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finished plane financing

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drmax

Well Known Member
Yep, searched around here and found kit financing. Does anyone have any other companies, other that 1st priority, (7.9% :eek:) for establishing a loan? Nafco has a better rate than them, but was still trying to find someone else that may be doing loans. Thx for any add. info. DM
(loan for experimental a/c)
 
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Your bank.

GN, my bank has financed a bunch of airplanes for me over the years, with good rates. They know how to use Insured A/C Title service and gladly finance airplanes.

You might want to check your local sources too.

Best,
 
kinger said:
https://www.wingsfinancial.com/ASP/home.asp

Right on the front page they advertise: "Low Rates for Lofty Dreams" 2.99% APR
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...with a max of 60 months for fixed rate loans. Also nothing on their website saying they'll finance an experimental aircraft.

A few weeks ago I was looking at finance options too, and the AOPA/BoA program was advertising that their aircraft loan interest rate was 5.99% and that they were willing to loan on experimentals on a "case-by-case" basis. They want a $495 application/processing fee up front though. Something also didn't add up right with their online amortization calculator, since it calculated the monthly payments on the values I plugged in to be more than $300 per month higher than the monthly payments from any other normal loan amortization calculator. :eek:

Airfleet Capital's website also shows they're willing to loan on some experimentals (RVs, Glasairs and Lancairs only). Their current interest rate isn't mentioned on their website... you'll have to call them.

My local credit union quoted me 9.5% and only would go 7 years max term :eek: so that's definitely out.

Nafco quoted me 7.25% a few months ago, I don't know if that's still their current rate on Vans RV loans.

I lucked out to have a good friend of mine who is a successful local business owner and also owns multiple aircraft who heard I was looking to finance an RV and he offered to make me a personal loan from his business to match Nafco's quote. His money is sitting in the bank not making diddly-squat for interest right now, and I don't think I can find a better deal than that. I know that the interest money I'll be paying him will be circulated back into the local economy too, so I'm going to jump on that deal and buy the RV-6 I'm looking at.
 
i'll end up most likely with nafco. i think they want 10% down, which is about all i got. i'll use annual tax refunds to knock it out as quickly as possible
 
I did bank of america to buy my 7 last month. I generally dislike them, but this went smoothly..... I think you're spouses to be an aopa member, but I just left out blank and they never complained...
 
financing a home built airplane

Just a comment, because your finances are none of my business. The bank fees and interest you are going to have to pay to the bank could maybe be better spent on you aircraft project. Pacing your build time to the cash available for your project would probably be more gratifying than paying the bank month after month after month. I paced my project over 5 years. That worked for me. Airplanes can eat up your cash fast enough without having to pay bank financing charges on top.
 
Well said Dan!

Could not agree more. A guy I know often tries to explain me the difference between "good" debt and "bad" debt and each time I could not get it.

Dan B said:
Just a comment, because your finances are none of my business. The bank fees and interest you are going to have to pay to the bank could maybe be better spent on you aircraft project. Pacing your build time to the cash available for your project would probably be more gratifying than paying the bank month after month after month. I paced my project over 5 years. That worked for me. Airplanes can eat up your cash fast enough without having to pay bank financing charges on top.
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parking cash in a plane

I don?t believe any vehicle has much a chance to increase in value. Of course I have seen the car auction shows on TV, but we are talking about airplanes here. From spending quite a bit of time before I started my build looking at RV?s for sale, I am under the assumption that you can buy a built plane for just about the same as it cost to build one ? with no value assigned to the builders time. Im sure it is possible to make money building RV?s ? there are people that do it.

What I am getting at is ? parking some cash in a build is a pretty safe place to put it. You are not going to make money on it, but you should be able to get out most of what you put in. I wish I could say that about the market a couple years ago! The same as a bank with the lousy rate they are giving for deposits.

Looking at it through the eyes of a developer, the airplane is an investment that is neutral. If you can use the cash you would be putting into the airplane to make more money in another investment, you should consider financing the neutral investment and using the cash for the positive investment. It is all a numbers game that you have to be comfortable with.

Personally I would not leverage my house on an airplane loan, but I would use the airplane value itself to secure a loan to complete the construction. Losing the airplane because of financial issues is easy compared to losing a home ? at least for me. Maybe once I have finished the build, I will think different!!
 
misunderstanding

I think ya's missed my original "title" line of finished plane financing.
I'm not building...rather turn key. Looking to purchase a finished experimental Vans RV.
 
your right

I did miss that! In that case, as long as the airplane was used as the security for the loan, I would be in line with you.
 
