Jump to content

Repaying Loans


Recommended Posts

This is something that has confused me and I don't know if I'm thinking about this wrongly but I havent seen anybody else mention this before.

For example, if the club I manage takes a loan out of 50 million and payments are made over 25 years.

Surely, after a year the club debt should then be 48 million rather than the original debt value that the club information screen would state.

Am I wrong, as I find this misleading on how much debt some clubs have?

Link to post
Share on other sites

This is something that has confused me and I don't know if I'm thinking about this wrongly but I havent seen anybody else mention this before.

For example, if the club I manage takes a loan out of 50 million and payments are made over 25 years.

Surely, after a year the club debt should then be 48 million rather than the original debt value that the club information screen would state.

Am I wrong, as I find this misleading on how much debt some clubs have?

Money going off in interest. Moreover keep a check on your spending too.

Link to post
Share on other sites

Regarding Interest though, football manager seems to display the original debt until the very last payment, by which point surely the debt isnt the same as the initial debt.

Using the same £50 million debt example, in the last year of payments it still displays £50 million despite only 2 million left to pay.

Surely you wouldnt be paying £48 million of interest on this 2 million.

I would of thought the debt should be the 2 million plus a years interest on 50 million at that point

Link to post
Share on other sites

That's not really your call, though. You are only the manager at the end of the day. The decision to payback the loan lies with the chairman/chief exec.

Yep, but by the same line of thought as board requests for building stadiums, improving facilities, etc, we should be able to at least ask them to payback the loan, or part of the loan. A little unrealistic to be giving our input on this (not more than asking them to build a freaking stadium), but sometimes it's baffling to look at cash just sitting there, and they won't get rid of the damn loan crippling the club.

Link to post
Share on other sites

I think it is reasonable in FM for the manager to 'suggest' to the Chairman that the clubs debt could be restructured or paid off if the club consistently turns a profit.

It has irked me for years that my Forest sides regularly make a profit and rather than pay off the loan, the Chairman pays (himself) an annual dividend.

Link to post
Share on other sites

It also depends on how the debt and re-payment schedule is structured, i.e. you have borrowed £50m and have to pay it back in 25 years time, but your actual repayments may not start for another 10 years, in which case you would pay nothing for 10 years then yearly repayments of £3,333,333.33 + interest (£50m divided by the remaining 15 years of the loan term).

This is of course a possible scenario in real life - I have no idea if this possibility is actually something that is programmed into the game.

Link to post
Share on other sites

This is similar to a morgage (effectly a loan) for 30 years. The first 15 years of the loan are for paying off the interest, meaning the amount borrowed hasnt changed. Untill after the 15 years, the payment on the morgage/loan is then being repaid, and should go down from that point onwards.

Link to post
Share on other sites

Archived

This topic is now archived and is closed to further replies.

  • Recently Browsing   0 members

    • No registered users viewing this page.
×
×
  • Create New...