When the letter came, Sonia Wignall didn’t believe it.

Why would she? Her debt was a stress-inducing albatross on her financial health and a stain on her credit rating. And, yes, she owed that $33,000 for a good reason, as she borrowed the money when she’d been forced to cut back on work to care for her dying father. But, really, who was going to parachute into her life and write a check?

The letter had an answer: The check came from ForgiveCo of Fort Collins, Colorado.

In an act that shines a light on the widespread burden of debt, ForgiveCo had purchased her debt — along with the debt of about 8,800 others in metro Atlanta. Then ForgiveCo partnered with California-based financial services company Earnin to pay it all off.

Wignall read the letter. Then she read it again.

“I thought, ‘I can’t believe this,’” said Wignall, who lives in Fayetteville, Georgia. “I thought maybe it was a scam. So, I called the company I owed money toe and they said, ‘No, you have no balance. Zero.’”

Craig Antico, ForgiveCo’s chief executive, said he founded the company in 2021 to induce that sense of delighted disbelief among some of the many millions of Americans living under the weight of debt.

“It’s a random act of kindness,” he said.

ForgiveCo partners with for-profit companies who supply the cash to pay off the debt. Those partners — in this case, Earnin — pay a small percentage to ForgiveCo for the privilege of doing some good while also burnishing their own reputations.

Thus far, about 50,000 people have had their debts paid that way.

In metro Atlanta, a total of $10,662,432 was paid off, Antico said. People were chosen at random, with just a few caveats. For instance, no recipient could be making $100,000 or more.

The median income of a recipient was $29,000, Antico said.

He said he founded the company after a long career on the other side of the aisle. He worked for the companies that buy up debt — typically for just a tiny percent of its original value — and then try to get debtors to pay them.

That effort can involve phone calls, letters and sometimes legal action — or threats of it.

“To me, this is like a mission,” Antico said. “I was in the collection industry for 30 years, and I hated it.”

Often, after someone has gone an extended time without paying off a debt, the company that is owed figures it’s better to get a fraction of the debt rather than an unpaid promise. Debt collection companies often buy the right to that debt, hoping they can convince the debtors to pay up.

So ForgiveCo arrives and offers to buy the debt from the collection company. The logic of selling is the same: They trade the promise of a future payoff for some cash right now.

That percentage — generally 2% — lets ForgiveCo make what it says is a modest profit. Afterward, the partner can do whatever public relations work it wants to publicize its good deed.

Antico’s not the only one who has decided to help cash-strapped households.

FreeRentATL is an Atlanta initiative that has been raising money toward the goal of paying the rent for a year of 25 local residents . Organizers cite figures that show that many renters are paying at least 40% of their income for housing. A September fundraiser for the group was hosted by former University of Georgia and Hawks star Dominique Wilkins and his wife, Jedidia.

For tens of millions of people, debt is chronic, even life-threatening. Researchers say people sometimes live too extravagantly for their income, but often it is an unplanned expense — a medical emergency, vehicle or home repairs, a natural disaster — that tips a household into the financial ditch. Sometimes it’s income loss — a layoff or demotion.

Many people are flirting with disaster, even if they seem to be getting by, said Frederick F. Wherry, principal investigator at Princeton University’s Debt Collection Lab, which studies and collects data on the issue. “You have a regular job and regular income and you buy a car and you have kids and sometimes you have to go to the doctor’s office,” he said. “If you are doing these regular things, you probably have debt.”

It can start with car loans, mortgages and credit cards, debts that quickly could go unpaid if a person loses income or has a sudden unexpected expense. And once debts are overdue, a consumer can be making payments that cover only interest charges and penalties and do not reduce the amount owed.

Some debtors end up in bankruptcy court, some lose homes or cars or a portion of their wages. Some manage to make deals with creditors — or the companies that buy the debts — to pay slowly or to pay just a portion of their debt.

The scope of the problem is hard to determine.

Some agencies track consumer delinquencies on credit cards, mortgages and auto loans. But many household crises fly under the radar, Wherry said.

“A lot of people are dealing with debt and doing it quietly,” he said. “They are being sued by collection companies or their wages are being garnished. And it’s being done quietly.”

Companies like ForgiveCo can only address a minuscule part of the problem.

American households hold roughly $17.8 trillion in debt, the Federal Reserve says.

“Debt is a trap,” said Dalié Jiménez, a professor of law and bankruptcy expert at the University of California-Irvine. The further behind consumers fall, the harder it is to escape without severe damage to their lives, said Jimenez, who is associated with the Debt College Lab. “Bankruptcy is essentially the only safety valve.”

Rachel Edmond of Marietta, Georgia, owed $5,000 to a rental furniture company. She’d owed for more than five years, paying regularly at first, then falling behind and getting demoralized as the interest began building up and making full payment increasingly hard to envision.

“With inflation and everything, it’s not easy to pay off debts,” Edmond said.

Having that debt tainted her credit. When she tried to buy a house, she couldn’t get a loan. This summer, she decided to make one last run at paying it off.

“I called the company to see about options and they said, ‘Oh, your debt was paid off,’ ” Edmond said. “I was not going to be able to believe it. I said, ‘Are you going to come back to me in three years? Is there going to be a lien on my property?’ ”

They said a company called Forgive had paid the $5,000.

“And it brought my credit score up,” Edmond said. “Now, I’m looking for a home because I can actually meet the credit criteria.

“I am very grateful for that.”

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