If they had debts, it's because someone lent them money (banks in this case it seems). This means they certainly had some form of income and credit rating.
And as for toys, this applies to the USA but is worth keeping in mind:
"In 2005, the typical household defined as poor by the government had a car and air conditioning. ... two color televisions, cable or satellite TV, a DVD player, and a VCR. ... an Xbox or a PlayStation.... microwave. ...clothes washer, clothes dryer, ceiling fans, a cordless phone, and a coffee maker." [source]
It doesn't mean that I want those things taken away from them, but it does mean that even poor people are not destitute (at least in North America).
There are plenty of poor people who play by the rules and live within their means. They share housing accommodations with friends or family. They sacrifice and scrimp and save to afford a better education and better job. To wipe out the debts of those who chose not to do this is a slap in the face to those who played by the rules. And it sends a terrible message to them.