggest adjusting interest payments for the erosion of debt by inflation, replacing [(Debt + (Interest rate × Debt)) ÷ GDP] by [(Debt + ((Interest rate − inflation rate) × Debt)) ÷ GDP], where Debt is nominal public debt.

The debt-to-GDP ratio is the most widely used metric of public debt, because it is useful for analyzing the factors influencing the evolution of the debt burden over time (as we show starting in Section 5). But it is not the only possible way of scaling the debt. Alternatively, one can compare interest payments with GDP. This measure focuses on the current financing situation. It has the advantage that we are comparing a flow (interest payments this year) with another flow (GDP this year). Its corresponding disadvantage is that interest payments and GDP this year tell us nothing about the likely future evolution of the debt burden going forward.

In addition, it is important to note that the share of taxes in GDP varies substantially across countries. According to the International Monetary Fund (IMF) , in 2021, tax revenues were 14% of GDP in Uganda, for example, but 52% in France. (The average for high-income economies was 42%, while the average for emerging and developing economies was 27%.) Typically, government revenues are dominated by tax receipts. However, some governments such as those of Norway and Saudi Arabia also derive large revenues from the extraction and sale of natural resources. If debt is serviced from government revenues, then these large differences suggest that the typical high-income economy can sustain a higher debt-to-GDP ratio than the typical emerging economy. For some purposes, therefore, debt relative to government revenues can be a more useful metric.

Different ways to classify debt

For a brief explanation of the diabolic loop, see Section 6.1 of ‘ A crash course on the euro crisis ’ by Markus K. Brunnermeier and Ricardo Reis.

For some purposes it is important to disaggregate public debt according to who holds it. Debt securities issued by the government can be purchased by individual investors, mutual funds, pension funds and banks. Accumulation of large amounts of government bonds by banks in particular can create macroeconomic risks, since any problems of servicing the government’s debt will then become problems for the banks and, equally, any problems for the banks that force them to liquidate their holdings of government bonds can become problems for the government. In Europe, where these linkages were prominent starting in 2008, they became known as ‘the diabolic loop’ .

For other purposes it is important to distinguish whether debt is denominated in domestic or foreign currency, whether its term to maturity is long or short, and whether the interest rate is indexed to inflation . (For more about inflation, see Section 15.1 of The Economy .) When debt is denominated and issued in a foreign currency, as foreign investors have historically required of most governments, changes in the exchange rate can have implications for its sustainability. When debt is short in term, there will be little scope for using inflation to reduce its real value, since as soon as their debt securities mature, investors will be able to demand a higher interest rate in compensation for inflation, limiting any erosion in the real value of their investments. Thus, the maturity of the debt may influence a government’s policy choices. When the interest rate is indexed to inflation, there will be absolutely no scope for inflating away the debt. But there can be unanticipated consequences for debt-servicing costs. If the government, unlike investors, is confident that there will be no inflation, indexed debt can be cheaper than debt with a fixed interest rate. However, if inflation turns out to be higher than expected by investors, indexed debt will end up being more expensive for the government.

A further complication is the existence of different levels of government. One could focus on debt issued by the central government alone, or on general government debt, including that of state and municipal governments. The difference between central and general government debt can be substantial in federal countries. In 2020, when the central government debt of Switzerland was 21% of GDP , general government debt was 42% of GDP (the average debt of cantons, the 26 states of the Swiss Confederacy, was 12% of GDP and municipal debt 9% of GDP). Although statistics on general government debt are more encompassing, some countries do not keep good track of local government debt. Hence general government debt statistics are not always comparable across countries.

Gross debt vs net debt

To obtain a measure of net debt, one might subtract the government’s assets from the gross debt. Large differences between gross and net debt can arise when government agencies hold a large fraction of the government’s debt. For instance, about one-quarter of U.S. federal government debt is held in the Social Security Trust Fund, which funds future payments to retirees. In this case, one agency of government (the Treasury) is making payments to another agency of government (the Trust Fund). Therefore, U.S. statistical sources normally report ‘debt held by the public’, which nets out these cross-holdings.

From Figure 1, we can see that the difference between net and gross debt is large in Japan, where the government owns land and other assets valued at about 100% of GDP. At the other extreme, there are countries where the government holds few assets and for which gross and net debt are almost identical, as is the case of Barbados and Nigeria, for example.

But calculating net debt can be problematic, since some government assets are not traded, and so can be difficult to value. In terms of liquidity , government assets may not easily be sold if the government needs to raise cash in a debt crisis when it needs to buy back debt. This renders gross debt a better measure of vulnerability.

Further, standard public debt measures do not include payments to future pensioners for which trust fund resources have not yet been put aside, or other implicit liabilities of the public sector (for example, the need in the future to inject resources into loss-making state-owned enterprises). These unfunded liabilities can be important, but measuring them is not easy, conceptually or practically.

Figure 1 Gross and net debt as a share of GDP, selected countries, 2020.

IMF, 2021, World Economic Outlook April 2021 ; U.S. Department of the Treasury, 2022, Debt to the Penny ; Federal Reserve Bank of St. Louis, 2022, FRED ; Bank of Japan, 2022, Statistics .

In recent years, central banks have bought considerable amounts of public debt. The Bank of Japan holds 43% of Japanese government debt, and the U.S. Federal Reserve System holds 22% of U.S. federal government debt. If we remove these amounts from the net debt figure in Figure 1, Japan’s debt-to-GDP ratio would fall to 50% of GDP, and the U.S. debt ratio to 75%. It is tempting to make this adjustment, since the central bank is an arm of the public sector. The Federal Reserve System, like the Social Security Trust Fund, is part of the U.S. public sector. However, to purchase public debt, the Federal Reserve must issue liabilities of corresponding value. These take the form of reserves held by member banks at the central bank, on which the Federal Reserve pays interest. Because those reserves are not counted as public debt, it is conventional not to net out government securities held by the central bank.

Question 1 Choose the correct answer(s)

Which of the following statements about government debt are correct?

The Netherlands (GDP in 2004 of €601 billion) had government debt of approximately €204 billion at the end of 2003, and €214 billion at the end of 2004, so its deficit for the year 2004 was approximately €10 billion.
If the Argentinian government issues bonds denominated in U.S. dollars, it will become easier for the government to repay its debt if the dollar appreciates.
The difference between the gross and net measures of government debt is that unfunded pension liabilities are included in the gross but not in the net measure.
Different levels of government enable a country to monitor its public debt more precisely.
Deficit can be regarded as the difference in the stock of debt between 2003 and 2004.
If the dollar appreciates, it will become harder for Argentina to repay its debt, as the Argentine peso will be weaker compared to the dollar. For more details on the exchange rate, see Section 15.9 of The Economy .
Unfunded pension liabilities are included in neither definition; the difference is that government assets are deducted from the gross measure to calculate the net measure.
The existence of local governments makes keeping track of a country’s debt more difficult, with consequences for the precision of the statistics collected.
3 Public debt in history

States and sovereigns have long borrowed to mobilize resources to meet emergencies. Aristotle described how, in the fifth century BCE, Dionysius of Syracuse borrowed to finance military campaigns against the Carthaginians. 4 The English monarch Edward III (1312–1377) borrowed to continue the Hundred Years War with France. In the 1340s, with the arrival of the Black Death, the Italian city-states of Venice and Siena borrowed to mobilize public health resources.

For more details on the tax smoothing logic, you can read ‘ Federal deficit policy and the effects of public debt shocks ’ by Robert J. Barro, or ‘ On the determination of public debt ’ by Robert J. Barro, or ‘ The motives to borrow ’ by Ugo Panizza, Andrea F. Presbitero, Antonio Fatás, and Atish R. Gosh.

Until the late 20th century, debt finance by governments was predominantly war finance. War is the prototypical emergency, prompting governments to mobilize all available resources, including those that can only be mobilized by borrowing. What economists refer to as ‘ tax smoothing logic ’ suggests that the costs associated with mobilizing those resources should be spread over time rather than paid up front, all at once. High tax rates are especially distortionary, meaning that they cause inefficient behavior. For example, taxing investment income near or at a rate of 100% weakens or eliminates all incentive to invest. Rather than raising taxes sharply in times of war and lowering them back down when peace is restored, it therefore makes more sense to raise taxes moderately both in the present and in the future, while issuing debt to finance the immediate gap between revenues and essential spending.

Figure 2 illustrates this for the case of the United States. It shows the evolution of debt relative to GDP (that is, relative to the size of the economy, and how that history has been punctuated by war).

Figure 2 Evolution of the debt-to-GDP ratio in the U.S. (expressed in percentage terms), 1790–2020.

Federal Reserve Bank of St. Louis, 2022, FRED ; TreasuryDirect, 2022, ‘Monthly Statement of the Public Debt (MSPD) and Downloadable Files’ ; TreasuryDirect, 2022, ‘Historical Debt Outstanding: Annual 1790–1849’ .

Figure 2 also hints that the purposes for which governments have borrowed broadened in the 20th and 21st centuries. The U.S. federal government went deeper into debt, for example, in the Great Depression of the 1930s. The Depression, when the unemployment rate soared to 25%, was seen as a social crisis tantamount to war. It highlighted the government’s role in providing social insurance and other essential services in hard economic times. Because tax receipts fell off in the economic slump, the government had to borrow to finance their provision. The U.S. government, along with others, similarly borrowed to meet the emergencies created by the global financial crisis in 2008–2009 and the COVID-19 recession and health crisis.

Up through the Second World War, the U.S. government, having issued additional debt in response to geopolitical and economic emergencies, regularly reduced the debt-to-GDP ratio when the crisis passed. (Section 7 describes how in more detail.) Prudent governments that utilize their borrowing capacity in an emergency appreciate the need to restore that capacity subsequently, since there is no telling when it will have to be utilized again.

Since the 1980s, however, the picture looks different. U.S. federal government debt as a share of GDP has trended steadily upward, excepting only the 1990s, when strong economic growth and fiscal restraint under President Bill Clinton reduced the debt-to-GDP ratio. But taking the last four decades as a whole, the U.S. debt-to-GDP ratio has soared from 30% of GDP to more than 120%. What went up showed little tendency to come back down subsequently.

Question 2 Choose the correct answer(s)

Based on the information in this section, which of the following statements are true?

The logic of tax smoothing implies that raising debt can be seen as an alternative to raising taxes when the government needs to finance its expenditure.
Figure 2 shows that as GDP in the U.S. increased, so did the U.S. government debt-to-GDP ratio.
In the past, governments have only raised debt to finance war.
In recent decades, the trend of the debt-to-GDP ratio has changed in the U.S.
Tax smoothing logic presents the idea that raising debt can be seen as an alternative to raising taxes when the government needs to finance its expenditure.
Over time, the U.S. debt-to-GDP ratio increased, but Figure 2 does not plot U.S. GDP, so we cannot draw any conclusions about the correlation between these two variables.
In the past, governments have also raised debt in response to other problems, for example meeting the health emergency of pandemics.
Whereas in the past, governments tended to reduce the debt-to-GDP ratio once a crisis passed, this has not been the case since the 1980s.

Exercise 1 Debt-to-GDP ratio in other countries Collect data on the debt-to-GDP ratio of a country of your choice (other than the U.S.), for the longest time span available. For example, you can use the IMF Global Debt Database . Plot the data on a graph similar to Figure 2. Compare your graph with Figure 2 and describe the similarities and differences you see. (Hint: Doing Economics offers guidance on how to plot a line chart in Excel ).

4 The political economy of public debt

The recent upward trend of government debt as a share of GDP in the U.S. is part of a global trend evident in advanced (high-income), emerging, and low-income countries alike (as shown in Figure 3). Economists do not agree on what explains this trend.

Figure 3 Interest expense and government debt, 2007–2021.

IMF Fiscal Monitor, April 2021. The blue bars plot government debt as percent of GDP (left scale) and the orange line plots interest expenses as percent of GDP (right scale).

Some see this increase in debt as a symptom of political dysfunction (for more details on how political interests can constrain governments and policymakers see Section 22.12 of The Economy ). Casual observation and data suggest that political polarization, defined as the distance between the policy preferences of different political parties, is on the rise. 5 6 When their spending preferences are very different—when polarization along this dimension is severe—the party in power will want to maximize spending on its preferred programs while in office, since it knows that the opposition will not continue those programs upon supplanting it. The party in power will be tempted to spend on its preferred programs whether or not the revenues are there.

For more details on ‘starving the beast’, you can read ‘ Do tax cuts starve the beast? The effect of tax changes on government spending ’ by Christina D. Romer and David H. Romer.

In addition, a political party that prefers low levels of government spending in general may rely on debt finance when in office in order to tie the hands of its successor. By requiring that successor to devote substantial resources to paying interest on an inherited debt, it can prevent it from devoting them to social programs. (This strategy, which increases reliance on debt finance by cutting taxes, is sometimes referred to as ‘starve the beast’.) Or the party in power may increase the deficit just prior to elections as a way of temporarily stimulating the economy and increasing its political chances.

Alternatively, what we see in Figure 3 might be efficient and rational. If interest rates on government debt decline, as they in fact have over the last four decades (see Figure 4), then it makes sense for governments engaged in tax smoothing to issue additional debt today, since the future taxes required to service it will be correspondingly lower.

Figure 4 Real interest rate estimated from inflation linked bonds in high-income economies and the U.S.

Rachel and Summers, 2019. The U.S. rate is based on treasury inflation-protected securities (TIPS). These are U.S. Treasury bonds that are indexed to inflation.

5 Analyzing debt dynamics

Note that variables without a subscript refer to the current period. While formal notation uses a subscript of t for all variables in the current period, this can look cluttered so we have chosen to exclude it.

We distinguish the primary deficit because policymakers have the capacity to adjust it by changing either taxes or primary expenditure. Interest payments, in contrast, are largely determined by the size of the debt (which is due to past decisions) and by the interest rates demanded by investors in order to hold government debt securities.

So far, we have seen that the debt-to-GDP ratio will change when the overall deficit (as a share of GDP) changes. If, for the moment, we assume that the economy is not growing then:

However, the equation above ignores the rate at which the economy grows, which also affects how the debt-to-GDP ratio changes. A given size of debt is a smaller proportion of GDP if the economy grows. Equivalently, the government will have greater resources available to pay back its debt.

Find out more Derivation of the basic equation for debt dynamics Here we use some basic arithmetic manipulations to derive Equation 5. We want to show that b−b_{t−1}≡ ∆b \approx d+(r−g)b_{t−1} , where \text{B} is the stock of debt, d is the primary deficit, Y is GDP, b and d are the debt-to-GDP ratio and the primary deficit-to-GDP ratio (that is, b=\text{B}/Y and d=\text{D}/Y ), and r and g are the real interest rate and real growth rate respectively. Start by writing: % The stock of debt today is equal to the stock of debt in the previous year plus primary expenditure ( \text{E} ), plus interest payments, minus government revenues ( \text{R} ). % Analogously, real GDP is equal to real GDP in the previous year plus real GDP growth: Y = Y_{t−1} (1 + g ). Substituting A2 into A1: \text{Δ}b = \frac{\text{B}_{t − 1} + \text{D} + \text{rB}_{t − 1}}{Y_{t − 1}(1 + g)} − \frac{\text{B}_{t − 1}}{Y_{t − 1}} Using Y_{t-1} (1+g) as the denominator: \mathrm{\Delta}b = \frac{\left( \text{B}_{t - 1} + \text{D} + r\text{B}_{t - 1} \right) - \text{B}_{t - 1}(1 + g)}{Y_{t - 1}(1 + g)} Or, simplifying: \mathrm{\Delta}b =\frac{\text{D} + r\text{B}_{t - 1} - g\text{B}_{t - 1}}{Y_{t - 1}(1 + g)} =\frac{\text{D}}{Y_{t - 1}(1 + g)} + \frac{r\text{B}_{t - 1} - g\text{B}_{t - 1}}{Y_{t - 1}(1 + g)} And, using the fact that Y=(1+g)Y_{t-1} , \text{Δ}b = \frac{\text{D}}{Y} + \frac{\text{rB}_{t − 1} − \text{gB}_{t − 1}}{Y_{t − 1}(1 + g)} = d + \frac{(r − g)}{(1 + g)}\frac{\text{B}_{t-1}}{Y_{t-1}} = d + \frac{(r − g)}{(1 + g)}b_{t − 1} Since g tends to be small, \frac{r − g}{(1 + g)} \approx (r − g) and \text{Δ}b \approx d + (r − g)b_{t − 1} . Note that the standard formula described above in the text, which is Equation 5, is an approximation. We should have written ∆b≈d+(r−g) b_{t−1} .

