If financing an aircraft is on your horizon, now is the time to secure your loan. The end of the year is fast approaching, and that means many individuals and businesses will be looking to finalize large purchases for tax offset purposes.

Getting preapproved in August or September is the smart move if you want to miss the hassle of buying during the holidays. As with any financial decision, timing is key.

Why Is There a Time Crunch?

According to Keller Laseter, Chief Commercial Officer at FLYING Finance, the answer is simple: holidays.

“The holidays are the biggest factor to our time crunch,” Laseter said. 

There are multiple bank holidays in the fourth quarter, and that significantly bottlenecks the process.

“When the banks are closed, we lose a lot of valuable time and your loan does not move forward,” Laseter said. 

While some salespeople and lenders may still be eager to close with you no matter the season, it’s an unavoidable fact that many banking and financial professionals will be planning vacations and focusing on family from October to early January—which means they won’t prioritize getting your loan closed. 

“The best way to avoid the busy season is to beat the crowd that’s late to the game,” said Laseter. “Being responsive, communicative, and having your ducks in a row will put you very high on the list.”

Why Start Shopping in August and September?

Waiting until Q4 can lead to delayed closings, aircraft being sold to cash buyers, and worse options and terms.

Typically, clients buying an aircraft for business reasons have complex financial documentation, meaning it takes time for lenders to underwrite them. The savvier and more prepared a client is, the more questions banks and lenders need to clarify. 

With many buyers going through this process at the same time, it can take longer for loans to be completed and can push some finalizations into the next year, which may not be ideal. 

Likewise, inventory is much more limited at the end of the year, with fewer options available for late buyers. The earlier you decide to take to the skies in a new plane, the more variety you’ll find and the more sellers and brokers will be willing to negotiate on terms in order to make those sales.

Can Both Corporate and Personal Aircraft Owners Benefit?

 Absolutely! Actually, securing your aircraft loan early is the surest way to reap the benefits of depreciation and minimize your tax burden. 

“There’s always a rush of clients who approach the finance team in mid-December looking to complete a loan on a large purchase before the end of the year,” Laseter said. “That’s our busiest time, so while we do our best to satisfy this request, it can be difficult.” 

Both corporate and personal buyers can get ahead by submitting the necessary documents as early as possible. Once approved, it’s simple to get reapproved if any time lapses.

Why Have Financing Preapproved in the Fall?

Two of the biggest factors that prolong the financing process are submitting all financial documents in a timely and accurate manner and finding the right deal on the aircraft that suits your needs. Completing the financing side of the equation means you can focus on shopping with confidence in your financial situation. 

The bigger and more complex the airplane, the more in depth the process has to be. Pre-buy inspections, appraisals, logbook review, and other factors mean you’ll want to line up your loan as early as possible so you can be satisfied with a thoroughly vetted aircraft. 

Without preapproval, the time, energy, and money spent on choosing and inspecting the right aircraft can be wasted.

“Just like with buying a house, someone who has an approval in hand when making an offer on an aircraft will be taken more seriously than someone without,” said Laseter. “If you have an approval and the aircraft of your dreams pops up for sale, you can move quickly on the sale and have less risk of the seller going with a cash buyer.”

How to Get Started 

Depending on how your finances are arranged, it’s a good idea to reach out to any investment brokers, accountants, or wealth management firms you work with to get a complete picture of your assets and liquidity. Likewise, make sure you know the details on any existing loans or liabilities so you can go into the pre-approval process with realistic goals. 

If you aren’t sure what documents you’ll need, the FLYING Finance team is here to help you with any questions. Getting started today will get you into your dream aircraft sooner. 

Instead of spending the holidays struggling to finalize details, you can be flying and enjoying the skies.

The post Beat the Holiday Time Crunch: Get Preapproved for an Aircraft Loan Now appeared first on FLYING Magazine.

FLYING asked readers for their best advice when it comes to buying and selling general aviation aircraft and if they had any regrets after a deal was struck. 

Here are some of the top responses:

Top Tips

“Aircraft ownership is great, but don’t buy unless you can hangar your purchase. The best aircraft out there have a tailwheel. If you must buy a tricycle gear airplane, don’t worry about buying the newest one, as they are the most expensive.”

—Glider pilot who also owns a Taylorcraft and a V-tail Bonanza in Holtville, California

“Be sure it’s got good bones—no corrosion or significant damage.”

—Commercial pilot with single-engine land rating

“If you’re buying with partners, recognize the partners you choose are even more important than the aircraft itself. A poor partnership experience can ruin even the best of aircraft.”

