Comment by conductr

A debt holder can typically pay off their debt any time they want. I think what you're proposing is to pass along the discounted price to the debt holder. Eg. if the lender is going bankrupt and selling the debt for 30% of it's value, they should offer that purchase price to the debtor? There's really nothing prohibiting them from doing that, I don't see why a law needs to be changed for this to start taking place. It's just not a norm in business because bankruptcies and liquidations are easier/faster to conduct if you can move the assets in a single/few transactions. It also encourages default from the borrowing side.