Find out more The importance of r − g in the history of debt dynamics As we’ve seen, the dynamics of public debt depend importantly on the difference between the real (inflation-adjusted) interest rate r and the economy-wide rate of economic growth g . The financial historian Paul Schmelzing has heroically assembled information on government bond yields for the now-advanced (high-income) economies (which include Europe and, in the subperiod from when it existed as a sovereign nation, the U.S.) and estimated growth rates over the last eight centuries (Figure 5). There’s lots of volatility, but r-g shows a tendency to trend downward over the long sweep of historical time. Figure 5 700 years of global r-g for the now-advanced (high-income) economies. Own elaborations based on data from Schmelzing, 2020. Several factors contributed to this development. The cost of borrowing declined as sovereign debt came to be recognized as an obligation of the state rather than of the individual occupying the throne, with the establishment of parliaments and legislatures in which creditors were represented, and with the creation of markets in which debt securities could be bought and sold. Meanwhile, growth rates went up with the industrial revolution and the transition to modern economic growth in the nineteenth and twentieth centuries. There has been a further fall in r-g in high-income economies in the last four decades, prompting debate about whether prevailing levels of debt are becoming less worrisome. To some extent, current low interest rates on government debt reflect high savings rates in emerging economies such as China and the high savings propensities of the wealthy, who have enjoyed disproportionate income gains in high-income economies. In addition, they reflect a safe-asset shortage due to the value investors attach to safe and liquid government bonds in a volatile economic and financial environment. Whether these favorable conditions for public-debt management will continue to prevail going forward is anyone’s guess.

Using the public debt simulator

Follow the steps in Figure 6 to understand what happens to government debt in four different scenarios.

Figure 6 Geometric representation of the debt dynamic equation.

Panel A: r > g and d > 0

Panel B: r > g and d < 0

Panel C: r < g and d > 0

Panel D: r < g and d < 0

Exercise 2 Plotting the dynamics of debt For this exercise, you will need sheet SIM1 of the public debt simulator. Choose two countries from the list provided, such that the debt-to-GDP ratio continually increases for one and stabilizes for the other. Calculate the debt-stabilizing primary deficit for each country using the spreadsheet. Draw by hand the geometric representation of the debt dynamics for each country, as in Figure 6. Use your diagram to explain the dynamics of debt in each country. (Hint. You can check your working by using sheet SIM2 of the public debt simulator.)

Figure 7 uses this setup to analyze the evolution of the debt of a country that starts the year 2020 with a 50% debt-to-GDP ratio ( SIM3 of the public debt simulator).

Factoring in inflation

The relationship between the nominal interest rate and expected inflation is described by the Fisher equation, which states that i=r+π^e , where π^e is expected inflation. For more details, see Section 15.1 of The Economy .

A higher deficit can be driven by higher expenditure or lower taxes (or both). The belief that tax cuts can pay by themselves is one of the basic tenets of supply side economics, as you can read in Foundations of Supply-Side Economics by Victor Canto, Douglas Joines, and Arthur Laffer. For a critical evaluation, see ‘Evidence on the High-Income Laffer Curve from Six Decades of Tax Reform’ by Austan Goolsbee, or ‘The Elasticity of Taxable Income with Respect to Marginal Tax Rates: A Critical Review’ by Emmanuel Saez, Joel Slemrod, and Seth Giertz.

An important complication concerns the link between deficit spending and GDP growth. Issuing debt to finance productive investment expenditure can have a positive effect on long-run GDP growth. Similarly, countercyclical deficit spending can have a positive effect on GDP growth in the short run. In Equation 7, a larger deficit will lead to a proportional increase in the debt-to-GDP ratio, other things being equal. But when debt is issued to undertake actions that affect the evolution of GDP, other things are no longer equal. Those actions will raise the denominator of the debt-to-GDP ratio. Faster GDP growth will lead to higher tax revenues. In theory, there are even conditions in which a higher deficit could reduce the debt-to-GDP ratio.

Question 3 Choose the correct answer(s)

Which of the following statements about debt dynamics are true?

The nominal value of the debt the government has to repay is reduced by a higher rate of inflation.
It is not possible for a government to run a primary deficit and keep its debt-to-GDP ratio constant.
If the rate at which the economy grows is lower than the interest rate on debt, it is still possible for debt-to-GDP ratio not to increase.
Inflation does not affect the nominal value of the debt since it is fixed in nominal terms. Inflation affects the real burden of the debt.

Question 4 Choose the correct answer(s)

Suppose that a country’s debt-to-GDP ratio is 100%, the economy is growing at a rate of 1%, and the government is intending to run a 1% deficit. Which of the following statements are true?

The debt-to-GDP ratio can be kept constant if inflation is at the same rate as the interest rate on debt.
Even if the current real interest rate is above the economy’s growth rate, a forward-looking government could justify an increase in its borrowing on economic grounds.
A spike in inflation will make it more difficult for the government to reduce its debt.
The government may anticipate a lower real interest rate in the future; its borrowing may finance investment that is expected to raise the economy’s growth rate.

Exercise 3 Using the debt dynamics equation Go to the OECD Data website. For this exercise, make sure you download the data in yearly frequency and as a percentage of GDP when necessary. For this exercise, you will need to download data for the following variables: nominal long-term interest rates inflation rates real GDP growth (hint: look for quarterly GDP and select a yearly frequency) primary deficit and debt-to-GDP ratios (hint: look for general government deficit and general government debt, respectively); note that on the OECD Data website, a positive value of the primary deficit ratio means that the government is running a surplus. Find and download data for the long-term interest rate and inflation rate of a country of your choice, over the longest time span for which data is available. Using the Fisher equation, calculate the real interest rate for each year observed. Plot the real interest rate on a line chart. How does the trend you observe in the real interest rate compare with that described in Figure 4 ? Now add the growth rate of real GDP to your chart. From a quick look at your chart, in which periods would you expect debt to expand? In which periods would you expect it to contract? Finally, add to your plot the primary deficit and the debt-to-GDP ratio. Does the debt-to-GDP ratio follow your predictions from Question 3? (Hint: For clarity, you can plot the debt-to-GDP ratio adding a secondary axis.) Take the average values of all the variables you plotted over the most recent available 10 years in the data. Use these values to predict how debt for your chosen country will behave in the future. You can use Figure 6 to help you comment on its likely trend over time. (Hint: You can check your prediction by using the public debt simulator, sheet SIM3 .) Discuss whether you think that your prediction is reasonable.

6 The unexplained part of public debt

Public-debt analysts accommodate this fact by appending another term to the equation:

The term ‘off-budget resources’ refers to expenditures that are not included in the government budget. For instance, the government may set up a special entity to borrow money for a particular task (such as to finance bank recapitalization or a specific investment project). Since borrowing is not done directly by the government, it is often not included in the government budget. There are cases, however, in which the government needs to borrow directly to recapitalize such off-budget entities and this borrowing can lead to sudden jumps in public debt which are not reflected in budgeted public expenditures. For details, see ‘Underground Government: The Off-Budget Public Sector’ by James Bennett (2004).

The stock-flow reconciliation is represented by sf . This cumbersome name comes from the fact this residual item exactly reconciles the deficit, interest payments, and the change in GDP with the stock of debt. This term is also referred to as ‘the unexplained part of public debt’.

Equation 7 works well enough, obviously, when such discrepancies are small. At times, however, they can be large. This will be the case, for example, when a banking crisis forces the government to use off-budget resources to inject funds into the banking system, or when it recapitalizes a large state-owned corporation. It can be the case when public debt is denominated in foreign currency and the exchange rate depreciates, causing the value of the debt to shoot up relative to GDP (which is denominated in domestic currency). ‘Find out more: The case of COVID-19’ , where we use Equation 8 to decompose the increase in debt ratios during the COVID-19 pandemic, shows that this reconciliation can be important in practice.

Find out more The case of COVID-19 Governments around the world increased public spending and ran substantial budget deficits in response to the COVID pandemic, leading to sharp increases in debt-to-GDP ratios. In the advanced economies, debt-to-GDP ratios rose from about 100% in 2019 to more than 120% in 2020. In emerging and developing economies, ratios went from an average of 54% to 63% (see Figure 8). Figure 9 uses Equation 8 to decompose the growth of the debt ratio into the contributions of the primary deficit, interest payments, inflation, real GDP growth (in this case, negative growth), and the stock-flow reconciliation. The variables above the zero line increased the debt-to-GDP ratio, while the variables below the line reduced it. The figure shows that the two main drivers of the increase in the debt-to-GDP ratio were the increase in deficits and contraction of GDP. The red bars show that the primary deficit added 10 percentage points to the debt ratio in the advanced economies and 7.5 percentage points in emerging and developing economies. Negative growth (the blue bars) also contributed to the increase in the debt-to-GDP ratio, where the effect was again larger in the advanced economies. Note that if growth had been positive instead of negative, the blue bars would have been in the bottom part of the graph. This difference reflects two elements. Firstly, the GDP contraction was smaller in emerging and developing economies (2 percentage points versus nearly 5 percentage points). Secondly, the initial level of debt was smaller in emerging and developing economies (remember that, in Equation 8, GDP growth is interacted with the initial debt/GDP ratio). In particular, the contribution of negative growth to the increase in the debt ratio is high in Latin America both because the recession was deeper than in other emerging economies and because the initial debt level was higher. Finally, in all regions inflation played some role in mitigating the growth of debt. Figure 8 Debt-to-GDP ratio in advanced and emerging economies. Authors’ elaborations based on IMF Data. Figure 9 Drivers of the increase of the debt-to-GDP ratio over 2019 to 2020. Authors’ elaborations based on IMF Data.

7 How governments repay

Recall the debt dynamics equation, which reads:

However, there are relatively few recent instances where governments have succeeded in running substantial surpluses for extended periods. One study found just three cases of countries that ran surpluses of 5% of GDP for 10 consecutive years. 7 When revenues rise, governments face pressure from voters to increase spending and not just retire debt. Economic shocks, from recessions to financial crises and pandemics, can throw the effort to maintain primary surpluses off course.

In addition, a sudden shift from deficit to surplus (for example, by undergoing a period of austerity ) risks precipitating a recession by depressing aggregate demand. Efforts to reduce the debt-to-GDP ratio that end up only reducing GDP can be counterproductive even from the narrow standpoint of fiscal consolidation. Thus, euro area countries, having borrowed in response to the Global Financial Crisis of 2008–2009, sought to reduce those deficits starting in 2010 before recovery from recession was secure. The result was that the euro area slid back into recession starting in June 2011, causing the debt-to-GDP ratio to rise rather than fall.

For more details on the effects of austerity policies, see Section 14.6 of The Economy .

Replicating that growth success today, unfortunately, is unlikely. In many countries, labor supply is growing more slowly. Productivity growth has slowed since the mid-1970s.

Financial markets today are more lightly regulated, however, limiting scope for financial repression. International capital mobility is higher than after the Second World War, enabling investors faced with artificially low interest rates in one national market to shift their funds to another.

Light-touch regulation and international capital mobility also limit the scope for using inflation to reduce the value of the debt relative to GDP. Inflation might seem like a foolproof way of raising the denominator of the debt-to-GDP ratio. But if it leads to a commensurate increase in the cost of servicing that debt (in the nominal interest rate), then the government saves nothing. In countries such as Brazil, where the vast majority of public debt is either short term (maturing in a year or less) or indexed (where the contract specifies that payments rise one-to-one with inflation), there is little scope for inflating away the debt.

Question 5 Choose the correct answer(s)

Primary (budget) surpluses are not a viable option to reduce debt.
If the economy grows faster, the debt-to-GDP ratio will be reduced solely because of an increase in GDP in the denominator.
A trustworthy government will likely face a lower real interest rate.
Governments can easily turn to inflation to reduce the real interest rate it faces.
They are theoretically a viable option to reduce debt (look at Equation 5), although they may be difficult politically to implement.
If a government establishes a good reputation for duly paying back debt, investors will be less inclined to demand a higher interest rate on debt.
8 And what happens when they don’t?

If governments fail to take the necessary measures to reduce debt, they may eventually renege on their debts. They can announce an inability to meet their contractual obligations and just stop paying. They will be declared to be in default by the International Swaps and Derivatives Association, the organization that oversees trading of credit default swaps (derivative securities that provide insurance against defaults). But because national governments enjoy a degree of immunity from being sued in foreign courts, foreign creditors have relatively little legal recourse.

Governments tend to be reluctant to default on domestic creditors, since the latter do, in fact, possess recourse: they can eject the defaulting government from office. Hence, governments are more likely to use indirect means to reduce the value of domestic debts. Specifically, they may attempt to inflate them away. A classic example is Germany after the First World War, when the government had a debt-to-GDP ratio of 100%. By running a very high rate of inflation, that debt was liquidated. As shown in Figure 10, its real, purchasing-power value was reduced to zero.

Figure 10 Public debt ratio in Germany, 1910–1938.

Eichengreen, El-Ganainy, Esteves & Mitchener, 2021. In Defense of Public Debt . New York: Oxford University Press.

If there is an easy way out, then why don’t governments always default or inflate away their debts? The obvious explanation is potential for retaliation by the creditors. Investors may refuse to buy treasury bonds in the future, or they may demand a substantial risk premium. Germany again illustrates this point: the Weimar government had to pay very high interest rates when seeking to resume borrowing after 1923.

But adverse financial consequences don’t always deter opportunistic behavior by indebted governments, which is why sovereign defaults are common in history. Some economists suggest that in many cases, a government’s immediate savings on interest and principal payments are likely to dominate any costs it incurs as a result of being penalized by investors at some future date.

That we see governments continuing to pay and investors continuing to lend therefore implies that there are other, indirect costs of default. In the nineteenth century, those costs took the form of gunboat diplomacy. Creditor-country governments would send in troops to seize the resources needed to make payments. In the 1930s, countries that defaulted were subject to retaliatory tariffs by creditor-country governments. After the Second World War, the doctrine of sovereign immunity was weakened, allowing the creditors to sometimes seize planes and vessels belonging to the national airline or government when these landed or docked outside the country. (See ‘Find out more: Debt restructuring’ for more details.) Foreign banks, seeing the government as unreliable, can stop providing trade credit, so exports and economic growth may suffer.

Find out more Debt restructuring When a household or firm is unable to pay a debt, its finances are reorganized and the creditors receive compensation through a legal proceeding—that is, through the deliberations of a bankruptcy court. Not so when a sovereign government is unable to pay. If the debt contract is issued under domestic law, then the government can simply adopt new legislation changing its terms or repudiating it entirely—end of story. Even if it is subject to a foreign law, the creditors still have limited legal redress, since under the prevailing doctrine of sovereign immunity, sovereign states can be sued only with their permission, which they rarely grant. free ride Benefiting from the contributions of others to some cooperative project without contributing oneself. The creditors’ only option is to negotiate. But a number of factors can make it hard to reach agreement. Firstly, sovereign debtors are better able to judge how much adjustment effort is economically and politically possible and therefore what they can offer their creditors. The creditors may therefore reject the government’s proposal as an attempt to underpay them even when that offer is realistic. Secondly, there can be conflicts of interest among the creditors. Opportunistic investors, sometimes referred to as ‘vulture funds’, may buy up bonds in default for a few cents on the dollar and demand full repayment, in effect ‘ free riding ’ on the debt relief agreed by others. They may try to convince a compliant court that the doctrine of sovereign immunity doesn’t apply. For example, following a 2001 default, the government of Argentina famously waged a 15-year battle with its holdout creditors. A defining moment was when a subsidiary of the U.S. hedge fund Elliot Capital Management managed to convince a Ghanaian court to seize a three-masted tall ship visiting the country as part of a goodwill mission by the Argentine government. A number of mechanisms have been developed for addressing these problems. The International Monetary Fund may use its data-gathering capacity to help overcome information asymmetries. It may extend bridge loans to tide over countries acting in good faith but facing delays in negotiations. Legislators and regulators in the principal financial centers may pass laws and rules weakening the position of holdout creditors. Issuers may add renegotiation-friendly contractual provisions to their loan agreements, such as the majority action clauses and pari pasu clauses requiring all creditors to be treated equally. Creditors may form committees in an effort to solve coordination problems. There have also been proposals for the creation of an international bankruptcy court with the power to ‘cram down’ settlement terms on both sides. Given the absence of a global government to oversee it, however, these proposals have come to nothing.

Exercise 4 Causes and consequences of sovereign default Use the following sources to answer the questions below. You may also want to do your own research to find more background readings on this topic. Esteves, Kenny, and Lennard, ‘The Aftermath of Sovereign debt Crises’ , and ‘The Aftermath of Sovereign debt Crises: A Narrative Approach’ Sims and Romero, Federal Reserve History, ‘Latin American Debt Crisis of the 1980s’ Kremer and Jayachandran, ‘Odious Debt: When Dictators Borrow, Who Repays the Loan?’ . Provide one example of a debt default that was preceded by a recession in the domestic economy, and one example where the default resulted from political events. In each case, discuss the economic consequences of the default. Are governments punished for defaulting on public debt? Should they be?

