Well, not exactly. The debt is still there, they just can’t force you to pay it. Exceptions apply, like student loans, and they can probably still claim property in the case of bankruptcy or inheritance.
Ah, there it is, and that actually helps to answer the question. Assuming the Biblical God, canon states that God is love. So why would a perfect God, who is love, create a universe? It seems most likely to me that it would be so He can have an object of His love.
But what is love directed to something perfect and easy to love? That’s hardly a worthy effort. Might as well make something authentic. And since He isn’t just loving, but love itself, He might as well make it in such a way that He can carry out every aspect of love - love when they love you back, love when they turn away, love when they hate you, love when they don’t even think you exist, and so much more.
The universe must be filled with evil for half these situations to appear, but it’s not love to make someone evil. The solution? Free will. God made it so His creations were free to turn their backs on Him, but still, in love, He gave every warning against it, because separation from God is not only evil but death.