Bankruptcy

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Bankruptcy is declared after two weeks of debts over 500 000 US$, the maximum credit you can get in the bank.
A manager who has gone bankrupt in debt loses his/her team and that team is converted to a computer managed bot.

Debt

You go in debt if balance cash funds are below zero during your weekly update, when the teams' finances are recalculated.

Even if you have no money left in the bank, you have a line of credit for 500 000 US$ and there's nothing to keep you from spending more money.

Only be careful: you are in debt and you're going to have to pay some interest on borrowed money. The debt burden, if not repaid quickly, easily adds up, so better go back over the debt.

Interest are an extra 3.33% of your total amount under zero payed to bank as interest every week

Some managers will have a hard time paying this interest and paying off the debt at the same time. Especially new clubs should be warned not to go in debt with their club for too long.
In any case there is also an additional protection:

When you run up debts amounting to - 200 000 $, your board will prohibit you from purchasing other players, replacing your coach and doing anything that would take the debt beyond that threshold.

This can seriously affect your progress. If you have board reserves it's time to unleash them. A financial director, who you can hire for your staff, can increase both the working capital and the rate of return from the cash reserves.

Bankruptcy Warning

You will be given a bankruptcy warning when your balance is at - 500 000 US$ or below after an economical update. You will get a "Danger of Bankruptcy notice" in the front page when you login, so you can't go bankruptcy without noticing it.

Danger of bankruptcy!!! Your club is on the verge of being declared bankrupt because you have exceeded the amount you are allowed to go into debt (500 000 €). You have 2 weeks left to remedy this and restore your balance to the limit. Once again: Restore your balance as soon as possible! If you fail in this, your team will be locked and eventually a new owner will take over your position in Hattrick. Also, keep in mind that your cash balance is only updated weekly, so this warning will remain in place even if you are above the limit until the weekly update has occurred. So, once more: Start selling players and cutting your costs immediately or you will lose your club!

This means troubles for your team: if must return your balance over this amount debt limit within two weeks from bankruptcy warning.

Application of bankruptcy order

Bankruptcy is effective if you don't have players for sale with bids enough to reach the "safe zone" and the team has no cash on the board reserves. You will be forced to leave the game!

If you do manage to sort out the financial situation, you can continue to play as normal. As long as you have a plan to get out of debt, you'll probably be fine. Check your revenue and expenses and figure out whether your revenues in the end will be higher than your expenses. However, make sure you don't end up with a balance under the permitted limit for two consecutive weeks.

History

The application of bankruptcy order was changed after season 28.

The old rule was that you had only 5 logins left after an economy update over permitted limit, but there was no limitations concerning the weeks.

You could wait nearly 7 weeks till your first login, again nearly 7 till your second, and so on. You could use your last login after more than a month and you'd still be owning your team although with an insane debt.

Hattrick announces

Bankruptcy change

25/08/2006

The Hattrick Football Association (HFA) has had enough of supporting players in bankrupted teams. - As of September 11, 2006 we will no longer pay salaries to players in teams that have gone bankrupt, HFA's spokesperson says. - This will of course mean that those players will leave their bankrupted teams and quit playing football since their teams cannot pay their salaries; but we don't see any reason for continuing to take the economical damage for teams going bankrupt. National team players will however not quit if their teams go bankrupt. HFA will make sure they get transfer listed.

The HTs had to change it because The limitation concerning the logins was perverted in such a way that FC Barentin used that "flaw" to win the Hattrick Masters despite a debt of 50 000 000 € or even more. The old system was abolished and the current limitation of two weeks introduced instead.

See Also

• Farm teams indebt themselves and therefore disappear from the game.