9 Rules and institutions for public debt management

Maintaining sustainable debt levels can be challenging for political as well as economic reasons. Governments have taken two approaches to this problem: budgetary rules on the one hand, and institutions and procedures on the other. Rules may be embodied in a legal statute or a country’s constitution. Germany’s ‘debt brake’, for example, was written into the Federal Republic’s constitution in 2009. This limits annual federal government borrowing to no more than 0.35% of GDP. Articles 121 and 126 of the ‘Treaty on the Functioning of the European Union’ (originally the Treaty of Rome) and associated protocols commit EU member states to limiting their debt and deficits to 60% and 3% of GDP, respectively. In other jurisdictions, rules set separate targets or limits for the growth of government spending and/or revenues.

For further details on the Greek debt crisis in 2009, you can read ‘ Greece’s Debt ’ by the Council on Foreign Relations; or ‘ Breaking the Greek debt impasse ’ by Barry Eichengreen, Peter Allen, and Gary Evans; or ‘ Putting the Greek debt problem to rest ’ by Barry Eichengreen, Emilios Avgouleas, Miguel Poiares Maduro, Ugo Panizza, Richard Portes, Beatrice Weder di Mauro, Charles Wyplosz, and Jeromin Zettelmeyer.

The strength of fiscal rules is their simplicity. Everyone knows what is meant by 60% of GDP, and monitoring compliance is relatively straightforward. Or is it? The Greek debt crisis in 2009 was triggered when a new government announced that its predecessor had cooked the books and that the public-sector debt and deficit were significantly higher than acknowledged previously. And as we saw earlier, there are many different ways of calculating the debt.

The weakness of rules is their arbitrariness. No single limit on the deficit or debt is right for all countries at all times. There is no single threshold where debt is too much—where it suddenly becomes a drag on growth. (See ‘Find Out More: Public debt and economic growth’ for further discussion.) The EU’s 60% ceiling on the debt ratio just happened to be the average in Europe when the Maastricht Treaty was negotiated, and a 3% deficit just happened to be the level needed to keep that debt ratio constant, given then prevailing interest rates and growth rates. Interest rates, growth rates and debt ratios are all very different today, of course. An arbitrary rule not tailored to circumstances is unlikely to garner respect and compliance. Thus, both Germany and France violated the Maastricht Treaty’s 3% ceiling on deficits within five years of the euro’s creation.

Find out more Public debt and economic growth Does too much public debt hamper economic growth? High levels of debt could put upward pressure on interest rates and crowd out private investment. They could increase uncertainty about future taxation and inflation. If heavy debts make it difficult for the government to issue additional debt, they could limit the pursuit of countercyclical fiscal policies. For surveys of the literature on these questions, see ‘Public Debt and Economic Growth in Advanced Economies: A Survey’ by Ugo Panizza and Andrea Presbitero; ‘The 90% Public Debt Threshold: The Rise and Fall of a Stylized Fact’ by Balázs Égert; or ‘Do Higher Public Debt Levels Reduce Economic Growth?’ by Philipp Heimberger.

In an influential 2010 article , the economists Carmen Reinhart and Kenneth Rogoff concluded that high levels of public debt are negatively correlated with economic growth once debt exceeds 90% of GDP. Subsequent research reanalyzed their data and criticized their findings. Those subsequent studies did not find consistent evidence of threshold effects at 90% or other levels. It still makes sense, of course, that at some point, public debts become so heavy that they constitute a burden for society and for growth. But the debt-to-GDP ratio at which any negative effects begin to become evident will vary with country conditions. Equation 5 in Section 5 shows that the level of debt is less likely to be a concern when the growth rate of the economy is high and when the interest rate is low. The level of debt at which negative effects begin to become evident will be higher when a country has the economic, financial, and political wherewithal to mobilize a higher share of GDP in the form of taxes and run primary surpluses. But analyzing the growth-debt nexus requires careful study of specific country cases, not a search for magic numbers.

An important issue is causality . Even if there is evidence that public debt is, on average, negatively correlated with economic growth, correlation does not necessarily imply causation. Low economic growth could simply be leading to high levels of debt. Alternatively, the observed correlation between debt and growth could be due to a third factor that affects both debt and growth. Again, this points to the need for caution before making general statements about the effect of public debt levels on economic growth.

Another weakness of fiscal rules is that if rules are too rigid, they will not accommodate the special circumstances of a recession, financial crisis, or pandemic. But if they are too flexible and easily relaxed, they will lack credibility. Observers expecting exceptions to be invoked will doubt that the rules will be enforced. The EU has tried to strike a balance between credibility and flexibility, enhancing the first by adding to its own agreement a version of the German debt brake, while enhancing the second by making provision for the business cycle when gauging countries’ compliance with its rules. This balancing act remains a work in progress.

The alternative is strengthening institutions and procedures in order to increase transparency and avoid the kind of problems experienced by Greece in 2009. Countries can create a non-partisan fiscal watchdog such as the U.S. Congressional Budget Office, the Netherlands Bureau for Economic Policy Analysis, or the UK Office for Budget Responsibility to provide independent estimates of the public finances and their sustainability. They can create an autonomous fiscal council with its own budget, and staffed by experts serving long terms in office, to provide realistic forecasts of tax revenues and economic growth. They can require budgeting to incorporate those forecasts, thereby preventing governments from basing spending plans on unrealistic assumptions. Chile, for example, has an Autonomous Fiscal Council that calculates cyclical adjustments to observed budgetary outcomes, comments on possible deviations from announced structural balance targets, and proposes mitigation measures. A growing number of countries are moving in this direction .

Exercise 5 The role of fiscal councils Look for the website of the autonomous fiscal councils in two countries of your choice. You can use the IMF Fiscal Council Dataset , for example, if you want to find out which countries have one. Briefly summarize the purposes of your chosen councils. How do they provide incentives for the government to manage its debt appropriately? The economist Beetsma and his colleagues suggest that countries with an autonomous fiscal council tend to do better at fiscal forecasts and compliance with fiscal rules. Why might a government not want to establish such a council? (Hint: You may find the article ‘What are fiscal councils, and what do they do?’ helpful.) Find a country that does not have an autonomous fiscal council. Might this have impacted the management of public finances?

Question 6 Choose the correct answer(s)

The EU set a 60% debt-to-GDP and 3% deficit-to-GDP limit because these are the optimal amounts of debt and deficit relative to GDP.
Relatively high levels of debt can harm growth, but only if the level exceeds 90% of GDP.
Bending fiscal rules in extreme circumstances can give them credibility.
Autonomous fiscal councils decide the government’s budget.
Those values happened to be the prevailing values when the Maastricht Treaty was negotiated.
Relatively high levels of debt can harm growth, but there is no consensus on how ‘high’ they have to be to hamper growth.
Fiscal rules that are too strict risk not being accommodated when exceptional circumstances happen, for example during a recession. A certain degree of flexibility for these occasions can increase their credibility.
They are watchdogs, that is, bodies which provide independent estimates of tax receipts, growth, and public finances—so their role is a monitoring one.
10 Conclusion

Public debt allows governments to mobilize resources to meet emergencies, from wars, pandemics, and natural disasters to financial crises and recessions. Costs can be spread over time, avoiding the need to raise taxes to highly distortionary levels. Public debt issuance enables the government to finance productive investments that enhance the economy’s capacity to grow and that generate a stream of returns, enabling the Treasury to pay interest and repay the principal. A market in public debt allows the authorities to finance budget deficits in economic downturns. It allows them to use fiscal policy as a macroeconomic stabilization and insurance tool.

But public debt can also be issued imprudently to advance the private ends of those in power. Unproductive borrowing that does nothing to enhance the economy’s capacity to grow can be a burden on future generations required to pay additional taxes to service inherited debts. Incumbent politicians may borrow in order to boost spending just prior to elections and increase their political chances. A political party when in office may borrow to boost spending on its preferred programs, knowing that if it is supplanted by the political opposition no such spending will occur. Managing public debt poses a ‘common pool problem’. Each special interest favors issuing a little more to finance increases in its preferred programs without internalizing its contribution to the total debt burden.

Countries devise political and institutional mechanisms to restrain such behavior. They impose numeral limits for debts and deficits, incorporating these into statutory laws and constitutional amendments. They create independent government agencies to assemble and publish accurate data on the public finances, informing policy decisions. They constitute independent fiscal commissions to advise on fiscal choices. Such arrangements increase the likelihood that the government’s borrowing capacity will be used prudently. But they do not work perfectly, which is why public debt, unavoidably, retains its mixed reputation.

11 Acknowledgements

The authors would like to thank the CORE editors who invited them to write this Insight and provided helpful suggestions and feedback.

CORE is grateful to Sam Glendenning, Simran Krishna-Rogers, and Elena Xu for their valuable feedback.

Header image credit: Italian bond issued in France to finance a railway in Italy: Courtesy of Ugo Panizza

12 References
Abbas, S. Ali, Alex Pienkowski, and Kenneth Rogoff. 2019. Sovereign Debt: A Guide for Economists and Practitioners . Oxford: Oxford University Press.
Abbas, S. Ali, Nazim Belhocine, Asmaa El-Ganainy and Mark Horton. 2016. ‘ A Historical Public Debt Database ’. IMF Working Paper WP/10/245. Washington, DC: IMF.
Azzimonti, Marina. 2013. ‘The Political Polarization Index’ . Working Paper 13–41. Federal Reserve Bank of Philadelphia.
Beetsma, Roel, Xavier Debrun, Xiangming Fang, Young Kim, Victor Lledó, Samba Mbaye, and Xiaoxiao Zhang. 2018. ‘ Independent Fiscal Councils: Recent Trends and Performance ’. IMF Working Paper WP/18/68. Washington, DC: IMF.
Bennett, James T. 2004. ‘Underground Government: The Off-Budget Public Sector’. In The Encyclopedia of Public Choice , eds. Charles K. Rowley, and Friedrich Schneider. Boston, MA: Springer.
Bulow, Jeremy and Kenneth Rogoff. 1989. ‘Sovereign Debt: Is to Forgive to Forget?’. American Economic Review 79(1): pp. 43–50.
Campos, Camila F.S., Dany Jaimovich, and Ugo Panizza. 2006. ‘The Unexplained Part of Public Debt’ . Emerging Markets Review 7(3): pp. 228–243.
Canto, Victor A., Douglas H. Joines, and Arthur B. Laffer. 1983. Foundations of Supply-Side Economics . New York: Academic Press.
Cecchetti, Stephen, Madhusudan Mohanty, and Fabrizio Zampolli. 2011. ‘ The Real Effects of Debt ’. BIS Working Paper no. 352. Basel: Bank for International Settlements.
Cowan, Kevin, Eduardo Levy Yeyati, Ugo Panizza, and Federico Sturzenegger. 2006. ‘Sovereign Debt in the Americas: New Data and Stylized Facts’ . Working Paper 557. Washington, DC: Inter-American Development Bank.
Égert, Balázs. 2015. ‘The 90% Public Debt Threshold: The Rise and Fall of a Stylized Fact’ . Applied Economics 47(34–35): pp. 3756–3770.
Eichengreen, Barry and Ugo Panizza. 2016. ‘A Surplus of Ambition: Can Europe Rely on Large Primary Surpluses to Solve its Debt Problem?’. Economic Policy 31(85): pp. 5–49.
Eichengreen, Barry, Asmaa El-Ganainy, Rui Esteves, and Kris James Mitchener. 2021. In Defense of Public Debt . New York: Oxford University Press.
Fiscal Monitor. 2021. ‘Strengthening the Credibility of Public Finances’ (October). Washington, DC: International Monetary Fund.
Furman, Jason and Lawrence Summers. 2020. ‘US Debt has Increased, But Burden of Servicing it has Fallen’ . Peterson Institute for International Economics . Updated 16 December 2020.
Gelpern, Anna and Ugo Panizza. 2022. ‘Enough Potential Repudiation: Economic and Legal Aspects of Sovereign Debt in the Pandemic Era’ . Graduate Institute of International and Development Studies , International Economics Department Working Paper Series.
Goolsbee, Austan, (1999), ‘Evidence on the High-Income Laffer Curve from Six Decades of Tax Reform’ . Brookings Papers on Economic Activity 30(2): pp. 1–64.
Heimberger, Philipp. 2021. ‘Do Higher Public Debt Levels Reduce Economic Growth?’ . wiiw Working Paper 211. Vienna: Vienna Institute for International Economic Studies.
Jefferson, Thomas. 1816. Letter to John Taylor Monticello May 28, 1816 . American History. Accessed 11 March 2022.
Mitchener, Kris James and Christoph Trebesch. 2021. ‘Sovereign Debt in the 21st Century: Looking Backward, Looking Forward’ . NBER Working Papers 28598. Cambridge, MA: National Bureau of Economic Research.
Panizza, Ugo and Andrea Presbitero. 2013. ‘Public Debt and Economic Growth in Advanced Economies: A Survey’ . Swiss Journal of Economics and Statistics 149(2): pp. 175–204.
Rachel, Lukasz and Lawrence Summers (2019) ‘On Secular Stagnation in the Industrialized World’ . Brookings Papers on Economic Activity 50(1): pp. 1–76.
Reinhart, Carmen M. and Kenneth Rogoff. 2010. ‘Growth in a Time of Debt’ . American Economic Review 100(2): pp. 573–578.
Reinhart, Carmen M. and M. Belen Sbrancia. 2015. ‘The Liquidation of Government Debt’. Economic Policy 30(82): pp. 291–333.
Reinhart, Carmen M., Jacob Kirkegaard, and M. Belen Sbrancia. 2011. ‘Financial Repression Redux’ . Finance and Development 48(1): pp. 22–26.
Romer, Christina and David Romer. 2009. ‘Do Tax Cuts Starve the Beast? The Effect of Tax Changes on Government Spending?’ . Brookings Papers on Economic Activity Vol. 2009(1): pp. 139–200.
Saez, Emmanuel, Joel Slemrod, and Seth H. Giertz. 2012. ‘The Elasticity of Taxable Income with Respect to Marginal Tax Rates: A Critical Review’. Journal of Economic Literature 50(1): pp. 3–50.
Schmelzing, Paul. 2020. ‘Eight Centuries of Global Real Rates, R-G, and the ‘Suprasecular’ Decline, 1311–2018’ . Bank of England Working Paper 845. London: Bank of England.
Smith, Adam. (1776) 1981. An Inquiry into the Nature and Causes of the Wealth of Nations . Carmel, IN: Liberty Fund.
Talisse, Robert B. 2019. ‘Political Polarization is about Feelings, not Facts’ . The Conversation . Updated 31 July 2019.
Yared, Pierre. 2019. ‘Rising Government Debt: Causes and Solutions for a Decades-Old Trend’ . Journal of Economic Perspectives 33(2): pp. 115–140.

Fiscal Monitor. 2021. ‘Strengthening the Credibility of Public Finances’ (October). Washington, DC: International Monetary Fund. ↩

Thomas Jefferson. 1816. Letter to John Taylor Monticello May 28, 1816 , para. 7. ↩

Adam Smith. 1776. An Inquiry into the Nature and Causes of the Wealth of Nations . Volume 5, Book 3. ↩

Eichengreen, Barry, Asmaa El-Ganainy, Rui Esteves, and Kris James Mitchener. 2021. In Defense of Public Debt . New York: Oxford University Press. ↩

Marina Azzimonti. 2013. ‘The Political Polarization Index’ . Working Paper 13–41. Federal Reserve Bank of Philadelphia. ↩

Robert B. Talisse. 2019. ‘Political Polarization is about Feelings, not Facts’ . The Conversation . Updated 31 July 2019. ↩

Barry Eichengreen and Ugo Panizza. 2016. ‘A Surplus of Ambition: Can Europe Rely on Large Primary Surpluses to Solve its Debt Problem?’. Economic Policy 31(85): pp. 5–49. ↩

All CORE Insights
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This resource is developed by the CORE project. More information and additional resources for learning and teaching can be found at www.core-econ.org .

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FAQs for the Public Debt

General information.

Note: Following federal law, we (the Bureau of the Fiscal Service) account for and report on the public debt. We do not have decision-making authority for public policy about the budget or the debt.

You can see current and past budgets for the federal government at https://www.govinfo.gov/app/collection/budget .

On this page, we answer questions about the federal public debt (and related topics).

Visit our Fiscal Service web site for more information. Information about the "Budget of the United States" is available at the Government Printing Office web site .

The deficit is the fiscal year difference between what the United States Government (Government) takes in from taxes and other revenues, called receipts, and the amount of money the Government spends, called outlays. The items included in the deficit are considered either on-budget or off-budget.

When the outlays in a fiscal year are more than the receipts, we have a deficit. When the receipts in a fiscal year are more than the outlays, we have a surplus.

You can think of the total debt as accumulated deficits plus accumulated off-budget surpluses.

See the Monthly Treasury Statement of Receipts and Outlays of the United States Government (MTS) .

