Alright, I am with a club, and their payroll is -3.07K, now I keep trying to terminate contracts, but it requires money. Is this money taken from my transfer budget? Also, if my club HAS no transfer budget, can I terminate their contract still?
I usually try "the team needs money approach" under the transfer list options; some will agree. A lot of times they are reluctant to leave and you have to wait until the January window before anyone will take them even for free unless it's a really good player.
If you have a nasty side...
Make sure his status is set to first team. Wait until he has a remotely poor game and fine him two weeks pay - ignore his concerns and move him to the reserves. Wait another week and offer him a mutual termination. Some will get ticked off and want out right away. Others will fight you tooth and nail and hold out but they always cave after a while - just keep offering them mutual termination every two weeks.
This is not good strategy if you have iffy morale or the player has high influence and friends. Some will complain to the press but it never really seems to affect the team. Or you can just line up a friendly against a large team to pay for the severance fees.