2.5: Revamped Loans/Debt

[Dirty Chai]

Changes:
- Explicit hard monetary consequences to debt
- Taking out loans now requires imminent bankruptcy
- Got rid of "king" tier list of loans; max is now 10,000 pounds

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Interest rates are annual, going up every year by that amount.
Ex. a rate of 100% of a £200 loan is £400 the next year and then £600 the following year, then 800, 1000, etc.

You can only take out one loan per year, unless you are the King of England, in which case you can have up to four a year.

You may only take out a loan if your current expenses EXCEED your treasury or approach the depletion of it (100 pounds or less). You must take the lowest possible loan that will keep in the black for that year.

Loans are expected to be paid before 6 weeks pass. If this date comes and passes and the debts have not been filled, the party must default. If you default, if the king/parliament does not bar the usurers, then you will be forced (you can of course resort to violence) to mortgage off all your lordships and assets until you have either paid off your debts or you have nothing left to give. If the king/parliament restrains the usurers, the faction (king or parliament) will face opposition in all other matters from the commons for a few years.

The local banks and usurers in England will offer these basic loans & rates under normal circumstances:
£200 w/ 15% interest rate per annum
£500 w/ 15% interest rate per annum
£1000 w/ 15% interest rate per annum
£2000 w/ 15% interest rate per annum
£5000 w/ 15% interest rate per annum
£10,000 w/ 15% interest rate per annum

Debt levels and consequences:
Owes 100% or more of yearly land income: -10% to all income, levy rolls reduced by -2
Owes 200% or more..: -20% to all income, levy rolls reduced by -4
Owes 300% or more..: -30% to all income, levy rolls reduced by -6
Owes 400% or more..: -40% to all income, levy rolls reduced by -8
Owes 500% or more..: -50% to all income, levy rolls reduced -10

You may, under extraneous debt, mortgage off lordships (ie, provinces) in your possession to repay debts, valued to 200% of their yearly income. The King can purchase these mortgaged lordships for 10x their yearly income or else “no one” owns them.

The King can at any time, with parliamentary consent, declare debts void for any individual. However, if he does so for himself or for more than a couple large magnates, at moderator discretion, the banks will completely bar off future loans from the whole of England and diplomatic relations abroad will deteriorate greatly.

Furthermore, the commons (in parliament) will by large majority oppose any and all proposals made or seen to be led/proposed by individuals with outstanding debt (like 10x your yearly income or more), especially the king.

If the king (ie, the royal treasury) falls into outstanding debt, he will lose all legitimacy and will lose any partiality the militias and levies have for him and will suffer the same penalties as mentioned above.

Lastly, during wartime, only lords with access to London may take out loans.

How to take out a loan:
- Post your patriarch's total income for this year, unmodified from buildings/traits
- Post any previous debts along with the years they were taken out, their rates, and the accumulated total debt that amounts from all debts + interest

REMINDERS:
- You can only take out a loan if you treasury will be depleted this year or go less than 100 pounds.
- You can only get 1 loan a year, unless you’re the king (4 per year)

[General Brewster]

What about my loan if this is implemented. It's above 80K atm lol. What will happened to it and how will it work in the rules?

[Dirty Chai]

What's your yearly income?

[General Brewster]

Around 8k now with modifiers.
4ish without.

[Dirty Chai]

I'd throw it down to 30,000 or so in debt; it'd still be more than 5x your unmodified income, so you'd be 500% in debt and get the full penalties, but I think York planned on getting the king to waver the debts anyway so..

[General Brewster]

Aye that is the plan, however with these rules in place that would be a very stupid action for the king IC.