The on-budget deficits require the U.S. Treasury to borrow money to raise cash needed to keep the Government operating. We borrow the money by selling securities like Treasury bills, notes, bonds, and savings bonds to the public.

The Treasury securities issued to the public and to the Government Trust Funds (Intragovernmental Holdings) then become part of the total debt.

For information about the deficit, visit the Fiscal Service website to view the Monthly Treasury Statement of Receipts and Outlays of the United States Government (MTS) .

The Public Debt Outstanding represents the face amount or principal amount of Treasury marketable security and Treasury non-marketable securities currently outstanding.

The Public Debt Subject to Limit is the maximum amount of money the Government is allowed to borrow without receiving additional authority from Congress.

The Public Debt Subject to Limit is the Public Debt Outstanding adjusted for Unamortized Discount on Treasury Bills and Zero Coupon Treasury Bonds, Miscellaneous debt (very old debt), Debt held by the Federal Financing Bank and Guaranteed Debt.

Our current accounting system produces the Public Debt Outstanding amount daily.

Our system relies on reporting entities (for example, Federal Reserve Banks) to report a variety of Treasury security information at the end of the day. On the following business day, our accounting system processes this information and generates the Public Debt Outstanding for the previous day which is posted to our website by 3 PM.

Although we continually look for methods to improve our process, daily accounting is still the most effective, efficient, and accurate way to account for the debt.

See the daily accounting of the public debt .

Makeup of the Debt

The Monthly Statement of the Public Debt (MSPD) is available online in summary and full versions, and lists the types of Treasury Securities we have issued to finance the Debt, the related maturity dates, and the "Amount Outstanding" for each category as well as subtotals and an overall total.

Ownership of the Debt

The Treasury Bulletin , available at our Fiscal Service website categorizes ownership of U.S. Government securities by types of investors.

The Debt Held by the Public is all federal debt held by individuals, corporations, state or local governments, Federal Reserve Banks, foreign governments, and other entities outside the United States Government less Federal Financing Bank securities. Types of securities held by the public include, but are not limited to, Treasury Bills , Notes , Bonds , TIPS , United States Savings Bonds , and State and Local Government Series securities .

Intragovernmental Holdings are Government Account Series securities held by Government trust funds, revolving funds, and special funds; and Federal Financing Bank securities. A small amount of Treasury marketable securities are held by government accounts.

The Federal Financing Bank (FFB) is a government corporation, created by Congress in 1973 under the general supervision of the Secretary of the Treasury. The FFB was established to centralize and reduce the cost of federal borrowing as well as federally-assisted borrowing from the public. Obligations are issued to the public by the Federal Financing Bank (FFB) to finance its operations. Obligations are limited to $15 billion unless otherwise authorized by the Appropriations Acts.

Financing the Debt

The Public Debt Outstanding goes down when the total amount of Treasury securities that people cash in is more than the total amount of Treasury securities that people buy.

There are two ways for you to make a contribution to reduce the debt:

At Pay.gov , you can contribute online by credit card, debit card, PayPal, checking account, or savings account.
You can write a check payable to the Bureau of the Fiscal Service, and, in the memo section, notate that it's a gift to reduce the debt held by the public. Mail your check to: Attn Dept G Bureau of the Fiscal Service P. O. Box 2188 Parkersburg, WV 26106-2188

The Civil Service Retirement And Disability Fund And Government Securities Investment Fund Related To The Debt Limit

The following frequently asked questions provide further information on the actions Treasury is taking to create additional headroom under the debt limit so that the U.S. government can continue funding obligations made by Congresses past and present.

Civil Service Retirement and Disability Fund (CSRDF)

The CSRDF provides defined benefits to retired and disabled Federal employees covered by the Civil Service Retirement System.

The CSRDF is invested in special-issue Treasury securities, which count against the debt limit. In 1986, Congress provided Treasury statutory authority to take certain actions in the event that the outstanding debt reaches the debt limit. Specifically, the statute authorizes the Secretary of the Treasury to determine that a "debt issuance suspension period" exists and, once he has done so, Treasury can (1) redeem certain existing investments in the CSRDF, and (2) suspend new investments by the CSRDF.

The statute governing the CSRDF gives Treasury authority to redeem existing Treasury securities held by the CSRDF in an amount up to the amount of civil service benefit payments authorized to be made from the CSRDF during the debt issuance suspension period.

Under the statute that governs the CSRDF, the term "debt issuance suspension period" means the period of time that the Treasury Secretary determines that Treasury securities cannot be issued without exceeding the debt limit. The determination of the length of the period is based on the facts as they exist at the time.

The statute authorizes Treasury to suspend the investment of new amounts by the CSRDF during a debt issuance suspension period. New receipts include contributions from Federal employees and agency employers, as well as the interest payments on securities held by the CSRDF and the proceeds of maturing securities.

By law, the CSRDF will be made whole once the debt limit is increased. Benefits for retired and disabled Federal employees will not be affected by this action and will continue to be paid. Once the United States has exhausted the extraordinary measures it has available to preserve lawful borrowing authority without exceeding the debt limit, however, the U.S. Government will be limited in its ability to make payments across the government.

Yes, in the past 20 years, Treasury used these extraordinary measures during previous debt limit impasses in 1996, 2002, 2003, 2004, 2006, 2011, 2012, 2013, 2014, and 2015.

Government Securities Investment Fund (G Fund)

The G Fund is a money market defined-contribution retirement fund for Federal employees.

The G Fund is invested in special-issue Treasury securities, which count against the debt limit. The entire balance matures daily and is ordinarily reinvested. In 1987, Congress granted Treasury the statutory authority to suspend reinvestment of all or part of the balance of the G Fund when the Secretary determines that the Fund cannot be fully invested without exceeding the debt limit.

By law, the G Fund will be made whole once the debt limit is increased. Federal retirees and employees will be unaffected by this action.

Yes, in the past 20 years, Treasury used this extraordinary measure during previous debt limit impasses in 1996, 2002, 2003, 2004, 2006, 2011, 2012, 2013, 2014, and 2015.

Note : The Bureau of the Fiscal Service maintains this FAQ. Keep in mind that these questions may not fit all situations and are only intended as a guideline.

Assignment Of Debt

Jump to section, what is an assignment of debt.

Assignment of debt is an agreement that transfer debt, rights, and obligations from a creditor to a third party. Assignment of debt agreements are commonly found when a creditor issues past due debt to a debt collection agency. The original lender will be relieved of all obligations and the agency will become the new owner of the debt. Debt assignment allows creditors to improve liquidity by reducing their financial risk. If a creditor has taken on a large amount of unsecured debt, an assignment of debt agreement is a quick way to transfer some of the unsecured loans to another party.

Common Sections in Assignments Of Debt

Below is a list of common sections included in Assignments Of Debt. These sections are linked to the below sample agreement for you to explore.

Assignment Of Debt Sample

Reference : Security Exchange Commission - Edgar Database, EX-10 19 ex107.htm ASSIGNMENT OF DEBT AND SECURITY , Viewed October 25, 2021, View Source on SEC .

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Public Debt: Overview

Last updated on December 29, 2023 by ClearIAS Team

Debt can be simply understood as the amount owed by the borrower to the lender. The total financial obligations of the public sector make up a nation’s gross government debt, also known as public debt or sovereign debt. Read here to learn about public debt, debt instruments, and debt management as well.

The financial market where investors may purchase and sell debt instruments of different forms and attributes is generally referred to as the “debt market.”

Government borrowing over time is mostly due to prior shortfalls in the budget. When a government’s expenses exceed its receipts, a deficit results. Both domestic and foreign people may be subject to government debt.

The sum is counted against the nation’s external debt if it is owed to citizens of another country.

Also read: US Debt Ceiling Crisis and US Federal Government Shut down Explained

Table of Contents

Debt instruments

A debt instrument is an asset that provides the lender (investor), a fixed income on the asset from the borrower. The lender receives the principal back in due course along with interest payments.

The Reserve Bank of India has allowed the following bodies to issue debt instruments in India:

Central and State Governments
Municipal Corporations
Government agencies
Public Sector Units

Types of Debt Instruments in India

The debt market in India is one of the largest in Asia and broadly consists of government securities (G-Secs), including central and state government securities and bonds issued by corporations.

Debt products available include bonds, Certificates of Deposit, Commercial Papers, Debentures, National Savings Certificates, Government Securities, Fixed Deposits, and more.

Government bonds:

These are issues by central or state governments.
These bonds act as a loan wherein the government borrows money from investors at a predetermined interest rate for a specific period.
Government bonds fall under the broad category of government securities (G-secs) and are issued under the supervision of the Reserve Bank of India.
The interest rate offered on the government bond, also known as the coupon rate, can be either fixed or floating.

Debentures:

Companies issue debentures to raise funds by borrowing money from the public.
The company thus promises to pay fixed interest to the investors.
These debt instruments may or may not be backed by any specific security or collateral. Hence, the investors have to rely on the credit ratings of the issuing company as security.

Fixed deposits:

Fixed deposits (FDs) are one of the most popular investment products as they are versatile and flexible.
Banks, certain Non-Banking Finance Companies (NBFCs), and even post offices issue fixed deposits.
They are popular due to their ease of investment, liquidity (except in tax-saving FDs), and uncomplicated nature.

Debt mutual funds:

Debt Mutual funds invest the pooled money in fixed-income products like government securities, corporate bonds, and some part in money market instruments.
Debt funds, also known as fixed-income funds, are considered less volatile than equity funds as they invest in fixed-income products. They also have a low-cost structure.

Certificates of deposit

Certificates of Deposit (CDs), introduced in India in 1989, are short-term debt instruments.
Banks and Financial Institutions issue CDs in dematerialized form against the funds that an investor deposits for a specific term.
The Reserve Bank of India lays down guidelines from time to time for their issue and operation.
Banks must maintain the cash reserve ratio (CRR) and statutory liquidity ratio (SLR) on the price of CDs.
All individual residents in India are eligible to buy certificates of deposit. The minimum duration of a CD issued by a bank is seven days and goes up to one year

Public provident fund:

The Public Provident Fund (PPF) scheme is a popular long-term investment product. PPFs have been around since 1968.
In this investment option, you put aside a small sum of money regularly to create wealth in the long term.
Interest rates are fixed by the government quarterly. And the Investment and returns are tax-exempt.

Public debt

Public debt is the total amount borrowed by the government of a country when the government’s revenue from taxes and other sources falls short of its spending requirements.

In India, public debt includes the total liabilities of the Union government that have to be paid from the Consolidated Fund of India (Article 292).

It is further classified into internal & external debt. Internal debt is categorized into marketable and non-marketable securities.

Marketable government securities include G-secs and T-Bills issued through auction.
Non-marketable securities include intermediate treasury bills issued to state governments and special securities issued to national Small Savings Fund among others.

Sometimes, the term is also used to refer to the overall liabilities of the central and state governments.

However, the Union government clearly distinguishes its debt liabilities from those of the states.
It calls the overall liabilities of both the Union government and state General Government Debt (GGD) or Consolidated General Government Debt.

The internal debt comprises loans raised in the open market.

It also includes borrowings through treasury bills including treasury bills issued by state governments, commercial banks, and other investors.
It also includes non-negotiable, non-interest-bearing rupee securities issues to international financial institutions.

The part of a nation’s debt that is borrowed from foreign lenders, such as commercial banks, governments, or international financial institutions, is referred to as its external debt.

These loans must typically be repaid in the currency used to make the loan, plus any applicable interest.
The borrowing nation may sell and export items to the lending nation to get the required cash.

The amount of the government’s debt is crucial since a sizable portion of annual payments (around 25%) are made merely to cover the interest on the previous debt. For the current fiscal year, the government’s debt is predicted to be about 62% of GDP.

The debt-to-GDP ratio shows how probable it is that the nation will be able to pay off its debt. Investors frequently use the debt-to-GDP ratio to determine the capacity of the government to finance its debt. Global economic crises have been fueled by higher debt-to-GDP ratios.

Public debt management

Sovereign or public debt management is the process of establishing and executing a strategy for managing the government’s debt to raise the required amount of funding.

It aims to achieve its risk and cost objectives and to meet any other sovereign debt management goals the government may have set, such as developing and maintaining an efficient market for government securities.

In 2015, the creation of a statutory body called Public Debt Management Agency (PDMA) was envisaged in India.

As the RBI set interest rates and conducted the purchase and sale of government bonds, it raised issues of conflict of interest.
Till the time a PDMA comes into place, the government created an interim arrangement that deals with the management of public debt called the Public Debt Management Cell.

Public Debt Management Cell

Public Debt Management Cell is an interim arrangement before setting up an independent and statutory debt management agency namely the Public Debt Management Agency (PDMA).

PDMC has the following advisory functions to the Government:

Plan borrowings of the Government, including market borrowings, other domestic borrowings, SGBs
Manage Central Government’s liabilities including NSSF, and contingent liabilities.
Monitor cash balances of the Government, improve cash forecasting, and promote efficient cash management practices.
Advise other Divisions in DEA on matters related to External Debt involving external borrowings through MI, Bilateral cooperation, and other possible sources, in terms of cost, tenure, currency, hedging requirements, etc., and monitor developments in foreign exchange markets.
Foster a liquid and efficient market for Government securities
Develop interfaces with various stakeholders/agencies in the regulatory/financial architecture etc. to carry out assigned functions efficiently.
Advice on matters related to investment and capital market operations.
Undertake research work related to new product development, market development, risk management, debt sustainability assessment, other debt management functions, etc.
Develop a database system for collecting and maintaining a comprehensive database of Government of India liabilities on a near real-time basis and shall be responsible for the publication of relevant information.
Carry out Preparatory work for independent PDMA.

An excessive level of public debt can result in higher interest rates, which has a crowding effect on the amount of private investment in the economy and the rate of economic expansion as a whole.

Although it temporarily boosts overall demand, if left unchecked it can cause a country’s economy to experience spiraling losses.

-Article written by Swathi Satish

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May 3, 2023 at 9:06 pm

In the topic about treasury bills, it is mentioned that even state governments can issue treasury bills, which I belive is wrong, kindly check and confirm.

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How Does Debt Assignment Work?

Chloe Meltzer | December 07, 2023

Legal Expert Chloe Meltzer, MA

Chloe Meltzer is an experienced content writer specializing in legal content creation. She holds a degree in English Literature from Arizona State University, complemented by a Master’s in Marketing from California Polytechnic State University-San Luis Obispo.

Edited by Hannah Locklear

Editor at SoloSuit Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Summary: What are your options when your debt has been assigned to a debt collector? Find out why a creditor might have assigned your debt and how to deal with it.

Debt assignment refers to a transfer of debt. This includes all of the associated rights and obligations, as it goes from a creditor to a third party. Debt assignment is essentially the legal transfer of debt to a debt collector (or debt collection agency). After this agency purchases the debt, they will have the responsibility to collect the debt, meaning you will pay your debt to them.

File a response with SoloSuit to win against debt collectors.

Find Out How Debt Assignment Works

When a creditor or lender no longer wants to be responsible for attempting to collect your debt, they will sell your debt to a third party. When this occurs, a Notice of Assignment (NOA) is sent out to you. This should inform you of who is responsible for collecting the rest of your loan or debt.

Legally you must be notified if your debt is assigned to someone new. This is to ensure that you know where to make payments to. If you are not aware of the new assignment, you may send payments to the wrong location which could force you into unintentional default.

Know How the FDCPA Protects You

Third-party debt collectors must act according to the Fair Debt Collection Practices Act (FDCPA). This federal law restricts the methods by which a debt collector can contact you, and attempt to collect debts. The FDCPA regulates the time of day or night a collector can make contact, how often they can call, as well as what they say and how they say it.

If you believe that a debt collector has violated the FDCPA, then you may be able to file a suit against that company. You may also be able to sue for damages or attorney fees.

Stand up to debt collection agencies with SoloSuit.

Learn Why a Creditor Assigns Debt

There are a few reasons why a creditor may assign your debt. Typically, the most common reason is to reduce their risk. By assigning and selling the debt it is no longer their liability. They can ensure they recoup some of their money, and appease investors as well.

Discover How Purchasing a Debt Differs from Debt Assignment

The purchase of debt occurs before assignment. Before the assignment of delinquent debt, a collection agency will be required to purchase it. This is often done at a far lower price, while they still attempt to recoup the entire debt. Because of this, it allows you to attempt to settle your debt for less.

Understand Why Debt Assignment Is Often Criticized

The process of assigning debt is often seen as unethical. With threats, harassment, and lies of all kinds, many debt buyers have been accused of violating the FDCPA. Because of this, debt assignment has seen a good amount of criticism. Some cases have even seen consumers charged with debts that have already been settled or paid .

Nevertheless, this shows how important it is to be on top of your debts. The number one choice you should make with any debt or debt assignment is to respond to all correspondence. This will ensure that you stay in compliance, and act when you need to.

What is SoloSuit?

SoloSuit makes it easy to respond to a debt collection lawsuit.

