All you aircraft owners (aircraft financing)
 

Well folks I have myself a predicament. I would very much like to purchase a C172 for pleasure flying and time building. I have one picked out in Florida I would like to buy but I'm not sure how to finance it. Is there anyone you guys know that would finance a first time buyer that makes 20,000 a year? I am having trouble finding a place that will allow me to. I am a member of AOPA and applied for their financing but they haven't contacted me. The website says they will have someone contact you in 24 hours but 6 days and 3 apps later I have heard not a peep. I am at a loss. Do I have to sit on my a$$ and not fly for two years to earn and save so I can pay cash or is their another option? I haven't flown in a year due to ridiculous renting costs and I can't stand the thought of not flying for even longer. Please help me.



By the way, mods if this belongs in the money section you can move it. I wasn't sure since this was more of a GA thing.

Thanks!

I am not an aircraft owner, but do have some current knowledge...

AOPA's affiliated lender is Bank of America. If you qualify for the loan, their rates are competitve: 6.75%. If you're a first-time aircraft owner, they'll want 30% down. AOPA is a good resource for you, but BOA are not "airplane" people.

The folks at Dorr Aviation Credit are "airplane" people. They are much easier to talk to and their rates are almost as good. They just offered me 6.85% with just 20% down.

Another good airplane finance co. is Zook Aviation.

YMMV. Good luck with your plans, and, yes, putting aside every penny you can for awhile is the best place to start. Hope this helps.

Amortization
 

How far out will they amortize the loan? 5, 10, or 20 years?

Skyhigh

If you're looking at a well-known make and model that the bank can accurrately appraise, they'll go 20 years. I've been asking about less-common types, Stearman for example, that they won't go past about 10 years on, at 8% to boot. Zook or NAFCO seem to be the best places for the less-common types.

I asked BOA about financing for a 1982 Great Lakes and they said, "A what? NFW!"

Hey Skyhigh! I'm glad you chimed in as I know you are a recent Cessna buyer. Any tips? How are you liking being an owner?

When you add it all up, you'll find that owning may be just as expensive... if not more so. My first plane was a 1600 hour TT Cessna 172M. Paid $19,000 for it (this was over 20 years ago). Sold it a few years later for $25,000, I think.

Engine overall cost about $10,000 ;-)

Maybe it's just me but it doesn't seem wise financially for someone making only 20K/year to be buying a plane. If something major breaks, you won't be able to afford to get it fixed. Try and find a local flying club.

I agree with you. Buying a plane because you're too broke to rent is a recipe for financial disaster. I've been involved with 4 different airplanes (two singles, two twins)... they all cost WAY more than I could have ever estimated.

I had a job that paid six figures when I was buying them.

I used BOA for an aircraft loan and will never use them again. We agreed on a rate and term, then when they sent the paperwork the day before closing, the terms were different than we agreed to. When I called them on it they said, in effect, "take it or leave it".... Big learning curve there. When you get the terms, get them in writing, don't accept the loan officer and their manager both agreeing to the same terms as set in stone.... I have talked with others that have used them and they have run into the same problem. They don't do it to everyone and I don't know if any other bank does this, but this was my unfortunate experience...

Another suggestion is to get an aviation attorney when you purchase an airplane. I am not a big advocate of attorneys, but a good one will see all the potential legal pitfalls that you may have never thought of....

Forgot to add, this was a few years ago, maybe they have gotten better since then....

I have a 2009 Diamond DA40 and have been extremely happy with the purchase. Diamond support is great over the phone and is always more than happy to assist my mechanic with any questions he has (he usually works on helicopters, he helps out on my plane to help me out).

My aircraft before was a Piper Seminole and that thing was a money pit. Getting rid of that thing was the best financial move of my life! I can't imagine ATP with their fleet of Seminoles.....must be an absolute nightmare for their maintenance crews.