Hi Jeff,

In CT and MT you pay the deposit and then 240 payments meaning, as you say, you pay 220% of the ships price.

In GT because you pay the 20% deposit, as Alex points out you pay the mortgage in 80% of the value of the ship (which is more in line with what it should be).

I couldn’t find anything about the deposit bit in MgT2.

So while the mortgage is the same the overall financing of the ship is slightly different depending on the version that you are using.

-----Original Message-----
From: xxxxxx@simplelists.com <xxxxxx@simplelists.com> On Behalf Of Jeff Zeitlin
Sent: 20 February 2021 15:06
To: xxxxxx@simplelists.com
Subject: Re: [TML] Biospheres and Boodle

On Sat, 20 Feb 2021 17:35:35 +1000, Alex Goodwin <xxxxxx@multitel.com.au> wrote:

>On 20/2/21 6:21 am, xxxxxx@quibell.org.uk wrote:

>>Not sure that mixing economic systems works (i.e. working out the
>>mortgage in GT while paying life-support and cargo costs in MgT2).

>I was digging out basic comparison gubbins from GT, since I knew I
>would need a risk-free rate to build up the overall weighted average
>cost of capital (WACC).

>>Mortgages in MgT2 work a similar way as the rest of the Traveller i.e.
>>you pay 1/240th of the purchase price for 12 months in every year for
>>the next 40 years. Total cost of the ship is thus twice the build
>>price. This works out at about a 1.8% return on the banks' investment.
>>Or a 3.98% mortgage interest rate on repayment terms. MgT2 doesn't
>>mention the deposit, which might be why the interest rate is lower.

>Thanks for pointing out the disconnect.  In GT:FT, the monthly payments
>are the same (1/240th of purchase price) but the amount financed is
>lower (at most 80% of purchase price), which inflates the debt rate.
>Carrying the lower mortgage premium through drops the required return
>on equity to 6.96% pa and WACC to 4.58% pa.

Actually, I think Ewan got it slightly wrong, here - I distinctly recall from early Traveller that there was a 20% down-payment and then that you did pay 1/240 in each of 480 "monthly" payments, which makes the total purchace price of the ship 220% of list. Whether that carried over into late Traveller (including Mongoose), deponent sayeth naught.

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