How it works: SoloSuit is a step-by-step web-app that asks you all the necessary questions to complete your answer. Upon completion, you can either print the completed forms and mail in the hard copies to the courts or you can pay SoloSuit to file it for you and to have an attorney review the document.

Respond with SoloSuit

"First time getting sued by a debt collector and I was searching all over YouTube and ran across SoloSuit, so I decided to buy their services with their attorney reviewed documentation which cost extra but it was well worth it! SoloSuit sent the documentation to the parties and to the court which saved me time from having to go to court and in a few weeks the case got dismissed!" – James

>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate

>>Read the NPR story on SoloSuit: A Student Solution To Give Utah Debtors A Fighting Chance

How to Answer a Summons for debt collection in all 50 states

Here's a list of guides on how to respond to a debt collection lawsuit in each state:

The Ultimate 50 State Guide

Connecticut
Massachusetts
Mississippi
New Hampshire
North Carolina
North Dakota
Pennsylvania
Rhode Island
South Carolina
South Dakota
Vermont ; Vermont (Small Claims court)
West Virginia

Guides on how to resolve debt with every debt collector

Are you being sued by a debt collector? We’re making guides on how to resolve debt with each one.

11 Charter Communications
AAA Collections
Aargon Agency Inc
Absolute Resolutions Investments LLC
ACEI Collections
Account Services
Accredited Collection Services
Advanced Recovery Systems
AFNI Collections
Alco Capital Group LLC
Aldous and Associates
Alliance Collections
Alliance One
Alliant Capital Management
Alpha Recovery Corp
Alltran Financial
Alltran Health
Alorica Inc.
Amcol Clmbia in Court
American Coradius International
American Profit Recovery
American Recovery Service
Americollect
AmSher Collection Services
Apelles LLC
AR Resources
ARC Collections
ARM Solutions
Arrow Financial Services
ARS National Services
ARSC Debt Collectors
AscensionPoint Recovery Services
Asset Acceptance LLC
Asset Recovery Solutions
Associated Credit Services
Atlantic Credit and Finance
Atradius Collections
Automated Collection Services, Inc.
Autovest LLC
AWA Collections
Balekian Hayes
Bay Area Receivables
BCA Financial Services
BC Services
Benuck and Rainey
Berlin-Wheeler
Bluebonnet Financial LLC
Bonneville Collections
Bull City Financial
Bureaus Investment Group
Caine and Weiner
Capio Partners
Capital Accounts
Capital Collections
Capital Management Services
Carmel Financial/New Coast Direct
Cavalry SPV I LLC
CBCS Collections
CBV Collections
CCB Credit Services
CCS Collections
CCS Offices
Central Mediation Services
Central Portfolio Control
Cerastes LLC
Choice Recovery
Choice Recovery Inc
CKS Financial
CKMS Financial
Client Services
CMRE Financial Services
Coast Professional
Comenity Bank Debt Collection
Commonwealth Financial
ConServe Debt Collection
Consumer Collection Management
Contract Callers Inc
Convergent Healthcare Recoveries
Convergent Outsourcing
Couch Conville & Blitt
Covington Credit
Credco in Court
Credence Resource Management
Credit Bureau Systems
Credit Control Corporation
Credit Management Company
Credit Management LP
Credit Systems
CTC Debt Collector
CVCS Debt Collection
Cypress Financial Recoveries
D&A Services
Daniels, Norelli, Cecere & Tavel P.C.
DCM Services
Debt Recovery Solutions
Delanor Kemper & Associates
Department Stores National Bank
Direct Recovery Associates
Discover Collections
Diversified Adjustment
Diversified Consultants
Diversified Recovery Bureau
DNF Associates, LLC
Dynamic Collectors
Eagle Accounts Group, Inc.
Eastern Account System
Ellington and Associates Collections
Encore Capital Group
Enerson Law
Enerson Law LLC
Enhanced Recovery Company
ERC Collections
ERSolutions
Estate Information Services
Equable Ascent Financial
Everest Business Funding
Executive Credit Management
Faber and Brand
Factual Data
Falls Collection Service
FCO Collections and Outsourcing
FIA Card Services
fin rec svc (Financial Recovery Services)
First Federal Credit Credit Control
First Financial Bank
First Portfolio Ventures LLC
First Progress
FirstPoint Collection Resources
Firstsource Advantage
FMA Alliance
Forster & Garbus
Franklin Collection Services
Freedom Plus
Freshview Solutions
Frontline Asset
Frost Arnett
Fulton Friedman & Gullace LLP
Galaxy International Purchasing, LLC
GC Debt Collection
GC Services
General Revenue Corporation
GLA Collections
Glass Mountain Capital
Glasser and Glasser
Global Credit Collection Corp
Global Trust Management
GMAC Financing
Golden 1 Credit Union
Grant and Weber
Grant Mercantile Agency
Gulf Coast Collection Bureau
Halsted Financial Services
Harris and Harris
Harvard Collection
Harvest Credit Management
Helvey and Associates
Hollis Cobb
Holloway Moxley
Hosto Buchan
Howard Lee Schiff
H&R Accounts
Hudson & Keyse LLC?
Hunter Warfield
Impact Receivables Management
Innovative Recovery
Integras Capital Recovery LLC
Javitch Block
JHPDE Finance 1 LLC
JP Receivables Management Partners
Kenneth Eisen and Associates
KeyBank student loans
Kirschenbaum, Phillips & Levy P.C.
KLS Financial Services
Kramer & Frank
Lakeside Collection
Lending Club
Lincoln and Morgan Kabbage
Linebarger Goggan Blair & Sampson LLP
Lockhart Collection Agency
LJ Ross Associates
LTD Collections
Malcolm S. Gerald and Associates
Malen & Associates
Mandarich Law Group
Mannbracken
Marcam Associates
MARS Inc. Collections
MCA Management Company
McCarthy, Burgess & Wolff
Meade & Associates
Mercantile Adjustment Bureau
Merchants Credit Association
MGM Collections
Michael J Adams PC
Midland Funding LLC
Mid-South Adjustment
Monarch Recovery
Monterey Financial
Moss Law Firm
Mountain Land Collections
MRS Associates
MSW Capital LLC
Mullooly, Jeffrey, Rooney & Flynn
Nathan and Nathan PC
National Collegiate Trust
National Credit Adjusters
National Credit Care
National Credit Systems
National Enterprise Systems
National Recovery Agency
National Recovery Solutions
Nationwide Credit
Nationwide Recovery Services
Nationwide Recovery Systems
NCO Financial Systems Incorporated
North American Recovery
Northland Group
Northstar Capital Acquisition
Northstar Location Services
NRC Collection Agency
Oliver Adjustment Company
Oliphant Financial, LLC
P&B Capital Group
PCB Collections Agency
Palisades Collection LLC
Pallida LLC
Paragon Contracting Services
Paragon Revenue Group
Payday Loan Debt Collectors
Pendrick Capital Partners
Penn Credit
Perdue Brandon
Persolve LLC
Phillips & Cohen Associates
Phoenix Financial Services
Pioneer Credit Recovery
PRA Group, Inc.
Pressler, Felt & Warshaw LLP
Prestige Services, Inc.
Prince Parker and Associates
Professional Finance Company
Progressive Management Systems
Provest Law
Quaternary Collection Agency
RAB Collection Agency
Rash Curtis and Associates
Radius Global SOL
Radius Global Solutions
Rawlings Company
Razor Capital
Real Time Resolutions
Receivables Performance Management
Regents and Associates
Reliant Capital Solutions
Resurgent Capital Services and LVNV Funding
Revco Solutions
Revenue Enterprises LLC
Revenue Group
RGS Financial, Inc.
RMP LLC in Court
RMP Services
RS Clark and Associates
RTR Financial Services
Rubin & Rothman
Salander Enterprises LLC
Samara Portfolio Management
SCA Collections
Scott Parnell and Associates
Second Round Collections
Second Round Sub LLC
Selip & Stylianou LLP
Sequium Asset Solutions
Sessoms and Rogers
Sherman Acquisition
Sherman Financial Group
SIMM Associates
Source Receivables Management
Southern Management Systems
Southwest Credit Group
Spire Recovery Solutions
SRS Company
Stark Collection Agency
State Collection Service
Stenger and Stenger
Stillman Law Office
Summit Account Resolution
Sunrise Credit Services
Superlative RM Debt Collector
Suttell and Hammer
Synergetic Communication
Synerprise Consulting
The Law Office of Michael J Scott
Trellis Company
Troy Capital
TRS Recovery Services
Tulsa Teachers Credit Union
UCB Collection
Unifin Debt Collector
Universal Credit Services
US Bank Collections
USAA collections
USCB America
Valentine and Kebartas
Valley Servicing
Vance & Huffman LLC
Van Ru Credit Corporation
Velo Law Office
Velocity Investments
Viking Client Services
Wakefield and Associates
Waypoint Resource Group
Weinberg and Associates
Weltman, Weinberg & Reis
Westwood Funding
Williams and Fudge
Wilshire Consumer Credit
Wolpoff & Abramson
Worldwide Asset Purchasing
www.AutomotiveCredit.com
Zarzaur & Schwartz
Zwicker & Associates

Resolve your debt with your creditor

Some creditors, banks, and lenders have an internal collections department. If they come after you for a debt, Solosuit can still help you respond and resolve the debt. Here’s a list of guides on how to resolve debt with different creditors.

American Express ; American Express – Debt Collection
Bank of America
Best Buy Credit Card
Capital One
Credit One Bank
Old Navy Credit Card
PayPal Synchrony Card
Regional Finance
Retailers National Bank
Reunion Student Loan Finance Corporation
SYNCB/PPEXTR
Synchrony Bank
Synchrony Walmart Card
Target National Bank
Wells Fargo
Can I Pay My Original Creditor Instead of a Debt Collection Agency?
Can I Settle a Debt with the Original Creditor?

Settle your medical debt

Having a health challenge is stressful, but dealing medical debt on top of it is overwhelming. Here are some resources on how to manage medical debt.

Am I Responsible for My Spouse's Medical Debt?
Do I Need a Lawyer for Medical Bills?
Do I Need a Lawyer to Fight Medical Bill Debt?
Does Bankruptcy Clear Medical Debt?
How Much Do Collection Agencies Pay for Medical Debt?
How to Find Medical Debt Forgiveness Programs
Is There a Statute of Limitations on Medical Bills?
Medical Debt Statute of Limitations by State
Summoned to Court for Medical Bills — What Do I Do?
Summoned to Court for Medical Bills? What to Do Next

Guides on arbitration

If the thought of going to court stresses you out, you’re not alone. Many Americans who are sued for credit card debt utilize a Motion to Compel Arbitration to push their case out of court and into arbitration.

Below are some resources on how to use an arbitration clause to your advantage and win a debt lawsuit.

How Arbitration Works
How to Find an Arbitration Clause in Your Credit Agreement
How to Make a Motion to Compel Arbitration
How to Make a Motion to Compel Arbitration in Florida
How to Make a Motion to Compel Arbitration Without an Attorney
How Credit Card Arbitration Works
Sample Motion to Compel Arbitration

Stop calls from debt collectors

Do you keep getting calls from an unknown number, only to realize that it’s a debt collector on the other line? If you’ve been called by any of the following numbers, chances are you have collectors coming after you, and we’ll tell you how to stop them.

1-800-390-7584
800-289-8004
800-955-6600
877-366-0169
877-591-0747
800-278-2420
800-604-0064
800-846-6406
877-317-0948
888-899-4332
888-912-7925
202-367-9070
502-267-7522

Federal debt collection laws can protect you

Knowing your rights makes it easier to stand up for your rights. Below, we’ve compiled all our articles on federal debt collection laws that protect you from unfair practices.

15 USC 1692 Explained
Does the Fair Credit Reporting Act Work in Florida?
FDCPA Violations List
How to File an FDCPA Complaint Against Your Debt Collector (Ultimate Guide)
How to Make a Fair Debt Collection Practices Act Demand Letter
How to Submit a Transunion Dispute
How to Submit an Equifax Dispute
How to Submit an Experian Dispute
What Debt Collectors Cannot Do — FDCPA Explained
What Does Account Information Disputed by Consumer Meets FCRA Requirements Mean?
What does “meets FCRA requirements” mean?
What does FCRA stand for?
What is the Consumer Credit Protection Act

Get debt relief in your state

We’ve created a specialized guide on how to find debt relief in all 50 states, complete with steps to take to find relief, state-specific resources, and more.

Debt collection laws in all 50 states

Debt collection laws vary by state, so we have compiled a guide to each state’s debt collection laws to make it easier for you to stand up for your rights—no matter where you live.

Debt Collection Laws in Alabama
Debt Collection Laws in Alaska
Debt Collection Laws in Arizona
Debt Collection Laws in Arkansas
Debt Collection Laws in California
Debt Collection Laws in Colorado
Debt Collection Laws in Connecticut
Debt Collection Laws in Delaware
Debt Collection Laws in Florida
Debt Collection Laws in Georgia
Debt Collection Laws in Hawaii
Debt Collection Laws in Kansas
Debt Collection Laws in Idaho
Debt Collection Laws in Illinois
Debt Collection Laws in Indiana
Debt Collection Laws in Iowa
Debt Collection Laws in Kentucky
Debt Collection Laws in Louisiana
Debt Collection Laws in Massachusetts
Debt Collection Laws in Michigan
Debt Collection Laws in Minnesota
Debt Collection Laws in Mississippi
Debt Collection Laws in Missouri
Debt Collection Laws in Montana
Debt Collection Laws in Nebraska
Debt Collection Laws in Nevada
Debt Collection Laws in New Hampshire
Debt Collection Laws in New Jersey
Debt Collection Laws in New Mexico
Debt Collection Laws in New York
Debt Collection Laws in North Carolina
Debt Collection Laws in North Dakota
Debt Collection Laws in Ohio
Debt Collection Laws in Oklahoma
Debt Collection Laws in Oregon
Debt Collection Laws in Pennsylvania
Debt Collection Laws in Rhode Island
Debt Collection Laws in South Carolina
Debt Collection Laws in South Dakota
Debt Collection Laws in Tennessee
Debt Collection Laws in Texas
Debt Collection Laws in Vermont
Debt Collection Laws in Virginia
Debt Collection Laws in Washington
Debt Collection Laws in West Virginia
Debt Collection Laws in Wisconsin
Debt Collection Laws in Wyoming

Statute of limitations on debt state guides

Like all debt collection laws, the statute of limitations on debt varies by state. So, we wrote a guide on each state’s statutes. Check it out below.

Statute of Limitations on Debt Collection by State (Best Guide)

Statute of Limitations on Debt Collection in Alabama
Statute of Limitations on Debt Collection in Alaska
Statute of Limitations on Debt Collection in Arizona
Statute of Limitations on Debt Collection in Arkansas
Statute of Limitations on Debt Collection in California
Statute of Limitations on Debt Collection in Connecticut
Statute of Limitations on Debt Collection in Colorado
Statute of Limitations on Debt Collection in Delaware
Statute of Limitations on Debt Collection in Florida
Statute of Limitations on Debt Collection in Georgia
Statute of Limitations on Debt Collection in Hawaii
Statute of Limitations on Debt Collection in Illinois
Statute of Limitations on Debt Collection in Indiana
Statute of Limitations on Debt Collection in Iowa
Statute of Limitations on Debt Collection in Kansas
Statute of Limitations on Debt Collection in Louisiana
Statute of Limitations on Debt Collection in Maine
Statute of Limitations on Debt Collection in Maryland
Statute of Limitations on Debt Collection in Michigan
Statute of Limitations on Debt Collection in Minnesota
Statute of Limitations on Debt Collection in Mississippi
Statute of Limitations on Debt Collection in Missouri
Statute of Limitations on Debt Collection in Montana
Statute of Limitations on Debt Collection in Nebraska
Statute of Limitations on Debt Collection in Nevada
Statute of Limitations on Debt Collection in New Hampshire
Statute of Limitations on Debt Collection in New Jersey
Statute of Limitations on Debt Collection in New Mexico
Statute of Limitations on Debt Collection in New York
Statute of Limitations on Debt Collection in North Carolina
Statute of Limitations on Debt Collection in North Dakota
Statute of Limitations on Debt Collection in Oklahoma
Statute of Limitations on Debt Collection in Oregon
Statute of Limitations on Debt Collection in Oregon (Complete Guide)
Statute of Limitations on Debt Collection in Pennsylvania
Statute of Limitations on Debt Collection in Rhode Island
Statute of Limitations on Debt Collection in South Carolina
Statute of Limitations on Debt Collection in South Dakota
Statute of Limitations on Debt Collection in Tennessee
Statute of Limitations on Debt Collection in Texas
Statute of Limitations on Debt Collection in Utah
Statute of Limitations on Debt Collection in Vermont
Statute of Limitations on Debt Collection in Virginia
Statute of Limitations on Debt Collection in Washington
Statute of Limitations on Debt Collection in West Virginia
Statute of Limitations on Debt Collection in Wisconsin
Statute of Limitations on Debt Collection in Wyoming

Check the status of your court case

Don’t have time to go to your local courthouse to check the status of your case? We’ve created a guide on how to check the status of your case in every state, complete with online search tools and court directories.

