Loan default

If a country gives out loans, is there are risk of the borrowers defaulting? I want to ensure that my borrowers don't do bankrupt and sink my cash.

Not really any risk that I can tell.

I can tell you the cash you put out in loans is hardly gaining anything though. It seems odd that the interest is not charged on a game month basis..

The biggest risk I can see is doing what I did when I first started playing/ I thought I was rich, so I gave almost all my cash out in loans, but then I spent too much, got into some sort of an automatic buying spree on the military, and went into debt, negative cash - by the time I figured out the problem, I had to buy some GCs and buy cash with that to stay afloat until the loans came back.

OK. Thanks asurfaholic

yes, if the player quit the game or the world?

their is no risk to offering loans. in the past, their used to be a fee for having to much cash on hand, forcing players to offer the cash in loans, or take it out of the country. but that fee has been long forgotten.

there's still a 1.5% borrower's penalty to pay loan early, it's a punishment for doing well and paying off your loan early

how does a player pays your loan back if his country has negative cash and negative total assets?

if the borrower has some assets, will gm or game parameters automatically sell the player's asset to pay you back when your loan is due?

No like everything else the GM fairies wave the magic wand and pay you back.

There is no real profit in giving out loans but there is also no risk. And a penalty to pay back one of these loans is absurd. If the interest was based on a game year and not a real life year then there would be a chance to earn decent interest and a reason to have an early pay off penalty. But then that could help our economies without buying gold coins so that will never happen either.

so there's not much money to be made in giving loan? I mean the more loans you give the more interest being paid back so wouldn't that be some profits? or is it not worth my time ??? just wanting to strengthen economy '
Brandon Fleetwood
president of redneck land on lu

The profits are minimal. To get anything noticeable takes 10s of trillions but its better than the cash sitting there to me.

does giving loans help you move up on most helpful players ? and the 12% interest is for a real year that's confusing and I don't want to do the math but I see where your coming from on it just siting around

No only giving disaster aid helps with that and the interest is confusing. :/

So to clearify for anyone who wants to know:

- It is 12% interest per RL-Year

- Any Loan taken by an Entity that discontinues to exist is taken over by the world bank, meaning the world bank pays the interest and the payback at the end of the loan-time.
Due to this the interest rates are so low as there is absolutly Zero risk of the Money disapearing.