diff --git a/changelog.md b/changelog.md
index 0e836160..022a919f 100644
--- a/changelog.md
+++ b/changelog.md
@@ -9,6 +9,7 @@ Saves from 2.5 are not compatible with 3.0.
 * **[Campaign]** Ground units must now be recruited at a base with a factory and transferred to their destination. When buying units in the UI, the purchase will automatically be fulfilled at the closest factory, and a transfer will be created on the next turn.
 * **[UI]** Campaigns generated for an older or newer version of the game will now be marked as incompatible. They can still be played, but bugs may be present.
 * **[Modding]** Campaigns now choose locations for factories to spawn.
+* **[Modding]** Can now install custom factions to <DCS saved games>/Liberation/Factions instead of the Liberation install directory.
 
 ## Fixes
 
diff --git a/game/factions/faction_loader.py b/game/factions/faction_loader.py
index 35fb2830..d0722a00 100644
--- a/game/factions/faction_loader.py
+++ b/game/factions/faction_loader.py
@@ -2,8 +2,9 @@ from __future__ import annotations
 import json
 import logging
 from pathlib import Path
-from typing import Dict, Iterator, Optional, Type
+from typing import Dict, Iterator, List, Optional, Type
 
+from game import persistency
 from game.factions.faction import Faction
 
 FACTION_DIRECTORY = Path("./resources/factions/")
@@ -23,9 +24,16 @@ class FactionLoader:
         if self._factions is None:
             self._factions = self.load_factions()
 
+    @staticmethod
+    def find_faction_files_in(path: Path) -> List[Path]:
+        return [f for f in path.glob("*.json") if f.is_file()]
+
     @classmethod
     def load_factions(cls: Type[FactionLoader]) -> Dict[str, Faction]:
-        files = [f for f in FACTION_DIRECTORY.glob("*.json") if f.is_file()]
+        user_faction_path = Path(persistency.base_path()) / "Liberation/Factions"
+        files = cls.find_faction_files_in(
+            FACTION_DIRECTORY
+        ) + cls.find_faction_files_in(user_faction_path)
         factions = {}
 
         for f in files:
diff --git a/qt_ui/main.py b/qt_ui/main.py
index 5acfba73..826e455b 100644
--- a/qt_ui/main.py
+++ b/qt_ui/main.py
@@ -213,9 +213,6 @@ def lint_weapon_data() -> None:
 def main():
     logging_config.init_logging(VERSION)
 
-    # Load eagerly to catch errors early.
-    db.FACTIONS.initialize()
-
     game: Optional[Game] = None
 
     args = parse_args()