Alabama Court Case Search—Find Your Lawsuit
Alaska Court Case Search — Find Your Lawsuit
Arizona Court Case Search - Find Your Lawsuit
Arkansas Court Case Search — Find Your Lawsuit
California Court Case Search- Find Your Lawsuit
Colorado Court Case Search — Find Your Lawsuit
Connecticut Case Lookup — Find Your Court Case
Delaware Court Case Search — Find Your Lawsuit
Florida Court Case Search — Find Your Lawsuit
Georgia Court Case Search — Find Your Lawsuit
Hawaii Court Case Search — Find Your Lawsuit
Idaho Court Case Search – Find Your Lawsuit
Illinois Court Case Search — Find Your Lawsuit
Indiana Court Case Search — Find Your Lawsuit
Iowa Court Case Search — Find Your Lawsuit
Kansas Court Case Search — Find Your Lawsuit
Kentucky Court Case Search — Find Your Lawsuit
Louisiana Court Case Search — Find Your Lawsuit
Maine Court Case Search — Find Your Lawsuit
Maryland Court Case Search — Find Your Lawsuit
Massachusetts Court Case Search — Find Your Lawsuit
Michigan Court Case Search — Find Your Lawsuit
Minnesota Court Case Search — Find Your Lawsuit
Mississippi Court Case Search — Find Your Lawsuit
Missouri Court Case Search — Find Your Lawsuit
Montana Court Case Search — Find Your Lawsuit
Nebraska Court Case Search — Find Your Lawsuit
Nevada Court Case Search — Find Your Lawsuit
New Hampshire Court Case Search — Find Your Lawsuit
New Jersey Court Case Search—Find Your Lawsuit
New Mexico Court Case Search - Find Your Lawsuit
New York Case Search — Find Your Lawsuit
North Carolina Court Case Search — Find Your Lawsuit
North Dakota Court Case Search �� Find Your Lawsuit
Ohio Court Case Search — Find Your Lawsuit
Oklahoma Court Case Search — Find Your Lawsuit
Oregon Court Case Search — Find Your Lawsuit
Pennsylvania Court Case Search — Find Your Lawsuit
Rhode Island Court Case Search — Find Your Lawsuit
South Carolina Court Case Search — Find Your Lawsuit
South Dakota Court Case Search — Find Your Lawsuit
Tennessee Court Case Search — Find Your Lawsuit
Texas Court Case Search — Find Your Lawsuit
Utah Court Case Search — Find Your Lawsuit
Vermont Court Case Search — Find Your Lawsuit
Virginia Court Case Search — Find Your Lawsuit
Washington Court Case Search — Find Your Lawsuit
West Virginia Court Case Search — Find Your Lawsuit
Wisconsin Court Case Search — Find Your Lawsuit
Wyoming Court Case Search — Find Your Lawsuit

How to stop wage garnishment in your state

Forgot to respond to your debt lawsuit? The judge may have ordered a default judgment against you, and with a default judgment, debt collectors can garnish your wages. Here are our guides on how to stop wage garnishment in all 50 states.

Stop Wage Garnishment in Alabama
Stop Wage Garnishment in Alaska
Stop Wage Garnishment in Arizona
Stop Wage Garnishment in Arkansas
Stop Wage Garnishment in California
Stop Wage Garnishment in Colorado
Stop Wage Garnishment in Connecticut
Stop Wage Garnishment in Delaware
Stop Wage Garnishment in Florida
Stop Wage Garnishment in Georgia
Stop Wage Garnishment in Hawaii
Stop Wage Garnishment in Idaho
Stop Wage Garnishment in Illinois
Stop Wage Garnishment in Indiana
Stop Wage Garnishment in Iowa
Stop Wage Garnishment in Kansas
Stop Wage Garnishment in Kentucky
Stop Wage Garnishment in Louisiana
Stop Wage Garnishment in Maine
Stop Wage Garnishment in Maryland
Stop Wage Garnishment in Massachusetts
Stop Wage Garnishment in Michigan
Stop Wage Garnishment in Minnesota
Stop Wage Garnishment in Mississippi
Stop Wage Garnishment in Missouri
Stop Wage Garnishment in Montana
Stop Wage Garnishment in Nevada
Stop Wage Garnishment in New Hampshire
Stop Wage Garnishment in New Jersey
Stop Wage Garnishment in New Mexico
Stop Wage Garnishment in New York
Stop Wage Garnishment in North Carolina
Stop Wage Garnishment in North Dakota
Stop Wage Garnishment in Ohio
Stop Wage Garnishment in Oklahoma
Stop Wage Garnishment in Oregon
Stop Wage Garnishment in Pennsylvania
Stop Wage Garnishment in Rhode Island
Stop Wage Garnishment in South Carolina
Stop Wage Garnishment in South Dakota
Stop Wage Garnishment in Tennessee
Stop Wage Garnishment In Texas
Stop Wage Garnishment In Utah
Stop Wage Garnishment in Vermont
Stop Wage Garnishment in Virginia
Stop Wage Garnishment in Washington
Stop Wage Garnishment in West Virginia
Stop Wage Garnishment in Wisconsin
Stop Wage Garnishment in Wyoming

Other wage garnishment resources

Bank Account Garnishment and Liens in Texas
Can I Stop Wage Garnishment?
Can My Wife's Bank Account Be Garnished for My Debt?
Can Payday Loans Garnish Your Wages?
Can pensions be garnished?
Can Private Disability Payments Be Garnished?
Can Social Security Disability Be Garnished?
Can They Garnish Your Wages for Credit Card Debt?
Can You Stop a Garnishment Once It Starts?
Guide to Garnishment Limits by State
How Can I Stop Wage Garnishments Immediately?
How Long Before a Creditor Can Garnish Wages?
How Long Does It Take to Get Garnished Wages Back?
How to Fight a Wage Garnishment
How to Prevent Wage Garnishment
How to Stop a Garnishment
How to Stop Social Security Wage Garnishment
How to Stop Wage Garnishment — Everything You Need to Know
New York Garnishment Laws – Overview
Ohio Garnishment Laws — What They Say
Wage Garnishment Lawyer
What Is Wage Garnishment?

How to settle a debt in your state

Debt settlement is one of the most effective ways to resolve a debt and save money. We’ve created a guide on how to settle your debt in all 50 states. Find out how to settle in your state with a simple click and explore other debt settlement resources below.

How to Settle a Debt in Alabama
How to Settle a Debt in Alaska
How to Settle a Debt in Arizona
How to Settle a Debt in Arkansas
How to Settle a Debt in California
How to Settle a Debt in Colorado
How to Settle a Debt in Delaware
How to Settle a Debt in Florida
How to Settle a Debt in Hawaii
How to Settle a Debt in Idaho
How to Settle a Debt in Illinois
How to Settle a Debt in Indiana
How to Settle a Debt in Iowa
How to Settle a Debt in Kansas
How to Settle a Debt in Kentucky
How to Settle a Debt in Louisiana
How to Settle a Debt in Maryland
How to Settle a Debt in Massachusetts
How to Settle a Debt in Michigan
How to Settle a Debt in Minnesota
How to Settle a Debt in Mississippi
How to Settle a Debt in Missouri
How to Settle a Debt in Montana
How to Settle a Debt in Nebraska
How to Settle a Debt in Nevada
How to Settle a Debt in New Hampshire
How to Settle a Debt in New Jersey
How to Settle a Debt in New Mexico
How to Settle a Debt in New York
How to Settle a Debt in North Carolina
How to Settle a Debt in North Dakota
How to Settle a Debt in Ohio
How to Settle a Debt in Oklahoma
How to Settle a Debt in Oregon
How to Settle a Debt in Pennsylvania
How to Settle a Debt in South Carolina
How to Settle a Debt in South Dakota
How to Settle a Debt in Tennessee
How to Settle a Debt in Texas
How to Settle a Debt in Utah
How to Settle a Debt in Vermont
How to Settle a Debt in Virginia
How to Settle a Debt in West Virginia
How to Settle a Debt in Wisconsin
How to Settle a Debt in Wyoming

How to settle with every debt collector

Not sure how to negotiate a debt settlement with a debt collector? We are creating guides to help you know how to start the settlement conversation and increase your chances of coming to an agreement with every debt collector.

American Express
Capitol One
Cavalry SPV
Midland Funding
Moore Law Group
Navy Federal
NCB Management Services
Portfolio Recovery

Other debt settlement resources

Best Debt Settlement Companies
Can I Settle a Debt After Being Served?
Can I Still Settle a Debt After Being Served?
Can You Settle a Warrant in Debt Before Court?
Debt Management vs. Debt Settlement
Debt Settlement Pros and Cons
Debt Settlement Scam
Do I Need to Hire a Debt Settlement Lawyer?
Do You Need a Debt Settlement Attorney in Houston Texas?
Do You Owe Taxes on Settled Debt?
Here’s a Sample Letter to Collection Agencies to Settle Debt
How Can I Settle My Credit Card Debt Before Going to Court?
How Do I Know if a Debt Settlement Company Is Legitimate?
How Long Does a Lawsuit Take to Settle?
How Much Do Settlement Companies Charge?
How I Settled My Credit Card Debt With Discover
How to Make a Debt Settlement Agreement
How to Make a Settlement Offer to Navient
How to Negotiate a Debt Settlement with a Law Firm
How to send Santander a settlement letter
How to Settle Debt for Pennies on the Dollar
How to Settle Debt in 3 Steps
How to Settle Debt with a Reduced Lump Sum Payment
How to Settle a Credit Card Debt Lawsuit — Ultimate Guide
How to Settle Credit Card Debt When a Lawsuit Has Been Filed
If You Are Using a Debt Relief Agency, Can You Settle Yourself with the Creditor?
Largest Debt Settlement Companies
Should I Settle a Collection or Pay in Full?
Summary of the Equifax Data Breach Settlement
The Advantages of Pre-Settlement Lawsuit Funding
The FTC Regulates Debt Settlement Through the Telemarketing Sales Rule
The Pros and Cons of Debt Settlement
What Happens if I Reject a Settlement Offer?
What Happens if You Don't Pay a Debt Settlement?
What Happens When You Settle a Debt?
What Is A Debt Settlement Agreement?
What is Debt Settlement?
What Percentage Should I Offer to Settle Debt?
What to Ask for in a Settlement Agreement
Who Qualifies for Debt Settlement?
Will Collection Agencies Settle for Less?
5 Signs of a Debt Settlement Scam

Personal loan and debt relief reviews

We give a factual review of the following debt consolidation, debt settlement, and loan organizations and companies to help you make an informed decision before you take on a debt.

Accredited Debt Relief Debt Settlement Reviews
Advance America Loan Review
ACE Cash Express Personal Loan Review
BMG Money Loan Review
BMO Harris Bank Review: Pros and Cons
Brite Solutions Debt Settlement Reviews
Caliber Home Loans Mortgage Review
Cambridge Debt Consolidation Review
Campus Debt Solutions Review
CashNetUSA Review
Century Debt Settlement Reviews
ClearPoint Debt Management Review
Click N Loan Reviews
CuraDebt Debt Settlement Review
CuraDebt Reviews: Debt Relief Assistance For California Residents
Debt Eraser Review
Debtconsolidation.com Debt Settlement Reviews
Eagle One Debt Settlement Reviews
Freedom Debt Relief Debt Settlement Reviews
Global Holdings Debt Settlement Reviews
Golden 1 Credit Union Personal Loan Review
Honda Financial Services Review
iLending Reviews
Infinite Law Group Debt Settlement Reviews
JG Wentworth Debt Settlement Reviews
LoanMart Reviews
Mastriani Law Firm Review
Milestone ® Mastercard ® Review
ModoLoan Review
Money Management International Reviews
M&T Mortgage Company Review
National Debt Relief Debt Settlement Reviews
New Era Debt Settlement Reviews
OppLoans Review
Pacific Debt Relief Reviews
Palisade Legal Group Debt Settlement Reviews
PCG Debt Consolidation Review
PenFed Auto Loan Review
Priority Plus Financial Reviews
Roseland Associates Debt Consolidation Review
SDCCU Debt Consolidation Review
Speedy Cash Loans Review
Symple Lending Reviews
Tripoint Lending Reviews
TurboDebt Debt Settlement Reviews
Turnbull Law Group Debt Settlement Reviews
United Debt Settlement Reviews
Upgrade Auto Loans Reviews

How to repair and improve your credit score

Debt has a big impact on your credit. Below is a list of guides on how to repair and improve your credit, even while managing major debt.

3 Ways to Repair Your Credit with Debt Collections
5 Pros and Cons of Credit Cards & How to Use Them Wisely
6 Reasons Your Credit Score Isn't Going Up
Bankruptcy vs Debt Settlement: Which is Better for Your Credit Score?
Does Debt Consolidation Hurt Your Credit Score?
Does Wage Garnishment Affect Credit?
Guide to Disclosing Income on Your Credit Card Application
How Long Does It Take to Improve My Credit Score After Debt Settlement?
How Often Does Merrick Bank Increase Your Credit Limit?
How to fix your credit to buy a house
How to Handle Debt and Improve Credit
How to Raise My Credit Score 40 Points Fast
If I Settle with a Collection Agency, Will It Hurt My Credit?
Is 600 a Good Credit Score?
Obama Credit Card Debt Relief Program – How to Use It
Sample credit report dispute letter
Should I Use Credit Journey?
Understanding myFICO: Your Gateway to Better Credit
What Does "DLA" Mean on a Credit Report?
What Is A Good Credit Score For Businesses?
What is American Credit Acceptance?
What is CBNA on my credit report?
What is CreditFresh?
Who Made the Credit Score?
Why is THD/CBNA on my credit report?

How to resolve student loan debt

Struggling with student debt? SoloSuit’s got you covered. Below are resources on handling student loan debt.

Budgeting Strategies for Students: How to Manage Your Finances Wisely
Can You Go to Jail for Not Paying Student Loans?
Can You Settle Student Loan Debt?
Do Student Loans Go Away After 7 Years? (2022 Guide)
Do You Need a Student Loan Lawyer? (Complete Guide)
Does Student Debt Die With You?
How to Manage a Student Debt
How to Get Rid of Student Loan Debt
Mandatory Forbearance Request Student Loan Debt Burden
Negative Economic Effects of Student Loan Debt on the US Economy
Pros and Cons of Taking a Student Loan
Regional Adjustment Bureau Student Loans – How to Win
The Real Impact of Student Debt: How Our Brains Handle It
Why It's Important to Teach Students How to Manage Debt
5 Alternatives to Taking a Student Loan
5 Tips for Students: How to Create a Realistic and Effective Budget
7 College Financial Planning Tips for Students
7 Things to Consider When Taking a Student Loan
7 Tips to Manage Your Student Loans

Civil law legal definitions

You can represent yourself in court. Save yourself the time and cost of finding an attorney, and use the following resources to understand legal definitions better and how they may apply to your case.

