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How do loans/collateral work?
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Punisher Ofara
Amar Adventurers
#1 - 2017-04-13 15:47:08 UTC
Hi everyone,

I'm planning to request a loan in the near future to better fund my trading activities. Profits are decent, but my current lack of capital is slowing it down somewhat.
I'm wondering how does collateral work with loans? For example, if I was requesting a loan of 500m, and offered my Rokh, Mackinaw & something else as collateral, how do I actually create this deal, is it all based on mutual trust, or is there some in-game mechanism that I don't know about that can handle loans and collateral?
I don't expect to get a loan without collateral, but at the same time I don't want to hand out my ships to a scammer either.

Thank you in advance.
Tipa Riot
Federal Navy Academy
Gallente Federation
#2 - 2017-04-13 15:53:14 UTC
Either direct contract the collateral for the loan amount to the person giving the money, to be reversed with interest later or using a third party like Chribba, to hold the collateral during the loan period. The latter is suitable for more than one creditor.

There are no inbuilt mechanics for loans.

I'm my own NPC alt.
Jeronica
The Terrifying League Of Dog Fort
Deepwater Hooligans
#3 - 2017-04-14 13:23:16 UTC  |  Edited by: Jeronica
Basically:
1) Coordinate with a third party (Chribba/ENorn/etc) to hold onto your collateral. Talk to them about how much it's worth, as if you default they'd have to liquidate it and repay investors. IE, a t2 BPO won't be worth the collateral at the same value as the 'market price', as it could be a hard BPO to sell.
2) Post a loan request, using the value that the third party is willing to collateralize
3) ????
4) Profit!

That's collateralized loans in a nutshell.

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