?

rockwoodrv9 said:
I did miss that! In that case, as long as the airplane was used as the security for the loan, I would be in line with you.
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I want financing for an experimental aircraft. I don't have a plane to secure a loan. I think you need a nap.:p
 
maybe you need the nap!

drmax said:
I want financing for an experimental aircraft. I don't have a plane to secure a loan. I think you need a nap.:p
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Correct, you don't have the plane. You need the loan to get the plane. The plane you are purchasing will be the security for the loan. Just like a home loan or a car loan. You will not be able to borrow 100% of the cost of the plane and that will be the equity the bank or loan company will rely on to secure the loan. As long as the loan to value ratio is acceptable to the lender, it secures the loan.

I have been a resort and housing developer for over 30 years and understand how financing works. What I missed was you were buying a finished plane. You are correct though, I am about ready to hit the sack!

Good luck with the financing for your plane. The banks are getting quite a bit looser with money and making loans now that were not being made a year ago.
 
rockwoodrv9 said:
Correct, you don't have the plane. You need the loan to get the plane. The plane you are purchasing will be the security for the loan. Just like a home loan or a car loan. You will not be able to borrow 100% of the cost of the plane and that will be the equity the bank or loan company will rely on to secure the loan. As long as the loan to value ratio is acceptable to the lender, it secures the loan.

I have been a resort and housing developer for over 30 years and understand how financing works. What I missed was you were buying a finished plane. You are correct though, I am about ready to hit the sack!

Good luck with the financing for your plane. The banks are getting quite a bit looser with money and making loans now that were not being made a year ago.
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hehehe. i'm the one that needs the nap. Yep, there's only a whopping 2 places (that I've found) that do this as their business. One being nafco and that's where i'll most likely end up. i'll just need to pay the thing off quickly. take care and happy rabbit day! Greg
 
I used Red River state bank in Minnesota. The rate was under 7% and the process couldn't be smoother. I do think they have tightened lending on experimental aircraft but it is worth looking into. I got a 20 year loan but have managed to pay off almost 30% of my loan in the first year. A loan is not for everyone but it is working well for me, so far. Good luck.
 
tkatc said:
I used Red River state bank in Minnesota. The rate was under 7% and the process couldn't be smoother. I do think they have tightened lending on experimental aircraft but it is worth looking into. I got a 20 year loan but have managed to pay off almost 30% of my loan in the first year. A loan is not for everyone but it is working well for me, so far. Good luck.
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ok i will. r u from that area?
 
Nope, I'm from NJ. I've never even met anyone from that bank in person. I got the idea from a post on VAF and when I looked into it, it worked for me.
 
tkatc said:
I used Red River state bank in Minnesota. The rate was under 7% and the process couldn't be smoother.
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I emailed them a couple months ago and got back "sorry no experimental loans" so I guess they're only loaning on certified spamcans these days.
 
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Neal@F14 said:
I emailed them a couple months ago and got back "sorry no experimental loans" so I guess they're only loaning on certified spamcans these days.
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this is encouraging. i'll give them a call and see what they have to say. possibly this thread can turn into "discovery" of a loan agency out there that many of us are simply not aware of. I'll post back with results. Happy egg day!
 
Bank of America / Nacfo

Ok, above is what I have found and will share what I know.

BOA...only deals with Vans aircraft type experimentals. (i.e. not glassair) They dodo cert. aircraft.
39K to 49K 5.79% min 15 yrs payoff
50K to 99K 5.69% min 20 yrs payoff
requires 20% down. (15% down on certified aircraft)
$395 processing fee.

Nafco...
under 50K around 6.5% 15 yrs to payoff
over 50K around 6.75% nearing the top end 20 yrs to payoff
15% down
$400 processing fee.

It would appear BOA would be the winner here, based on my needs.
I hope this helps any other poor slob that isn't rich, LIKE ME!!!:D
 
My project was pay as you go up to a point, then I just used home equity. 3.99% is current interest rate but it is, of course, deductible on taxes (technically) and each month I only have to pay the interest if I can't come up with more money -- like this month, for example, when I'm writing the $3,700 check for sales taxes.:eek:
 
LettersFromFlyoverCountry said:
My project was pay as you go up to a point, then I just used home equity. 3.99% is current interest rate but it is, of course, deductible on taxes (technically) and each month I only have to pay the interest if I can't come up with more money -- like this month, for example, when I'm writing the $3,700 check for sales taxes.:eek:
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thx for your input, but this thread was never about building a plane. it's about purchasing a finished aircraft. take care
 
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