—Commercial pilot from York, Pennsylvania

“If selling, have all logs in order and digitized. Be accurate and complete describing aircraft including any inoperable equipment, damage history, or hail damage. Have good digital photos to share. Be friendly on the phone and in person. If buying, look for all of that mentioned, have a prepurchase inspection done by a disinterested A&P, get a title search, and copy of all the aircraft data available from [the FAA in] Oklahoma City, and be sure you can get insurance for it.”

—Pilot with more than 59 years experience with a commercial certificate, and instrument and ASMEL ratings from Springfield, Missouri

• READ MORE: Prepare to Sell Your Aircraft By Tapping Local Resources

“If buying, [get] a thorough prepurchase inspection by a reputable A&P/IA. This could also serve as a fresh annual inspection. Any airworthiness issues found should be points for price concession or sellers responsibility.”

—ATP/CFII/MEI FBO owner and operator for more than 20 years, aircraft broker, and Bonanza owner

“Determine make and model you’re interested in, join a type forum for the plane you like, then read and learn all you can before buying. Before you actually plunk money down, ask your forum members for a recommendation of a qualified A&P—one who is familiar with the plane in question—in the area of the seller to do a thorough pre-buy. Yes, it costs, but this is like money in the bank. Don’t skip this!”

—Reader with some flight experience from Hanover, New Hampshire

• READ MORE: The Power of Networking

“Establish [a] budget and do not spend more than 75 percent on the plane. Keep the rest in reserve. You will need it! Realize that if the plane is not near you, you may be spending $2,000 or more just to get it home.”

—Pilot who first soloed in 1963 and later flew in the U.S. Navy Reserve from Eugene, Oregon

“Do your homework first. Can you really afford the hanger fee, insurance, fuel, maintenance expenses, etc.? It might be more cost-effective to rent when needed instead of owning an aircraft.”

—Pilot with experience flying Piper P118A, Cessna 172, Cessna 182 Wren and Cessna 182 Robertson STOL aircraft from Austin, Texas

Buyer’s Remorse

“I should have done a title search beforehand, as I had the plane for many years. The bank did not file the paperwork properly with the FAA when the loan was paid off, and I had no idea about this until a title search was done.” 

—Private pilot for more than 40 years from Mount Airy, Maryland

“Not a regret necessarily, but the first annual inspection resulted in many items that ‘could’ have been deferred. We decided to fix all of them. Advice to prospective buyers: have 10 percent of the purchase price set aside for the first annual. If this seems like too much cash to cough up, you may want to reevaluate your financial ability to buy the airplane. If you don’t end up using 10 percent on maintenance the first year, consider it a bonus back to yourself.”

—Pilot who flies for personal and business purposes (commercial certificate with single-engine land, multiengine land, and instrument airplane ratings with private rotorcraft helicopter privileges) from Southern California

• READ MORE: Top 5 Mistakes First-Time Aircraft Buyers Make

“I regret not thoroughly reviewing logbooks.”

—Pilot with more than 40 years experience and a full-time aircraft broker from Carefree, Arizona

“As I begin to use the aircraft more for travel and less for just recreation, I am strongly considering an IFR upgrade, but the cost is considerable. Had I been where I am now, I might have held out for an already IFR airplane or one that could be made so without a large amount of upgrades. However, I really liked that particular airplane, and it met the mission at the time. (I wasn’t even IFR rated when I purchased, though I knew I would be getting my rating soon.)”

—Pilot with ASEL on a commercial certificate, a CFII, and tailwheel ratings from Houston

“Not a regret, but I would have looked closer at a known issue, which was not as simple of a fix as I was told. Not a deal-breaker but did take more time and money than anticipated.”

—Commercial pilot with rotor, and fixed wing CFII, MEI, G12T instructor pilot from Dothan, Alabama

“I sold for about a third of what I had invested.”

—Pilot flying since 1973 with ASEL, ASES, and helicopter ratings

The post FLYING’s Reader Advice on Buying, Selling Aircraft appeared first on FLYING Magazine.

Later this month, hundreds of thousands of pilots and aviation enthusiasts will attend EAA AirVenture in Oshkosh, Wisconsin—no doubt confronting the temptation of buying or selling their own GA aircraft.

• READ MORE: Prepare to Sell Your Aircraft By Tapping Local Resources

Some life lessons are much clearer in hindsight. We at FLYING want to know, what do you wish you had known before you bought or sold an aircraft? Tell us about it below and perhaps your words of wisdom will be used in an article.

The post Survey: What Advice Do You Have for Buying, Selling Aircraft? appeared first on FLYING Magazine.