Acquiring your own airplane may seem like a mammoth task, but The Aircraft Lenders make it significantly easier by providing guidance throughout the process. They specialize exclusively in aircraft financing. However, their services go beyond just placing your loan with the bank that will provide the best rates and terms. The Aircraft Lenders can help with aircraft valuations, letters of intent or purchase agreement templates, escrow-title recommendations, and even insurance sources. They pre-underwrite all loans, so they know which lenders are likely to approve you, and which will offer the most competitive rates and terms for your aircraft and mission. In addition to having specialized knowledge about the aviation industry, they also have a wide range of aircraft loan financing options available to potential airplane buyers. In this article, we will demystify the process, so you know what to expect.
Aircraft Loan Financing Options
The Aircraft Lenders provides a variety of aircraft loan financing options to suit different needs. Whether you’re purchasing your first small plane or are considering acquiring a jet, they have a great financing solution for you. Let’s go through the process. .
How To Finance an Aircraft?
- Let’s Talk! Start with a conversation with an aircraft financing specialist at The Aircraft Lenders. They want to make sure they understand your aircraft selection, mission, and financing goals so they can deliver the best options. They are usually able to give a soft quote on the phone, after an initial conversation.
- Submit your application and financials: Lenders require 2-3 years of Tax Returns, bank statements to back up your cash and investment holdings, W2s, if applicable, and most recent paystubs. If you own a business, they will also need Business Tax Returns, Debt Schedules, and interim financial statements, plus debt schedules for businesses that have debt.
- Respond to questions: There may be questions and some back and forth once the financials are received.
- Receive a credit decision: The Aircraft Lenders has a high approval rating, due to their pre-underwriting skills. They will relay any credit decisions along with closing requirements.
- Prepare for closing: The Aircraft Lenders will give you a detailed closing items list, outlining the bank’s closing requirements. These generally entail things like a signed Purchase Agreement, setting up an account with an approved aviation escrow-title company, providing certain logbook pages, a pre-buy report (not always required), etc.
- Closing: Loan docs may be signed digitally, or they may be ink-signed, depending on the lender. The Aircraft Lenders will assist with all steps until the loan is closed. All closings occur through a bank-approved escrow title company that handles Title Searches, FAA registrations, and disbursement of funds to the seller.
Aircraft financing companies like The Aircraft Lenders focus on getting you the best airplane financing rates and conditions to match your financial capabilities and aircraft preferences, and they work with you to get your deal approved and closed…from start to finish.
Aviation Finance – Aircraft Leasing and Aircraft Loans
The Aircraft Lenders offer a variety of options tailored to your needs:
- Aircraft Loans: Similar to mortgage products, these are the most common form of financing, providing flexibility in terms and conditions.
- Aircraft Leasing – Finance leases: These usually offer 100% financing, and can be lease-to-purchase deals, or sale-leasebacks. .
- Aircraft Leasing – Operating leases: Suitable for consumers and businesses, akin to a long-term rental.
Aircraft Loans and the Importance of Competitive Rates
The Aircraft Lenders knows that rates are a focal point for most borrowers, but they are only one piece of the package. Other things to consider are:
- Down Payment: The level of down payment required is an important consideration
- Term and Amortization: Is the lender offering a 5-year term with a longer amortization? A 20-year fixed term? You should consider how these things affect your monthly payment amount, as well as when you may have to make a balloon payment on the loan, if applicable.
- Pre-payment penalties: does the loan have any pre-payment penalties? How much are they and how long are they in place for?
- Fees: All banks have some kind of processing fee. These typically range from around $300 to $15k – $20k for larger jet transactions.
Aircraft Funding and Equipment
In addition to providing funding for the aircraft itself, there can also be loan options available for upgrades. This can include things like avionics upgrades, new paint, or new interior, to help make your plane truly your own.
FAQs
1. What are some of the factors that determine my aircraft loan financing options?
The Aircraft Lenders examines your credit history, cash flow as determined by your Tax Returns, your liquidity (cash and investment account balances), and the financial health of your business, if you are a business owner. They also look at the aircraft itself, considering age, value, and intended usage.
2. Can I finance used aircraft?
Yes, both new and used aircraft are eligible for financing, and there are lenders available for most ages of aircraft.
Conclusion
Every journey starts with a single step. When it comes to aircraft financing, that first step is reaching out to a trusted name like The Aircraft Lenders. With their experience and expertise, they simplify the process and help turn the dream of owning an airplane into a reality.
