salary and no. of years

[nodeal]

You cant do extreme back loading (not counting gilbert arenas provision see CBAFAQ) the max raises are 4.5%/7.5%.

(a) if the player is restricted free agent, then backloading makes it more difficult for the source team to keep the player?
(b) if the player is a big risk, then the team offering backloaded contracts can insure itself by selling the player in the final year as an expiring contract, and not have to pay the big part of the contract?

a) In some cases a team could make it more difficult for a team to match using a front loaded contract.
b) Big expiring contracts have value? that is a myth. It will be very difficult to unload a big expiring contract on someone without taking an equally bad contract back.

Below are two reasons contracts are back loaded vs front loaded.

1. The main reason most contracts are back loaded is because it saves you cap room in yr 1. Teams like to fit in as much as possible in their cap room or exceptions on yr 1.

2. The financial benefits for a player to front load a contract does not out weigh the benefits for an owner to back load a contract. So this pushes contracts to be back loaded. Imagine an owner who feels 4/40 back loaded is equal to 4/38 front loaded. The player probably wont feel the difference between front and back loaded is 2 million so they will choose the 40m back loaded contract over the 38m front loaded. If they were both 40m the player would choose* the front loaded contract.

The exceptions.
If a team has more room than they need they may decide to front load the contract. Morey/Ariza comes to mind.
*If a player is a max player and feels he'll earn more on his next contract using 105%(see CBAFAQ) vs the max salary, the player might prefer a back loaded contract.

In summary.
Players want front loaded contracts, but not as much as owners want back loaded contracts. GMs want back loaded contracts to fit in as much as they can in year 1. Sometimes theyll have more space than they need so theyll prefer front loaded contracts.

[r-creat]

great thanks to you all!

[DBoys]

the cba stipulates that annual raise is 4.5%/7.5% depending on the type of contract. is there any possibility that a team can do extreme backloading? for e.g., assume a player can get 4/ 30. can a team offer payout sequence (5, 5, 5, 15) instead of (6, 7, 8, 9)?

No, because the jump from 5 to 15 exceeds the 4.5 or 7.5 limit.

for the player, if the salary is guaranteed, he should be indifferent to whether it's backloaded or not.

That seems to be an accurate reflection of player attitudes in general.

From observation, players seem to place the most value on the total (guaranteed) dollars, with a relative indifference to the sequence in which it's paid as long as the number of years is apples-to-apples. So (ignoring raise limits) to a player, they'd equally welcome a fully guaranteed contract of $33M regardless of whether the team preferred to pay it as 10-11-12, 12-11-10, or 11-11-11.

[nodeal]

From observation, players seem to place the most value on the total (guaranteed) dollars, with a relative indifference to the sequence in which it's paid as long as the number of years is apples-to-apples. So (ignoring raise limits) to a player, they'd equally welcome a fully guaranteed contract of $33M regardless of whether the team preferred to pay it as 10-11-12, 12-11-10, or 11-11-11.

Thats just not true, no sane person would consider 10 11 12 and 12 11 10 equal. If a player has a choice between the two contracts they take 12 11 10 every time.

[DBoys]

From observation, players seem to place the most value on the total (guaranteed) dollars, with a relative indifference to the sequence in which it's paid as long as the number of years is apples-to-apples. So (ignoring raise limits) to a player, they'd equally welcome a fully guaranteed contract of $33M regardless of whether the team preferred to pay it as 10-11-12, 12-11-10, or 11-11-11.

Thats just not true, no sane person would consider 10 11 12 and 12 11 10 equal. If a player has a choice between the two contracts they take 12 11 10 every time.

I don't consider NBA-ers to be insane, so I have to disagree with your assertion. The key issue is contract negotiations is "how much do I get in total" and how it's paid out is more of an issue for the team's discretion rather than one the player is going to worry about at all.

[nodeal]

From observation, players seem to place the most value on the total (guaranteed) dollars, with a relative indifference to the sequence in which it's paid as long as the number of years is apples-to-apples. So (ignoring raise limits) to a player, they'd equally welcome a fully guaranteed contract of $33M regardless of whether the team preferred to pay it as 10-11-12, 12-11-10, or 11-11-11.

Thats just not true, no sane person would consider 10 11 12 and 12 11 10 equal. If a player has a choice between the two contracts they take 12 11 10 every time.

I don't consider NBA-ers to be insane, so I have to disagree with your assertion. The key issue is contract negotiations is "how much do I get in total" and how it's paid out is more of an issue for the team's discretion rather than one the player is going to worry about at all.

12 11 10 they get 2 million 2 years before 10 11 12. You think players would just say 11 average i dont care if i get 2 million 2 years early? Why do players try to get advanced payments annually if they dont care about getting money upfront?

[DBoys]

12 11 10 they get 2 million 2 years before 10 11 12. You think players would just say 11 average i dont care if i get 2 million 2 years early? Why do players try to get advanced payments annually if they dont care about getting money upfront?

