Flying On Borrowed Wings - 0 views

• 
  #1 Mitchel Mullins on 30 Jan 12

   

  Are you trying to buy an airplane, helicopter or glider? If you said yes, you are probably either leaking cash or you do not have anywhere near enough of it to purchase a plane. Don't worry if it is the latter: If your credit is great, you might always borrow the money.
  
  Like home loans and car loans, aircraft loans are financing schemes which permit people and businesses, including airlines, to buy and operate aircraft. Since aircraft tend to be extremely expensive, aircraft loans are very common in the air travel world.
  
  Aircraft loans vary from the relatively simple to the complex. At the simple end are loans for private and corporate aircraft; at the complex end are the loans industrial airlines use to buy their aircraft fleets. The simplest loans are those used for private and corporate aircraft; the more complex are used by commercial airlines to purchase and maintain their fleets. The easy schemes look like auto loans and home mortgages, while the more complicated arrangements resemble maritime and project financing.
  
  Here's a look at how it works when you use a loan to purchase a private or corporate aircraft. First, you allow the lender (presumably a bank or aircraft financial institution) basic information about yourself and the airplane you desire to purchase. The lender takes the next step, appraising the value of the aircraft and performing a search of the aircraft's title to guarantee it is owned free and clear. A security agreement is then prepared, providing the lender a security interest in the aircraft, together with a promissory note which holds you personally accountable for the remainder of the loan in case repossession of the aircraft does not cover the full balance. A surety, similar to a co-signor, might be required if you have questionable credit. If you've shaky credit, the lender might also require a surety, similar to a co-signor.
  
  This simple loan scheme is sufficient for those buying private and corporate aircraft, that are comparatively cheap in comparison to larger aircraft. The big jets flown by business airlines, by contrast, are very expensive. In 2011, Boeing priced its 747 passenger and carrier jets at $333 million, although airlines do not usually pay the full price.
  
  Airlines use three common financing ways to pay for their fleets: direct lending, operating leasing and finance leasing. There are other options for airlines, such as cash payments, tax leases and manufacturer assistance.
  
  Direct lending is much like the standard aircraft loans given to private owners, only on a bigger scale. This usually involves several banks chipping in to create a single loan for an airline. Here, as with private aircraft loans, lenders generally demand a security interest in the aircraft so they can repossess it if the loans go unpaid.
  
  Operating leasing, as opposed to direct lending, does not grant ownership to the aircraft's users. The airlines instead lease used aircraft from so called Commercial Aircraft Sales and Leasing companies, or aircraft lessors. These leases are usually short-term, no longer than 10 years, and they are most attractive to small airlines and start up ventures since costs are reduced and the airlines don't need to hold onto the aircraft beyond its usefulness.
  Finance leasing, finally, is basically a more complex form of operating leasing. Using debt and equity funding, third parties (partnerships or special purpose companies) purchase aircraft and lease them to airlines. In many cases the airline is given the option to buy the aircraft when the lease expires, or is given automatic ownership.
  
  Aircraft Loans

   

  <div class="cArrow"> </div><div class="cContentInner">Are you trying to buy an airplane, helicopter or glider? If you said yes, you are probably either leaking cash or you do not have anywhere near enough of it to purchase a plane. Don't worry if it is the latter: If your credit is great, you might always borrow the money.<br /><br />Like home loans and car loans, aircraft loans are financing schemes which permit people and businesses, including airlines, to buy and operate aircraft. Since aircraft tend to be extremely expensive, aircraft loans are very common in the air travel world.<br /><br />Aircraft loans vary from the relatively simple to the complex. At the simple end are loans for private and corporate aircraft; at the complex end are the loans industrial airlines use to buy their aircraft fleets. The simplest loans are those used for private and corporate aircraft; the more complex are used by commercial airlines to purchase and maintain their fleets. The easy schemes look like auto loans and home mortgages, while the more complicated arrangements resemble maritime and project financing.<br /><br />Here's a look at how it works when you use a loan to purchase a private or corporate aircraft. First, you allow the lender (presumably a bank or aircraft financial institution) basic information about yourself and the airplane you desire to purchase. The lender takes the next step, appraising the value of the aircraft and performing a search of the aircraft's title to guarantee it is owned free and clear. A security agreement is then prepared, providing the lender a security interest in the aircraft, together with a promissory note which holds you personally accountable for the remainder of the loan in case repossession of the aircraft does not cover the full balance. A surety, similar to a co-signor, might be required if you have questionable credit. If you've shaky credit, the lender might also require a surety, similar to a co-signor.<br /><br />This simple loan scheme is sufficient for those buying private and corporate aircraft, that are comparatively cheap in comparison to larger aircraft. The big jets flown by business airlines, by contrast, are very expensive. In 2011, Boeing priced its 747 passenger and carrier jets at $333 million, although airlines do not usually pay the full price.<br /><br />Airlines use three common financing ways to pay for their fleets: direct lending, operating leasing and finance leasing. There are other options for airlines, such as cash payments, tax leases and manufacturer assistance.<br /><br />Direct lending is much like the standard aircraft loans given to private owners, only on a bigger scale. This usually involves several banks chipping in to create a single loan for an airline. Here, as with private aircraft loans, lenders generally demand a security interest in the aircraft so they can repossess it if the loans go unpaid.<br /><br />Operating leasing, as opposed to direct lending, does not grant ownership to the aircraft's users. The airlines instead lease used aircraft from so called Commercial Aircraft Sales and Leasing companies, or aircraft lessors. These leases are usually short-term, no longer than 10 years, and they are most attractive to small airlines and start up ventures since costs are reduced and the airlines don't need to hold onto the aircraft beyond its usefulness.<br />Finance leasing, finally, is basically a more complex form of operating leasing. Using debt and equity funding, third parties (partnerships or special purpose companies) purchase aircraft and lease them to airlines. In many cases the airline is given the option to buy the aircraft when the lease expires, or is given automatic ownership.<br /><br /><a href="http://avionfinance.com" rel="nofollow">Aircraft Loans</a></div>

  ...

  Cancel

To Top