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Thread: Loan Debt

  1. #1
    Amateur
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    Default Loan Debt

    When I go to "Information" about my team, it says Loan Debt: 99 mil

    But I have 75 millions transfer budget.

    How do I pay my debt back?

  2. #2
    Reserves
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    You don't is the short answer.

    The board has agreed loans and a repayment schedule, sometimes they will pay part or all of the debt back ahead of schedule but this is fairly rare and only if you have enough money in the bank to do this.

    Also note that your transfer budget is not a separate pot of money it is the amount the board will allow you to spend on transfers from the bank account which may or may not leave you overdrawn.

  3. #3
    Third Team
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    Default

    It's also worth mentioning that irl there would be financial penalties for paying back the loan early, FM does not replicate this scenario or indeed to true nature of large corporate debt liabilities so you just keep to your agreed payment schedule.

  4. #4
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    this is one thing that has narken me about the game at times ... playing with Newcastle as my team and havign an outstanding debt owed around £130 m i've have over 300m in the bank at any one time... there should be an option to pay back the loan or part of the loan if you want to as a manager and then reduce the outgoings of the club on a weekly / monthly basis...... who wants to pay 500k a week for 40 years when you have the funds in the club coffers..

  5. #5
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    It normally doesn't make financial sense to pay back a loan. Think about it this way, you are paying, say 8% interest on your loan. Now if you can use that loan money to make more than an 8% profit, you are making money.

    That's really easy to do in FM, in that you can buy a player for 500k and sell him for 2m. That's 400% profit, over maybe 2-3 years.

    Of course, once you've got 300m in the bank the loan is largely irrelevant either way. But in theory businesses borrow money based on the assumption that the money they have now can be invested and bring returns that are larger than the interest payments. Just don't worry about the payments.

  6. #6
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    Quote Originally Posted by sjm View Post
    It normally doesn't make financial sense to pay back a loan. Think about it this way, you are paying, say 8% interest on your loan. Now if you can use that loan money to make more than an 8% profit, you are making money.

    That's really easy to do in FM, in that you can buy a player for 500k and sell him for 2m. That's 400% profit, over maybe 2-3 years.

    Of course, once you've got 300m in the bank the loan is largely irrelevant either way. But in theory businesses borrow money based on the assumption that the money they have now can be invested and bring returns that are larger than the interest payments. Just don't worry about the payments.
    I agree to a certain extent.. however the Newcastle loan is 0% ... bad unique example I know but its a loan from the owner at zero interest..... I still think it would be nice to have a dialogue with the chairman to offer it ... not havign played all clubs but i'm sure there will eb examples of smaller debts which take ages to pay off which could be wiped out quite quickly if the option was there.

  7. #7
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    Quote Originally Posted by bonna112 View Post
    I agree to a certain extent.. however the Newcastle loan is 0%
    All the more reason not to pay it back early then...

  8. #8
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    Quote Originally Posted by sjm View Post
    All the more reason not to pay it back early then...
    haha.. true.... I guess its just a personal preferance.... I hate debt ! whether its in game or real life... i try to pay it off asap....
    I still think it could be an option though... and like you said if you dont want to pay it then thats fine but people like myself could do it

  9. #9
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    Default

    IRL managers do not have the power and say so to deal with loans so it is good that you can not do anything about it, it is just annoying to have the loan there

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