Accleration Clause — Definition
Adjuster - Defined
Adverse Action — Definition
Affidavit — A Definition
Annulment vs. divorce – what's the difference?
Anticipatory Repudiation — Definition
Bench Trial — Defined
Certificate of Debt: A Definition
Commuted Sentence – Definition
Constructive Eviction - Defined
Constructive Discharge - Definition
Defendant - Definition and Everything You Need to Know
Demurred – Definition
Dischargeable - Definition
Disclosures — Definition
False Imprisonment Defined
Good Faith Exception – Definition
Hearsay — A Definition
HOEPA – Definition
Implied Contract – Definition
Injunctive Relief — A Definition
Intestate–Defined
Irrevocable Agreement — Defined
Joint Custody–Defined
Litigator — A Definition
Mediation - Definition
Medical Malpractice — Definition
Mistrial — A Definition
Mitigating Circumstances — Definition
Motion for Summary Judgment — Definition
Nolle Prosequi – Definition
Nunc Pro Tunc — A Definition
Plaintiff - Definition and Everything You Need to Know
Pro Se - Defined
Probable Cause Hearing — Definition
Restitution – Definition
Sole Custody-Defined
Statute of Limitations—Definition and Everything You Need to Know
Summons—Definition
Tenancy in Common – Defined
Time Is of the Essence – Definition
What Is the Bankruptcy Definition of Consumer Debt?
Wrongful Termination–Defined

Get answers to these FAQs on debt collection

Am I Responsible for My Husband's Debts If We Divorce?
Am I Responsible for My Parent's Debt if I Have Power of Attorney?
Can a Collection Agency Add Fees on the Debt?
Can a Collection Agency Charge Interest on a Debt?
Can a Credit Card Company Sue Me?
Can a Debt Collector Freeze Your Bank Account?
Can a Debt Collector Leave a Voicemail?
Can a Debt Collector Take My Car in California?
Can a Judgment Creditor Take my Car?
Can a Process Server Leave a Summons Taped to My Door?
Can an Eviction Be Reversed?
Can Credit Card Companies Garnish Your Wages?
Can Credit Cards Garnish Wages?
Can Debt Collectors Call From Local Numbers?
Can Debt Collectors Call You at Work in Texas?
Can Debt Collectors Call Your Family?
Can Debt Collectors Leave Voicemails?
Can I Pay a Debt Before the Court Date?
Can I Rent an Apartment if I Have Debt in Collection?
Can I Sue the President for Emotional Distress?
Can the SCRA Stop a Default Judgment?
Can the Statute of Limitations be Extended?
Can You Appeal a Default Judgement?
Can You Get Unemployment if You Quit?
Can You Go to Jail for a Payday Loan?
Can You Go to Jail for Credit Card Debt?
Can You Negotiate with Westlake Financial?
Can You Record a Call with a Debt Collector in Your State?
Can You Serve Someone with a Collections Lawsuit at Their Work?
Can You Sue Someone Who Has Filed Chapter 7 Bankruptcy?
Capital One is Suing Me – How Can I Win?
Debt Snowball vs. Debt Avalanche: Which One Is Apt for You?
Do 609 Letters Really Work?
Do Debt Collectors Ever Give Up?
Do I Have Too Much Debt to Divorce My Spouse?
Do I Need a Debt Collection Defense Attorney?
Do I Need a Debt Negotiator?
Do I Need a Legal Coach?
Do I Need a Payday Loans Lawyer?
Does a Living Trust Protect Your Assets from Lawsuits?
Does Chase Sue for Credit Card Debt?
Does Debt Consolidation Have Risks?
Does Midland Funding Show Up to Court?
How Can I Get Financial Assistance in PA?
How do Debt Relief Scams Work?
How Do I Find Out If I Have Any Judgments Against Me?
How Do I Get Rid of a Judgment Lien on My Property?
How Do I Register on the Do Not Call List?
How Does a Flex Loan Work?
How Does Debt Affect Your Ability to Buy a Home?
How Does Finwise Bank Work?
How does Navy Credit debt forgiveness work?
How Does Payments.tsico Work?
How Important is it to Protect your Assets from Unexpected Events?
How is Debt Divided in Divorce?
How Long Do Creditors Have to Collect a Debt from an Estate?
How long do debt collectors take to respond to debt validation letters?
How Long Does a Judgement Last?
How Long Does a Judgment Last?
How Long Does a Levy Stay on a Bank Account?
How Long Does an Eviction Stay on Your Record?
How Many Calls from a Debt Collector is Considered Harassment?
How Many Times Can a Judgment Be Renewed in North Carolina?
How Many Times Can a Judgment be Renewed in Oklahoma?
How Much Do Collection Agencies Pay for Debt?
How Much Do You Have to Be in Debt to File Chapter 7?
How Much Does College Actually Cost?
How Often Do Credit Card Companies Sue for Non-Payment?
How Should You Respond to the Theft of Your Identity?
I am being sued because my identity was stolen - What do I do?
If a Car is Repossessed Do I Still Owe the Debt?
Is Debt Forgiveness Taxable?
Is Freedom Debt Relief a Scam?
Is it Legal for Debt Collectors to Call Family Members?
Is it Smart to Consolidate Debt?
Is LVNV Funding a Legitimate Company? - Them in Court
Is My Case in the Right Venue?
Is Portfolio Recovery Associates Legit? — How to Win
Is Severance Pay Taxable?
Is SoloSuit Worth It?
Is Someone with Power of Attorney Responsible for Debt After Death?
Is the NTB Credit Card Safe?
Is There a Judgment Against Me Without my Knowledge?
Is transworld systems legitimate? — How to win in court
Liquidate–What Does it Mean?
Litigation Finance: Is it a Good Investment?
Received a 3-Day Eviction Notice? Here's What To Do
Should I File Bankruptcy Before or After a Judgment?
Should I Hire a Civil Litigation Attorney?
Should I Hire a Civil Rights Lawyer?
Should I Hire a Litigation Attorney?
Should I Marry Someone With Debt?
Should I Pay Off an Old Apartment Debt?
Should I Send a Demand Letter Before a Lawsuit?
Should I Use My IRA to Pay Off Credit Card Debt?
Should You Communicate with a Debt Collector in Writing or by Telephone?
Should You Invest in Stocks While In Debt?
Subsidized vs. Unsubsidized Loans: Which is Better?
The Truth: Should You Never Pay a Debt Collection Agency?
What are the biggest debt collector companies in the US?
What are the different types of debt?
What Bank Is Behind Best Buy's Credit Card?
What Bank Issues Kohl's Credit Card?
What Bank Owns Old Navy Credit Card?
What Credit Bureau does Aqua Finance Use?
What Credit Bureau Does Truliant Use?
What Does “Apple Pay Transaction Under Review” Mean?
What Does a Debt Collector Have to Prove in Court?
What Does BAC Stand For?
What does HAFA stand for?
What Does Payment Deferred Mean?
What Does Reaffirmation of Debt Mean?
What Happens After a Motion for Default Is Filed?
What Happens at a Motion for Summary Judgment Hearing?
What Happens If a Defendant Does Not Pay a Judgment?
What Happens If a Process Server Can't Serve You?
What Happens if a Tenant Wins an Eviction Lawsuit?
What Happens If Someone Sues You and You Have No Money?
What Happens If You Avoid Getting Served Court Papers?
What Happens If You Don’t Pay Speedy Cash?
What Happens If You Ignore a Debt Collector?
What Happens If You Never Answer Debt Collectors?
What Happens When a Debt Is Sold to a Collection Agency
What Happens When a Debt Is Sold to a Collection Agency?
What If a Summons Was Served to the Wrong Person?
What If an Order for Default Was Entered?
What if I default on an Avant payment?
What If the Wrong Defendant Is Named in a Lawsuit?
What Is a Case Number?
What is a Certificate of Judgment in Ohio?
What Is a Certificate of Service?
What Is a Civil Chapter 61 Warrant?
What is a Civil Litigation Lawyer?
What Is a Consent Judgment?
What Is a CPN Number?
What Is a Debt Brokerage?
What Is a Debt-to-Sales Ratio?
What Is a Defamation Lawsuit?
What is a default judgment?— What do I do?
What Is a Libel Lawsuit?
What is a Lien on a House?
What is a Lien Release on a Car?
What is a Lien?
What Is a Motion to Strike?
What Is a Motion to Suppress?
What Is a Non-Dischargeable Debt in Tennessee?
What Is a Nonsuit Without Prejudice?
What Is a Preliminary Hearing?
What Is a Reaffirmation Agreement?
What Is a Request for Dismissal?
What Is a Rule 3.740 Collections Defense in California?
What Is a Slander Lawsuit?
What is a Stipulated Judgment?
What Is a Warrant in Debt?
What is ABC Financial Club Charge?
What is ACS Ed Services?
What is Advanced Call Center Technologies?
What is Alimony?
What Is Allied Interstate's Phone Number?
What is an Affirmative Defense?
What Is an Assignment of Debt?
What Is an Attorney Malpractice Lawsuit?
What Is an Unlawful Detainer Lawsuit?
What is Bank of America CashPro?
What is Bitty Advance?
What Is Celtic Bank?
What is Consumer Portfolio Services?
What Is Credence Resource Management?
What Is Debt Internment?
What Is Discover's 60/60 plan?
What is Evading the Police?
What Is Extinguishment of Debt?
What is First Investors Financial Services?
What is Global Lending Services?
What is homicide?
What Is Lexington Law Firm?
What is LGFCU Personal Loan?
What is Moral Turpitude?
What is Online Information Services?
What is Oportun?
What Is Service of Process in Texas?
What is sewer service?
What Is Summary Judgment?
What is Synchrony Bank's Hardship Program?
What Is T-Mobile's Phone Number for Debt Collection?
What Is the Amount of Money You Still Owe to Their Credit Card Company Called?
What is the Deadline for a Defendant's Answer to Avoid a Default Judgment?
What Is the Formula for Calculating Closing Costs?
What Is the Minimum Amount That a Collection Agency Will Sue For?
What Is the Phone Number for IQ Data?
What is the Purpose of the Truth in the Lending Act?
What is the status of my case?
What Is the Statute of Limitations on Debt in Washington?
What is the Telemarketing Sales Rule?
What is Unsecured Credit Card Debt?
What is WCTCB?
What is WFDS?
What is WUVISAAFT?
What is Zombie Debt, and How Do I Deal With It?
What Personal Property Can Be Seized in a Judgment?
What Should I Do If Crown Asset Management Suing Me?
What Should I Do If OneMain Financial Is Taking Me to Court?
What Should You Do if You Can't Pay Your Mortgage?
What states require a professional licensing number for debt collectors?
When Does Exeter Finance Repo Cars?
When Is My Rent Due Legally?
Where’s My Amended Tax Return?
Which Bank Does Macy's Credit Card Use?
Who is EOSCCA?
Who is Over the Loan Forgiveness Program at KHESLC?
Who is Synchrony Bank? — Beat Them in Court
Who is Jefferson Capital Systems LLC — How to win in court
Why Being Judgment Proof Is Not a Defense to a Lawsuit
Why Can't Lawyers Give Legal Advice?
Who is Synchrony Bank? — Them in Court
Why Do Debt Collectors Block Their Phone Numbers?
Why Do Lawyers Charge So Much?
Why Is the Sheriff Looking for Me?
Why Would a Sheriff Come to My House with Papers?
Will Bankruptcy Stop a Judgment?

How-to debt guides

How to Beat Westlake Portfolio Management
How to Access Free Debt Relief
How to Answer a Lawsuit for Debt Collection
How to Appear in Court by Phone
How to Apply For Unemployment Benefits in Florida
How to Avoid Getting Served
How to Beat a Bill Collector in Court
How to Beat a Debt Collector in Court
How to Beat a Lawsuit From a Debt Collector
How to Cancel a Merrick Bank Credit Card
How to Cancel an American Eagle Credit Card: A Step-by-Step Guide
How to Cancel JCPenney Credit Card
How to Deal with Debt Collectors
How to decide what to do next in a lawsuit
How to Defend Yourself in Court
How To Develop A Debt Repayment Plan That Works
How to Discharge a Debt with UCC
How to Dispute a Debt and Win
How to Dispute a False Positive Drug Test
How to dispute a rental collection
How to Drag Out an Eviction
How to Fight a Motion for Relief From Automatic Stay
How to Fight an Eviction
How to Fight Debt Collectors in Court and Win
How to File a Civil Answer in Kings County Supreme Court
How to File a Civil Answer With the Duval Clerk of Courts - Florida
How to File a Motion to Extend Time
How to File a Motion to Satisfy Judgment in Utah
How to File a Motion to Set Aside Judgment
How to File Chapter 13 Without an Attorney
How to File in Bergen County Superior Court
How to File in Deschutes County Circuit Court
How to File in Josephine County Courthouse
How to File in Miamisburg Municipal Court
How to File in Monmouth County Courthouse
How to File in Oak Grove Courthouse
How to File in Oregon Small Claims Court
How to File in Small Claims Court in Iowa
How to File in the Houston County Superior Court
How To Fill Out the PLD-C-001
How to Find My Bridgecrest Login
How to Find Out If You're Being Sued
How to Find Out What Collection Agency Owns Your Debt
How to Find the Attorney That is Suing You (Secret)
How to get a case dismissed without prejudice on statute of limitations
How to Get a Divorce in Florida
How to Get Credit Card Debt Relief
How to Get Debt Relief (Ultimate 50 State Guide 2023)
How to Get Out of a Bridgecrest Loan
How to get out of a RISE loan
How to Get Out of Debt Before Retirement
How to Get Out of Paying HOA Dues
How to Get Relief From a Gambling Debt
How to Hire a Mediator
How to Identify Age Discrimination in the Employment Act
How to identify fake and abusive debt collectors
How to Liquidate Credit Cards Into Cash
How to liquidate your assets to pay off debt
How to Make a 609 Letter That Really Works
How to Make a Debt Validation Letter - The Ultimate Guide (2023)
How to Make a Motion to Dismiss
How to Make a Motion to Lift Stay
How to Make a Motion to Vacate Judgment
How to Make a Will
How to Make an Eviction Appeal
How to Make Motion to Set Aside — Ultimate Guide
How to Negotiate a Lien on a House
How to Negotiate Credit Card Debts
How to Paramount Recovery
How To Pay for College and Avoid Debt
How to Pay off Your Destiny Credit Card
How to Perform Voluntary Repossession
How to Protect Your LLC with a Registered Agent Service
How to Recover from a Negative Bank Balance
How to Report the Cancellation of a Debt on a 1040
How to Respond to a Debt Collection Summons in Wyoming
How to Respond to a Debt Lawsuit vs United Collection Bureau
How to Respond to a Lawsuit Against Northstar Location Services
How to Respond to a Sheriff's Note On Your Door
How to respond to a Summons from VanSlam, Inc
How to Respond to Plaintiff's Counsel
How To Respond to Request for Admission
How to Satisfy a Judgment
How to Spot Common IRS Scams
How to Stop Eviction Lawyers
How to Stop Pinnacle Collections Agency
How to Support Employees With Debt – HR Solution
How to Use a Bonus to Solve Your Financial Problems
How to Travel Without Falling into Debt: Embracing the "Workcation"
How to Use King County Superior Court Electronic Filing
How to Use Montgomery County E-Filing
How to use My.Loanbuilder
How to Use the Doctrine of Unclean Hands
How to Walk Away from Credit Card Debt
How to Win a Citibank Debt Lawsuit
How to Win a Collect Pros Dispute
How to Win a Credit One Bank Lawsuit
How to Win a Debt Lawsuit Against Security Credit Services
How to Win a Freedom Debt Relief Lawsuit
How To Win a Mariner Finance Lawsuit
How to Win a Portfolio Recovery Associates Debt Lawsuit
How to Win When Sued by Blitt & Gaines
How to Win When Sued by Pharia LLC
How to Win When You're Sued by Paragon Revenue Group
How to Write a Hardship Letter
How to Write a Re-Aging Debt Letter

