Bridge loans interest rate

~~Alonsua~~ · 01-10-2018, 05:17 AM

Hi there, when you are building multiple organization stats, and looking for investors without losing ownership over your company, what kind of interest rates do you apply? Six percent a year?

~~Alonsua~~ · 01-10-2018, 05:30 AM

Quote:

Originally Posted by Alonsua

Hi there, when you are building multiple organization stats, and looking for investors without losing ownership over your company, what kind of interest rates do you apply? Six percent a year?

Maybe a quick contest versus the lender or the organization lending the money, starting at 12% yearly and dropping/increasing 1% per +1/-1 up to a minimum of 6%?

whswhs · 01-10-2018, 06:41 AM

This is purely a worldbuilding question, and not a question of rules. Historically interest rates have varied tremendously.

One thing I would predict is that if the human lifespan is increased, interest rates will fall, perhaps dramatically.

mlangsdorf · 01-10-2018, 06:47 AM

First: how does this apply to GURPS?

Second: your loan rate is going to depend on the current APR and your credit worthiness. Bridge loans are going to be APR + at least a couple of percentage points + other costs.

In GURPS terms, some kind of quick contest of Finance between you and the lender is appropriate to determine how much over the APR you're paying for the loan.

GURPS Spaceships 2 has a discussion of financing with a focus on long term loans for spaceships but doesn't give any hard rules for negotiating the loan. However, the suggested rates for getting a fixed but depreciating asset on a 6-12 year repayment schedule are 8-16%. I'd expect the rates for bridge loans to be in that range or higher: companies needing bridge loans are often in risky positions and about to fail.

~~Alonsua~~ · 01-10-2018, 07:54 AM

Quote:

Originally Posted by mlangsdorf

First: how does this apply to GURPS?

Second: your loan rate is going to depend on the current APR and your credit worthiness. Bridge loans are going to be APR + at least a couple of percentage points + other costs.

In GURPS terms, some kind of quick contest of Finance between you and the lender is appropriate to determine how much over the APR you're paying for the loan.

GURPS Spaceships 2 has a discussion of financing with a focus on long term loans for spaceships but doesn't give any hard rules for negotiating the loan. However, the suggested rates for getting a fixed but depreciating asset on a 6-12 year repayment schedule are 8-16%. I'd expect the rates for bridge loans to be in that range or higher: companies needing bridge loans are often in risky positions and about to fail.

This. I set up an average of 12%/year with modifiers coming from a quick contest of finance with +1/-1% per point of success or failure :)

Steve Jackson · 01-10-2018, 11:09 PM

Sure. Quite relevant. "Free traders scraping to make the next payment on the starship" is a classic trope, and it helps to know what that payment is.

Could be worse for a cyborg character. "If I don't pay on time, they charge me an arm and a leg."

Or a ruler negotiating with the Church to finance the army that he hopes will win him back what he borrowed, with a goodly profit.

01-10-2018, 05:17 AM	#1
~~Alonsua~~ Banned Join Date: May 2017	Bridge loans interest rate Hi there, when you are building multiple organization stats, and looking for investors without losing ownership over your company, what kind of interest rates do you apply? Six percent a year?

01-10-2018, 06:41 AM	#3
whswhs Join Date: Jun 2005 Location: Lawrence, KS	Re: Bridge loans interest rate This is purely a worldbuilding question, and not a question of rules. Historically interest rates have varied tremendously. One thing I would predict is that if the human lifespan is increased, interest rates will fall, perhaps dramatically. __________________ Bill Stoddard I don't think we're in Oz any more.

01-10-2018, 06:47 AM	#4
mlangsdorf Join Date: Aug 2004 Location: Austin, TX	Re: Bridge loans interest rate First: how does this apply to GURPS? Second: your loan rate is going to depend on the current APR and your credit worthiness. Bridge loans are going to be APR + at least a couple of percentage points + other costs. In GURPS terms, some kind of quick contest of Finance between you and the lender is appropriate to determine how much over the APR you're paying for the loan. GURPS Spaceships 2 has a discussion of financing with a focus on long term loans for spaceships but doesn't give any hard rules for negotiating the loan. However, the suggested rates for getting a fixed but depreciating asset on a 6-12 year repayment schedule are 8-16%. I'd expect the rates for bridge loans to be in that range or higher: companies needing bridge loans are often in risky positions and about to fail. __________________ Read my GURPS blog: http://noschoolgrognard.blogspot.com

01-10-2018, 11:09 PM	#6
Steve Jackson President and EIC Join Date: Jul 2004	Re: Bridge loans interest rate Sure. Quite relevant. "Free traders scraping to make the next payment on the starship" is a classic trope, and it helps to know what that payment is. Could be worse for a cyborg character. "If I don't pay on time, they charge me an arm and a leg." Or a ruler negotiating with the Church to finance the army that he hopes will win him back what he borrowed, with a goodly profit.