Business, Legal & Accounting Glossary
Debt forgiveness refers to partial or complete forgiveness of debt. More commonly used term is debt relief. Debt forgiveness is frequently used to refer to Third World debt. Debt could be owed by organizations, individuals or by countries. In the 1990s a large number of NGOs and other organizations came together under the aegis of Jubilee 2000 to launch a campaign to advocate debt relief for indebted, underdeveloped and developing countries. Jubilee 2000 managed to motivate countries and major organizations like the International Monetary Fund and World Bank to favour debt forgiveness.
Personal debt is a major problem faced by US citizens and people of other nationalities. Some methods adopted as part of debt forgiveness include credit counselling, consolidation loans, debt settlement, money management and bankruptcy. Some experts feel that debt forgiveness carries certain negative effects.
Third World debt is a term used to identify all external debts owed by developing and underdeveloped countries in the world. Many of the Third World countries over-estimated their capability to collect enough tax money that could be utilized to pay off loans. This led to the development of Third World debt.
non-mortgage debt includes student loans, car loans, and credit cards. According to some estimates, average US household, non-mortgage debt amounts to $19,000.
Effective credit counselling helps an individual to avoid a situation where he or she may have to seek out debt relief. Counselling is done by finance professionals and firms with credible expertise in their area of work.
Some experts present many arguments against the practice of debt forgiveness. They argue that debt forgiveness can lead to complacency and motivate the debtor to seek out more loans, in hope that they will be waived off.
To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.
Definitions for Debt Forgiveness are sourced/syndicated and enhanced from:
This glossary post was last updated: 26th March, 2020 | 7 Views.