A Dominican Monk by the name of Johann Tetzel entered the village as an ambassador of Pope Leo X, the head of the Roman Catholic Church. This was Tetzel's latest stop on a tour of selling "indulgences" for the Pope. An indulgence is a certificate which by papal authority promises the removal of punishment and suffering for sin. Leo authorized the selling of them to help raise money to pay for the completion of St. Peter's Basilica in Rome.
Since the middle ages the Roman Catholic Church has taught that while God alone can forgive the guilt of sin, He has left it to the church to forgive the temporal punishments which sin deserves. God removes the guilt and eternal punishment of the Christian's sins, but it is the responsibility of the church--and more specifically, the Pope--to remove the "temporal punishments" which those sins deserve. This is accomplished through an elaborate system of penance, purgatory and indulgence.
Fortunately, the Roman Catholic Church has a "treasury of merit" which holds the possibility of mitigating some or all of a believer's purgatorial sufferings. This treasury consists of the "over-and-above" good works that were done by Christ and unusually faithful men and women throughout history. The saints who performed works of "supererogation" (ie. more than they themselves needed to get out of purgatory and into heaven) have deposited their extra merit into this treasury. The Pope can disburse this accumulated merit as he determines to whom he determines. An indulgence, granted by the Pope, draws on this extra merit in order to reduce the number of years which the recipient must spend in purgatory before he is released to heaven.
The treasury of merit works something like a huge bank account held in trust, with the Pope being the sole trustee. If you owe a $10,000 debt and fulfill the application process, the Pope has the authority to draw on this account and grant to you enough money to pay your debt. Thus, based on the merits of others your sins are indulged and you can escape at least some of the punishments of purgatory.
This background makes more understandable the commotion and excitement which was caused by Tetzel when he entered into the town of Juterbock--especially since the indulgences which he came to sell were not mere partial ones but the plenary kind. Those who purchased his wares were guaranteed to skip purgatory altogether. Furthermore, these indulgences could be applied not only to the purchaser, but also for any dear, departed loved one who up to that point had been suffering the punishments of purgatory.
Tetzel was quite a showman and salesman. And he did all that he could to persuade his hearers to purchase indulgences. Part of his speech played upon the affections of his hearers toward their departed loved ones.
Indulgences have benefit not only for the living but for the dead. Priest, noble, merchant, wife, youth, young girl, do you not hear your parents and your other friends who are dead, and who cry from the bottom of the fiery inferno, "We are suffering horrible torments! An insignificant offering would deliver us; you can give it, and you will not."?
He even made up a little rhyme which went something like this: "As soon as the coin into the coffer rings, another soul into Heaven springs."
Tetzel was quite effective in convincing multitudes of people to give large sums of money to purchase these indulgences.