Loans and financial fragility
Taking on debt, interest, payment schedules and avoiding the spiral.
The bank will lend you money. Use loans sparingly. A loan is a short-term lever to fund a transfer; it is not a way to run the club. Interest is real and the payment schedule does not pause for a bad run of form.
How loans work
You select a principal amount. Interest is set by size — 2% on loans up to 10M, 3% above that — charged as six times the rate, so the total repayment is the principal plus 12% (or 18% above 10M). Repayment runs weekly over 26 weeks, drawn automatically from the finance pulse, and does not pause for a bad run of form.
Interest rates
- Loans up to 10M carry 2% — a 12% cost on top of the principal in total.
- Loans above 10M carry 3% — an 18% cost on top in total.
- The rate does not depend on reputation or league position — only on the amount borrowed.
When loans make sense
Buying a 22-year-old prospect whose resale value will exceed principal plus interest within two years can justify it. Loans to pay wages or cover a budget gap are almost always a mistake — you're trading short-term comfort for long-term squeeze.
Financial fragility
Some saves use the "financial fragility" heat modifier — the board's patience for losses is lower and financial scrutiny is harsher. Treat fragility as a hard constraint: live within wage budget, sell to buy, and avoid debt unless the return is mathematically certain.