Getting loans

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Getting loans

When your cash goes red, you will automatically receive a loan. You may request the loan yourself and avoid your cash from going red but if it does happen, a loan request will be issued automatically and it will be large enough to bring your cash back into positive territory.

Loan paybacks are also automatic. They take place when the loans are due and may put your country in a negative cash position. As explained before, this will again result in a new loan in the following month. If your income is high and cash goes up every month, loan paybacks will not trigger new loans or will result in smaller loans and in the long run you will repay all your loans and end up with a positive cash balance.

The maximum period for a loan is 120 months. The highest amount, that can be offered is 9999 Billions.

Interest rates for loans are set to 1% per game year. Countries with large cash reserves can offer loans on the money market.

Interest rates for loaned money are low per game year; they are very high in real terms. At 1% interest per game year, which is 4 days, interest rates in Simcountry reach 90% to 180% in real terms.

Any member could exchange real money into game money, loan the game money out and receive 1% interest in 4 days. The game money can be exchanged into gold coins and into cash. The scheme is however unlikely to succeed on a large scale.

The main difficulty in this scheme is that there is no guarantee that the loans will be taken. The market may have enough cash and the available cash is not needed. If many players use the scheme, the market will be flooded with loan offerings with no takers at all.

When no money is available from players, loans are provided by the World Bank. These loans carry the same interest rate. The world-bank never takes any loans.

In periods of money surplus, the world-bank receives money back from loans that are due to be paid back. The money is taken out of the market.

A country may want to pay loans early. Cash can be earned from the sale of a corporation or from sale of shares in country owned corporations that went public or from an increased income from taxes. All loans can be paid early and such early payment carries a 2% penalty.

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