It’s nice to know that you have options with regards to flying a plane especially if you travel extensively. What is the best route for you to go financially? There are a great many aircraft financing options for you to choose from as well as criteria to consider with regards to obtaining the best aircraft financing rates. But first, let’s look at the various ways an aircraft finance loan can be helpful to you as a business person who flies, in general, a good deal of the time.
Even though you may fly quite a bit, you still want to feel grounded as far as meeting your deadlines and obligations. Many times commercial air travel can play havoc on the life of the business person who wants to keep to a schedule. Not only is there the factor of security to deal with, you are also challenged by traffic and crowds. In addition, flight plans can be delayed and canceled making it almost impractical to do business at times.
Therefore, considering an aircraft finance loan is a viable solution in contributing to your overall well-being when it comes to business and personal travel.
Commercial Aircraft Financing versus Fractional Ownership
Dependent on your current financial circumstances, owning a commercial jet can be a boon with regards to how seamlessly and smooth your day-to-day dealings go. Owning your own commercial plane can present a large initial outlay financially. In addition, you also have to anticipate continuing costs with regards to storage, maintenance, fuel and staffing requirements. Nevertheless, if you like the privacy afforded by choosing such an option, you will not mind to elect to finance commercially.
On the other hand, if you can’t allocate the time or resources in owning your own commercial craft, then fractional ownership can offer many advantages. The initial cost is less than owning your own jet because you own a share of the plane you choose to finance. Fractional ownership is a commercial aircraft financing option that affords the contributor the benefits of full ownership without the requirements imposed by trying to procure total financing.
Experimental Aircraft Financing
For those flyers who want to delve into the experimental side of flying, experimental aircraft financing is available for anyone who need funds for this type of purpose. You do need to be FAA certified and if your loan is a kit-built experimental plane, you generally will generally need to meet the requirement of a more sizable down payment. An appraisal is a needed in certain instances depending on the type of craft you’re interested in buying and the size of the loan.
Several types of loan packages are available offering good aircraft financing rates depending of course on the type of plane you’re financing and its overall cost. Fixed aircraft finance loans are generally for 15 or 20 years. Nonetheless, you can obtain such loans for a shorter duration if you wish.
Fixed and adjustable rate loans are normally offered for 3 or 5 year terms. Adjustments to the aircraft financing rates are therefore adjusted every 3 or 5 years. These types of loans are ideal for anyone who is purchasing a plane that is sound mechanically and the prevailing market rates are low at the time of financing.
Index based loans work in much the same way as fixed and adjustable rate loan packages in that they are best secured when the market rate indices are low. This allows the borrower an opportunity to pay off the balance earlier and build equity in his aircraft.
If your plane is in need of a major overhaul, then you stand to gain by opting for a fixed-rate loan. Typically, these types of loans can be obtained for terms of 15 or 20 years.
Conclusively, you have a great opportunity afforded to you when you own an airplane. Take the above information in consideration. Use it to keep you on a steady course toward financial solvency.