You ask me why, and I can't read minds. All I can speak to is what "is" not what "should be." Frontloaded contracts are a rarity, which speaks to the fact that as long as they get $X in total, the payout schedule becomes relatively unimportant.

[nodeal]

12 11 10 they get 2 million 2 years before 10 11 12. You think players would just say 11 average i dont care if i get 2 million 2 years early? Why do players try to get advanced payments annually if they dont care about getting money upfront?

You ask me why, and I can't read minds. All I can speak to is what "is" not what "should be." Frontloaded contracts are a rarity, which speaks to the fact that as long as they get $X in total, the payout schedule becomes relatively unimportant.

Front loaded contracts are very important to players. Back loaded contracts are very important to owners. Those 2 cancel each other out. That leaves GMs wanting back loaded contracts so they can fit as much salary in the current year as possible.

Its like saying players getting advanced payments are a rarity, so players must find advanced payments unimportant.

[Dunkenstein]

Front loaded contracts are very important to players. Back loaded contracts are very important to owners. Those 2 cancel each other out. That leaves GMs wanting back loaded contracts so they can fit as much salary in the current year as possible.

Its like saying players getting advanced payments are a rarity, so players must find advanced payments unimportant.

Actually there are times when the team will request a front-loaded contract. Say a team wants extra cap room the following season to use to get free agents, they may offer to pay Player X more in the first season of a contract. Or suppose Player Y is coming off his rookie contract in the following season and will get a big raise. The team may want to help balance out their payroll by giving Player X a descending contract starting this season.

You are placing undue importance on players desire to get descending contracts and teams wanting ascending contracts. Usually a player's agent will work with the team to work out the terms of the contract so that the team can most effectively use its payroll to get the best team possible. As DBoys stated earlier, for the most part the players and their agents are primarily concerned with the total dollar amount of the contract.

[nodeal]

Actually there are times when the team will request a front-loaded contract. Say a team wants extra cap room the following season to use to get free agents, they may offer to pay Player X more in the first season of a contract. Or suppose Player Y is coming off his rookie contract in the following season and will get a big raise. The team may want to help balance out their payroll by giving Player X a descending contract starting this season.

You are placing undue importance on players desire to get descending contracts and teams wanting ascending contracts. Usually a player's agent will work with the team to work out the terms of the contract so that the team can most effectively use its payroll to get the best team possible. As DBoys stated earlier, for the most part the players and their agents are primarily concerned with the total dollar amount of the contract.

I coverred all of that here
viewtopic.php?p=40862359#p40862359

The point is $ is $
Front loaded means more $ for the player. Its no different than just adding $ to the contract. So you cant say it is unimportant. It is very important as are the other factors that will be included in negotiations. Player/Team options are very important.

12 11 10 = $200,000 more for the player at a minimum than 10 11 12

Every aspect is important when it comes to negotiations.

Melo negotiated a cash advance so it is important to him. That is also cash paid 1 yr in advance every yr not advance payment over multiple years. Front loaded vs back loaded is multiple years.

14 15 16 17 18 is significantly worse for the player than 18 17 16 15 14. If the team wants a back loaded contract theyd have to offer more guaranteed money. The player wont look and think they are equal. Likewise if the team prefers a front loaded contract they could eventually negotiate a contract that is less per year than if they wanted a back loaded contract.

[DBoys]

Usually a player's agent will work with the team to work out the terms of the contract so that the team can most effectively use its payroll to get the best team possible. As DBoys stated earlier, for the most part the players and their agents are primarily concerned with the total dollar amount of the contract.

This.

[Dunkenstein]

14 15 16 17 18 is significantly worse for the player than 18 17 16 15 14.

Actually it isn't. If the player and his agent anticipate later wanting an extension based on his existing contract, an ascending contract is much better for the player, because the first year of the extension will be significantly larger since it is limited to 107.5% of the final year of his existing contract. Using your example, the player getting $14M in his final year will be limited to an extension starting at $15.05M, while the player getting $18M in his final year will be able to get an extension starting at $19.35M.

[nodeal]

14 15 16 17 18 is significantly worse for the player than 18 17 16 15 14.

Actually it isn't. If the player and his agent anticipate later wanting an extension based on his existing contract, an ascending contract is much better for the player, because the first year of the extension will be significantly larger since it is limited to 107.5% of the final year of his existing contract. Using your example, the player getting $14M in his final year will be limited to an extension starting at $15.05M, while the player getting $18M in his final year will be able to get an extension starting at $19.35M.

Theyll take the money over the small possibility at age 35+ theyll be worth more than a starting salary of 15m(basically the same salary they are signing in their prime) and that they will even reach an agreement on an extension. If the player is also worth a starting salary of 19m he's probably going to prefer another 5 year contract vs a 3 yr contract which an extension is limited to.

But yes players will take the possibility of an increased chance of signing an extension into consideration. They take everything into consideration. Thats basically my point, its not just length and guaranteed money. Every factor is important. Front loaded even with the above is far superior to back loaded in most circumstances.

