AIRCRAFT FINANCING FAQ
What types of financing are available on corporate aircraft?
- Purchase financing on 5-20 year amortization terms with fixed or variable rates.
- Operating Leases (5,7 or 10 year)
- Capital Leases
- Fractional Purchase
- Improvement Financing (Engine overhauls, avionics upgrades, cosmetic refurbishment)
Should I talk to my current lender about aircraft financing?
Many banks and financial institutions offer aircraft financing. In some cases, since they are familiar with you already, you may receive more favorable terms. However, lenders that specialize in aircraft usually make the process more efficient and can often lend higher amounts.
What types of rates are available?
- Rates are based on borrowing strength, loan to value ratios and term.
- Current price samples: 5 – 5.75% on variable rate loans, 6.25 – 7.25 on fixed rate loans.
How much down payment is required?
Down payments vary depending on the loan amount. Almost all programs require at least 10 %.
Are there any closing costs?
- Most of the lenders charge nominal document costs
- Very few charge points or large closing costs
Do the lenders require a personal guarantee?
- Not all programs require it.
- Typically required when shell corporations or LLC’s are being used to obtain financing.
Are there any specific aircraft requirements?
- Most lenders are leaning towards aircraft that are less than 25 years old and Stage III noise compliant
- Part 135 operations can be difficult to finance.
How quickly can I obtain financing?
- Typically takes 1-2 weeks for document review and approval.
- We recommend starting the approval process prior to contracting on an airplane.
- Some lenders can expedite process in less than seven days from start to finish.