Learn more with these additional debt resources

A Comprehensive Guide to Business Loans in the U.S.
Bar Associations for All 50 States
Bank of America Is Suing Me For Credit Card Debt — How to win
Best Debt Consolidation Strategies
Biggest Debt Collection Agencies (2023)
Budgeting for Language Learning: Tips for Language Enthusiasts in Debt
BYU Personal Finance Online Course (How to Get Back on Track After a Debt Lawsuit)
Collection Agencies Phone Numbers
Cómo resolver una deuda
Cómo responder a una demanda civil por deuda
Countersuing a Company: A Step-By-Step Guide
Credit Card Debt Forgiveness Act Explained
Credit Card Debt Forgiveness Because of Disability
Credit Repair Scam
Debt Collection Ageny List (2022)
Debt Collection Attorneys Near Me
Debt Collection Litigation Industry Report 2023
Debt Relief Programs 2023
Debt Validation Letter Template
Debt-Free Strategies: Leveraging Cash Value Life Insurance to Achieve Financial Freedom
Defending Yourself in Court Against a Debt Collector
Difference Between a Trial and a Hearing
Do This If You're Sued by Express Recovery for Debt
Don't Make a Payment to Arnold Scott Harris
Everything You Need to Know About Getting Divorced
Forging a Path to Debt-Free College: Innovative Approaches to Financing Your Higher Education
Free Legal Aid in Bullhead City, Arizona
Free Legal Aid in Marion, Ohio
Fruit of the Poisonous Tree
Going to Court for Credit Card Debt - Everything You Need to Know
Going to Court for Credit Card Debt — Key Tips
Guide to Elderly Debt Collection Laws
Hearing Vs. Trial
Help! A Debt Collector Is Calling My Work
Help! I'm Being Sued by My Debt Collector
Here Is Ocwen's Mailing Address
Here's the Phone Number for Colinfobur (a Debt Collector)
Hours of Service Violations - 10 Effects
How a CPA Can Save Your Small Business Money
How Attorney Contingency Fees Work
How Credit Counseling and Financial Education Can Help You Manage Debt
How Debt Affects Mental Health
How Do You Demonstrate Financial Hardship?
How Eviction Works for Renters
How I Won My Credit Card Debt Lawsuit (Interview)
How Legal Billing Software Streamlines Trust Fund Management
How Not to Pay a Judgment
How the Consumer Financial Protection Bureau Debt Collection Rule Applies to You
How VPNs Protect Your Financial Privacy and Assist in Debt Relief
I Got Sued Because of Credit Card Fraud—How I Beat American Express in Court
I'm in Debt With No Job and No Money — What to Do
Importance of Identity Verification for Buy Now Pay Later Providers
Interview With A Former Debt Collector
Is Zombie Debt Still a Problem in 2019
Kentucky Debt Collection Laws — What You Need to Know
Lawsuit Deadline Calculator (The best one!)
Legal Aid in All 50 States
Legal Aid in the US Ultimate Guide (2022)
Legal Support Services for Debt Collection
Liquidated Debt vs. Unliquidated Debt
Living Trust vs. Will—Which One You Need
Luxury on a Budget: 10 Ways to Have Luxury Experiences While Managing Debt
Make Solomon and Solomon PC validate a debt
Make Stephen Einstein validate a debt
Massachusetts Debt Collection Laws – What They Say
Money Management Tips for Senior Citizens
Motion for Default Judgment - Everything You Need to Know
My Bank Account is Negative $1,000 — Fix it
National Debt Relief Screwed Me — What to Do Next
Navigating Your Finances Wisely: A Look at the Best Credit Cards of 2023
New Debt Collection Laws 2022
Nonsuit vs Dismissal in a Debt Collection Lawsuit
Oregon Eviction Laws - What They Say
Overcoming College Debt Challenges: Top Strategies for Financial Freedom
Plaintiff vs Defendant — What's the difference
Pro Se Meaning
Q&A How to Resolve Your Debt Lawsuit (April 19, 2023)
Q&A: How to Resolve Your Debt Lawsuit (July 12, 2023)
Q&A: How to Resolve Your Debt Lawsuit (July 26, 2023)
Q&A: How to Resolve Your Debt Lawsuit (June 21, 2023)
Q&A: How to Resolve Your Debt Lawsuit (June 7, 2023)
Q&A: How to Resolve Your Debt Lawsuit (May 17, 2023)
Q&A: How to Resolve Your Debt Lawsuit (May 24, 2023)
Q&A: How to Resolve Your Debt Lawsuit | May 10, 2023
Q&A: Resolve Your Debt Lawsuit (May 3, 2023)
Read This if You're Being Evicted With Children
Resolve Your Collection Lawsuit in 3 Steps
Resolve Your Debt Lawsuit Q&A (March 29, 2023)
Resolve Your Debt With A Summons Response: A Step-by-Step Guide
Respond to A Rocket Receivables Collector
RICO Charge
Sample Answer to Summons for Credit Card Debt Lawsuit
Sample Cease and Desist Letter Against Debt Collectors
Sample Letter to Remove a Charge-Off from Your Credit Report
Sirote and Permutt Foreclosure - How to Win
SoloSuit FAQ
States Where You Can Go to Jail for Debt
Stop Paying Credit Card Debt and Stop Worrying About It
Successful Tips on Dealing With Debt Collectors During the Pandemic
Tax Debt Compromise Program Scam
Template Cease and Desist Letters to Debt Collectors
The 7 Signs You Need Debt Help
The best strategies for paying off credit card debt
The Eviction Moratorium by State
The Eviction Moratorium in Indiana Explained
The Future of Legal Document Automation: Trends and Predictions
The Impact of Debt on Your Psychological Well-being
The Legal and Compliance Aspects of GPS Tracking: Key Considerations for Employers
The Legal Process for Burn Injury Claims: What to Expect In California
The Pros and Cons of Chapter 13 Bankruptcy
The Pros and Cons of Using Real Estate to Generate Passive Income
The Ultimate Guide to Responding to a Debt Collection Lawsuit in Utah (2023)
Tips for Leaving the Country With Unpaid Credit Card Debt
Top 7 Debt Collector Scare Tactics
Top Side Hustles to Pay Off Debt
Trespassing
USC 15 Section 1662(b) Explained
Use MacBook and Tech to Protect Yourself From Debt Collectors Online
Use This 11 Word Phrase to Stop Debt Collectors
Use this Sample Answer to Summons for Credit Card Debt
Vermont Statute of Limitations on Debt
West Virginia Statute of Limitations on Debt
What Are the Phone Numbers for United Recovery Systems
What Happens After I File an Answer to My Debt Lawsuit?
What to Consider Before Signing a Stipulated Judgment, The Ultimate Guide
What to Do About a Disputed Debt
What to Do After Filing an Answer in a Debt Collection Lawsuit
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A key phase in Biden's new student-loan forgiveness plan has wrapped up, bringing borrowers one step closer to relief. But pushback is brewing.

The public comment period on Biden's new student-loan forgiveness plan is over.
This means borrowers are now one step closer to the relief, which is planned for the fall.
Still, opponents of the plan have threatened legal challenges, jeopardizing the relief's timeline.

Rachel, a Pennsylvania student-loan borrower, wants President Joe Biden's new debt cancellation plan to be implemented — and she wants the relief to be as broad as possible.

In a comment to the administration publicly available on the Federal Register, Rachel wrote that "the more student loan debt that can be forgiven the better."

She said her mom's student loans were forgiven last month, and during the over three-year student-loan payment pause, she was able to buy a home because she didn't have to pay her monthly student-loan bills.

"My loans are currently in repayment, and if that burden could be lifted it would be life-changing for me," she wrote.

Rachel is among the millions of federal student-loan borrowers contending with monthly bills again amid an uncertain time for relief. Biden's Education Department is working to implement a new debt relief plan after the Supreme Court struck down its first plan last summer .

The new plan — expected to benefit over 30 million borrowers — is focused on distinct categories for relief, including:

cancellation of unpaid interest of up to $20,000 ;
debt cancellation for borrowers who are eligible for — but have not yet enrolled in — relief under plans like Public Service Loan Forgiveness and income-driven repayment;
relief for borrowers who entered repayment at least 20 years ago;
and relief for borrowers who attended programs that left them with too much debt compared to post-grad earnings.

While a separate proposal for relief for borrowers experiencing financial hardship is expected to be unveiled in the coming months, the Education Department just concluded the public comment period for the other categories — meaning it is now one step closer to implementing the relief this fall.

But the road ahead isn't smooth. The department's proposal received a flood of negative comments, including a letter from 20 Republican state attorneys general who claimed the relief is unconstitutional.

"The least the American people should be able to expect is that people receiving debt cancelation actually apply for it and that the Department makes a determination on an individual basis," they wrote. "Instead, the Department is twisting the law to forgive as many loans as possible. This is wrong."

Where the challenges stand

The administration is required to adhere to the negotiated rulemaking process to implement this new student-loan forgiveness plan. That means it will now take into account all the comments it received on the plan, and it will decide whether to adjust its proposal or move toward implementation.

For now, the administration plans to begin implementing the relief this fall, coinciding with the presidential election . Should Biden win, relief efforts would continue, but former President Donald Trump would likely cease those efforts if he wins another term.

A host of Republican lawmakers have also called on the administration to rescind its proposed rule. Before the public comment period concluded, 130 of them signed onto a letter saying that "the Supreme Court has made it abundantly clear that there is zero authority to write-off federal student loans en masse last June when the Department's 'Plan A' was ruled unconstitutional."

In addition, experts previously told Business Insider that Biden is likely to face similar legal challenges to the ones he did the first time around when he attempted to cancel student debt using the HEROES Act of 2003. The HEROES Act allowed the education secretary to cancel student debt in connection to a national emergency, like the pandemic, which the Supreme Court ultimately ruled was unconstitutional.

Biden's administration is using the Higher Education Act this time, which does not require a national emergency. Still, Cary Coglianese, an administrative law professor at the University of Pennsylvania, previously told BI that Biden "is certainly still facing a very skeptical Supreme Court."

"Even though it's a different statute, it's still a skeptical Supreme Court," he said. "It's still a pretty big program even though it's a smaller one."

For now, all borrowers can do is continue to make their payments as they wait for debt relief — either through one of the administration's targeted efforts or the broader version set for the fall.

Have you gotten student-debt relief? Do you have loans and don't believe they should be forgiven? Reach out to this reporter at [email protected] .

Watch: Why student loans aren't canceled, and what Biden's going to do about it

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Debt Assignment: How They Work, Considerations and Benefits
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Public Debt & Its Instruments
Public debt, FRBM ACT & Concept of deficits
Unsecured Debt Remedy Using the Subject Access Request SAR

COMMENTS

Debt Assignment: How They Work, Considerations and Benefits
Debt Assignment: A transfer of debt, and all the rights and obligations associated with it, from a creditor to a third party . Debt assignment may occur with both individual debts and business ...
Public Debt: Meaning, Classification and Method of Redemption
Normally, public debt, by nature, is voluntary. But during emergencies (e.g., war, natural calamities, etc.,) government may force the nationals to lend it. Such loans are called forced or compulsory loans. v. Redeemable and Irredeemable Debt: Redeemable public debt refers to that debt which the government promises to pay off at some future date.
Guidelines for Public Debt Management
34. Government debt management requires staff with a combination of financial market skills (such as portfolio management and risk analysis) and public policy skills. Regardless of the institutional structure, the ability to attract and retain skilled debt management staff is crucial for mitigating operational risk.
I What Is Public Debt Management and Why Is It Important?
Abstract Sovereign debt management is the process of establishing and executing a strategy for managing the government's debt in order to raise the required amount of funding, achieve its risk and cost objectives, and to meet any other sovereign debt management goals the government may have set, such as developing and maintaining an efficient market for government securities.
PDF Government Debt Management: Designing Debt Management Strategies
world bank treasury public debt manageme nt advisory services 2 ©2017 The International Bank for Reconstruction and Development / The World Bank 1818 H Street NW Washington DC 20433/ Telephone: 202 -473-1000/ Internet: www.worldbank.org
Public debt
3 Public debt in history. States and sovereigns have long borrowed to mobilize resources to meet emergencies. Aristotle described how, in the fifth century BCE, Dionysius of Syracuse borrowed to finance military campaigns against the Carthaginians. 4 The English monarch Edward III (1312-1377) borrowed to continue the Hundred Years War with France. In the 1340s, with the arrival of the Black ...
PDF Public Debt Management Office: Main Functions, Skills Required and
This note describes the main functions of a DMO, the skills required to perform these functions, and offers suggestions on background and training for DMO staff. Transaction processing and recording. Financial reporting. IMF, World Bank "Guidelines for Public Debt Management", 2001, p2.
Managing Public Debt
Managing Public Debt. High-quality public debt management plays a critical role in reducing the vulnerability of developing countries to financial crises. With sound risk and cash management, effective coordination with fiscal and monetary policy, good governance, and adequate institutional and staff capacity in place, governments can develop ...
PDF Managing Public Debt: Formulating Strategies and Strengthening
public debt management (PDM) work program that was particularly focused on strengthening frameworks and capacity in low-income countries (LICs). This comprised three main elements: (i) develop a toolkit to help LICs formulate an effective Medium-Term Debt Management Strategy (MTDS) and apply it in 4-6 countries a year; (ii) undertake debt
PDF Guidelines for Public Debt Management: Accompanying Document and Selec
Debt managers in all of the case study countries emphasized the need to ensure that the public is fully informed about the government's financial condition, the objectives governing debt management, and the strategies and modalities used by debt managers to pursue these objectives. They also use a variety of communication vehicles, such as ...
Federal Debt: Total Public Debt as Percent of Gross Domestic Product
Units: Percent of GDP, Seasonally Adjusted Frequency: Quarterly Notes: Federal Debt: Total Public Debt as Percent of Gross Domestic Product (GFDEGDQ188S) was first constructed by the Federal Reserve Bank of St. Louis in October 2012. It is calculated using Federal Government Debt: Total Public Debt and Gross Domestic Product, 1 Decimal :
FAQs for the Public Debt
The Public Debt Outstanding represents the face amount or principal amount of Treasury marketable security and Treasury non-marketable securities currently outstanding. The Public Debt Subject to Limit is the maximum amount of money the Government is allowed to borrow without receiving additional authority from Congress.
Debt Assignment: Understanding the Mechanics, Risks, and ...
Debt assignment is a strategic maneuver in the financial landscape, involving the legal transfer of debt and associated rights from a creditor to a third party, often a debt collector. This process, utilized by creditors to enhance liquidity or mitigate risk exposure, demands a meticulous understanding. ...
Public Debt
Self-Selection Models in Corporate Finance* Li Kai, Nagpurnanand R. Prabhala, in Handbook of Empirical Corporate Finance, 2007. 8.5 Discussion. The public debt issue pricing area is interesting for the wide range of selection models employed. One issue, however, is that it is a little difficult to place the literature in perspective because the sources of self-selection modeled vary across papers.
Assignment Of Debt: Definition & Sample
Assignment of debt is an agreement that transfer debt, rights, and obligations from a creditor to a third party. Assignment of debt agreements are commonly found when a creditor issues past due debt to a debt collection agency. The original lender will be relieved of all obligations and the agency will become the new owner of the debt.
Public debt
public debt, obligations of governments, particularly those evidenced by securities, to pay certain sums to the holders at some future time.Public debt is distinguished from private debt, which consists of the obligations of individuals, business firms, and nongovernmental organizations.. A brief treatment of public debt follows. For full treatment, see government budget: Forms of public debt.
PDF Appendix Summary of the Debt Management Guidelines 1
1. Debt management objectives and coordination 1.1 Objectives The main objective of public debt management is to ensure that the government's financing needs and its payment obligations are met at the lowest possible cost over the medium to long run, consistent with a pru-dent degree of risk. 1.2 Scope Debt management should encompass the ...
Public Debt: Overview
Public debt. Public debt is the total amount borrowed by the government of a country when the government's revenue from taxes and other sources falls short of its spending requirements. In India, public debt includes the total liabilities of the Union government that have to be paid from the Consolidated Fund of India (Article 292).
The U.S. Sailed Past $1 T Quarterly Interest On The Public Debt
WASHINGTON, DC - JULY 05: Pedestrians walk past a poster displayed at 11th and E St's NW that ... [+] displays the current U.S. National debt at 32 Trillion dollars on July 05, 2023 in Washington ...
How Does Debt Assignment Work?
Debt assignment refers to a transfer of debt. This includes all of the associated rights and obligations, as it goes from a creditor to a third party. Debt assignment is essentially the legal transfer of debt to a debt collector (or debt collection agency). After this agency purchases the debt, they will have the responsibility to collect the debt, meaning you will pay your debt to them.
7 Critical Student Loan Forgiveness Dates In 2024 Borrowers ...
Importantly, borrowers who get out of default through either Fresh Start or Direct loan consolidation by the September 30 deadline could receive credit toward IDR student loan forgiveness all the ...
Federal Debt: Total Public Debt (GFDEBTN)
Graph and download economic data for Federal Debt: Total Public Debt (GFDEBTN) from Q1 1966 to Q4 2023 about public, debt, federal, government, and USA.
Interpretation of the Public Debt Clause
Fourteenth Amendment, Section 4: The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the ...
Biden-Harris Administration Announces Additional $7.7 Billion in
The Biden-Harris Administration announced today the approval of $7.7 billion in additional student loan debt relief for 160,500 borrowers. These discharges are for three categories of borrowers: those receiving Public Service Loan Forgiveness (PSLF); those who signed up for President Biden's Saving on a Valuable Education (SAVE) Plan and who are eligible for its shortened time-to-forgiveness ...
Federal Register :: Public Inspection: Agency Information Collection
If you are using public inspection listings for legal research, you should verify the contents of the documents against a final, official edition of the Federal Register. Only official editions of the Federal Register provide legal notice of publication to the public and judicial notice to the courts under 44 U.S.C. 1503 & 1507.
PDF Guidelines for Public Debt Management: Accompanying Document and ...
II.9.3. Amortization Profile of Domestic Debt (year end) 133 II.9.4. Ratio of Net Public External Debt to Total Export 134 II.9.5. Federal Government External Debt Amortization Profile, as of September 30, 2001 135 II.9.6. Agencies External Debt Amortization Profile, as of September 30, 2001 136 II.9.7. Percentage of Public External Debt 137 II ...
StateJobsNY
5. Be familiar with procedures involving acceleration, skip-tracing, credit checks and third-party agencies, and be aware of the requirements and restrictions of the Fair Debt Collection Practices Act (P.L. 95-109). 6. Assist with special projects and other duties as assigned.
PDF Guidelines Public Debt Management
GUIDELINES FOR PUBLIC DEBT MANAGEMENT I. WHAT IS PUBLIC DEBT MANAGEMENT AND WHY IS IT IMPORTANT? 1. Sovereign debt management is the process of establishing and executing a strategy for managing the government's debt in order to raise the required amount of finding, achieve its risk and cost objectives, and to meet any other sovereign debt management goals the
Biden administration announces additional $7.7 billion in student debt
The Biden administration announced the cancellation of an additional $7.7 billion in student loans for 160,000 Americans Wednesday in its ongoing efforts to relieve soaring college debt.
Where the challenges stand
May 26, 2024, 2:17 AM PDT. US President Joe Biden. Scott Olson/Getty Images. The public comment period on Biden's new student-loan forgiveness plan is over. This means borrowers are now one step ...