[DBoys]

But yes players will take the possibility of an increased chance of signing an extension into consideration. They take everything into consideration. Thats basically my point, its not just length and guaranteed money. Every factor is important. Front loaded even with the above is far superior to back loaded in most circumstances.

You can blather on and on out of ignorance of what is actually happening in NBA negotiations, and it appears you will.

But all the financial theory you cite isn't what's really happening in the real world, so there's that for everyone else.

[nodeal]

But yes players will take the possibility of an increased chance of signing an extension into consideration. They take everything into consideration. Thats basically my point, its not just length and guaranteed money. Every factor is important. Front loaded even with the above is far superior to back loaded in most circumstances.

You can blather on and on out of ignorance of what is actually happening in NBA negotiations, and it appears you will.

But all the financial theory you cite isn't what's really happening in the real world, so there's that for everyone else.

Melo, lebron JR smith negotiated advanced payments. That right there should tell you getting money upfront is important to players.

http://en.wikipedia.org/wiki/Time_value_of_money

[DBoys]

But yes players will take the possibility of an increased chance of signing an extension into consideration. They take everything into consideration. Thats basically my point, its not just length and guaranteed money. Every factor is important. Front loaded even with the above is far superior to back loaded in most circumstances.

You can blather on and on out of ignorance of what is actually happening in NBA negotiations, and it appears you will.

But all the financial theory you cite isn't what's really happening in the real world, so there's that for everyone else.

Melo, lebron JR smith negotiated advanced payments. That right there should tell you getting money upfront is important to players

~shrug~ The exception is not the norm.

The question has been as to what normally is most important in NBA contract negotiations..

"That right there" tells us nothing except what happened with 3 specific players in 1 specific deal signed by each. Nor does it tell us what was MOST important with those 3 players, but it only told us one plus of one specific deal they signed. There are more than 450 NBA players with contracts, not 3, and there are all sorts of terms that are or are not in each of those 3 deals as well as all the others.

As Dunk told you, "for the most part the players and their agents are primarily concerned with the total dollar amount of the contract." After they get the most important stuff decided, then some might come back and try to get a cherry on top, others might look for whipped cream or sprinkles, and some might not ask for anything at all.

[Smitty731]

I would think if frontloaded contracts were so important to players, we would say far more of them than we do. As others have laid out, it generally seems like players want the overall money and don't care about the pay structure too much. They would rather leave a little more now and allow the team to add players around them.

In theory, for mid career to end of career players, I don't mind the frontloaded deals from a team perspective. Again, in theory, as the player's abilities decline, the pay also declines. I just wish in the CBA construct it could be by more than the set percent amounts. That would allow teams to structure contracts far more appropriately. Then again, large chunks of the CBA are to protect teams from themselves. So maybe my entire theory is wrong!

[Dunkenstein]

But yes players will take the possibility of an increased chance of signing an extension into consideration. They take everything into consideration. Thats basically my point, its not just length and guaranteed money. Every factor is important. Front loaded even with the above is far superior to back loaded in most circumstances.

You can blather on and on out of ignorance of what is actually happening in NBA negotiations, and it appears you will.

But all the financial theory you cite isn't what's really happening in the real world, so there's that for everyone else.

Melo, lebron JR smith negotiated advanced payments. That right there should tell you getting money upfront is important to players.

http://en.wikipedia.org/wiki/Time_value_of_money

Earlier you referred descending contracts as frontloaded contracts. Now you start using the terms advanced payments and upfront money to discuss something totally different.

In your mind, what is a frontloaded contract? Is it a descending contract? Or is it a contract where the player gets up to 50% of his yearly salary paid by October 1?

[nodeal]

You can blather on and on out of ignorance of what is actually happening in NBA negotiations, and it appears you will.

But all the financial theory you cite isn't what's really happening in the real world, so there's that for everyone else.

Melo, lebron JR smith negotiated advanced payments. That right there should tell you getting money upfront is important to players.

http://en.wikipedia.org/wiki/Time_value_of_money

Earlier you referred descending contracts as frontloaded contracts. Now you start using the terms advanced payments and upfront money to discuss something totally different.

In your mind, what is a frontloaded contract? Is it a descending contract? Or is it a contract where the player gets up to 50% of his yearly salary paid by October 1?

Front loaded contracts are descending contracts. Im just trying to explain why a front loaded contract is more valuable to the player than a back loaded contract with few exceptions.

"Players care about guaranteed money"
"Front loaded contracts add guaranteed money"

I see the goal line has been shifted from not important to less important. Yes $200,000 in additional interest is worth less than adding $250,000 to the contract I never claimed otherwise.

So (ignoring raise limits) to a player, they'd equally welcome a fully guaranteed contract of $33M regardless of whether the team preferred to pay it as 10-11-12, 12-11-10, or 11-11-11.

This is where the debate started. To say a player doesnt care about 12-11-10 vs 11-11-11 vs 10-11-12 is the same as saying the player doesnt care about a few hundred thousand dollars.