Need some Finance advice or comments about buying a airplane????

IMHO, you're always better off to rent something to learn in, rather than buying a plane to use as a trainer.   Training is a pretty harsh environment, and I'd put the wear-and-tear on a rental airplane.  If you buy, and something goes wrong with the plane, your lessons stop until you get the plane fixed.  The insurance company will certainly charge you more if you don't have a license yet...and the insurance will have to be written to include your CFI in the coverage (since you can't fly pilot in command until you solo).

Keep in mind, too, that as you take your lessons, you are going to learn a lot more about airplanes and what it takes to keep them legal (other than $$$$ :-).  After you get your license, you're going to be better prepared to shop.

There are companies that specialize in aircraft financing.  You might also consider alternatives that don't use the airplane itself as collateral.  If you own a home, a home equity line of credit loan will give you a lower interest and (potential) longer payoff period.   Collateral-free loans ("Signature loans") can also be an option, depending on your bank and your salary.

First, owning an airplane has far greater benefits compared to renting when it comes to 1) access to the aircraft, 2) a known maintenance history, and 3) motivation to go fly on the good days when everyone else wants to do the same (partially related to reason 1). However, it is not without responsibilities, and some of them can be very expensive.

First piece of advice: DO NOT buy an airplane just to get Private Pilot. Purchase an airplane that fits your particular mission in aviation at the current moment. If you see yourself traveling for business on 500 nm trips, get an airplane that can reasonably do that. If you want to take 1-2 passengers on a vacation regularly then get a 4-seat airplane. To be 1 seat and quite a bit of cargo room short of what you need means you will not use your airplane for that trip. Get something that meets your needs for the highest level of certificate you intend to go after now (meaning a real IFR airplane if you want your instrument rating). Upgrades can be VERY expensive.

Second piece of advice: If you disobey the first piece of advice DO NOT upgrade the airplane. We own a 1966 Piper Cherokee 140, and had I known then (when we purchased) what I know now I would have purchased an Archer. We spent more than the purchase price on upgrades and the first annual. The inital upgrades were all necessary: paint (the original 1966 paint was still in place and falling off rapidly, leaving bare aluminum to corrode), shoulder harnesses (necessary for safety, IMHO), new wingtips with HID lights (for added safety at night), thicker windshields (the old ones needed replacement anyway). Then it came to the first annual with some unforseen engine trouble and a few other issues that either appeared after or were not caught at the pre-purchase inspection. In a little over 1 year a $23,000 Cherokee 140 became a $50,000 Cherokee 140 (see #6 below) and we are not talking about glass cockpit/ new panel, 1 nav-comm without glideslope, portable intercomm, "shotgun" panel with the VSI above my left knee obscured by the yoke.

3rd: Get someone who knows about purchasing and owning airplanes to help you out.

4th: Insurance is cheap in something simple, my wife is a student pilot with 2 hrs logged time at purchase and our premiums with $42,000 hull coverage are around $1,000 per year. Our cars are more expensive to insure, at least in New Jersey.

5th: Depending upon where you live (particularly in the midwest for hail/ tornadoes or the southwest for severe heat that cooks avionics/ interiors) you may NEED a hangar to protect your investment. It is always nice to have one regardless, but factor that into the cost analysis and the economics might not make much sense.

6th: Owning an airplane CANNOT be financially justified unless you own your own business and plan to use it to get to and from your non-aviation work sites. However, if you have the resources and you really want an airplane go for it but realize that the care and feeding of an airplane can be very expensive if you put safety as a top priority.

In the end, the direct costs for our Cherokee 140 can, some years, go above $200/ hr. Would I still own knowing I can rent for half of that anywhere in the country? Absolutely! The piece of mind is well worth it. Now I just need a faster airplane for my new mission, and something that I can finish my instrument rating in.

Some good advice given in both posts.  Here's a bit more, I have a degree in accounting and spent many years as a cost analyst, when I decided to get my PPL I did a lot of investigating.  The decision should take into account not only what it will cost to get the license but what you will do with it once your training days are over.  In my case, I found a club that had 2 aircraft, C-150 and a Piper Archer.  My up-front cost to join was $3500 and I spent about $4K in rental and instruction costs to get the license.  This was back in the fall of 1992 through spring 1993.  I did all my training and check ride in the 150 and upgraded to the Archer after I got my ticket.  No insurance issues since the club carried the policy and the premium was pro-rated against the membership via monthly dues.  All fixed costs are spread out this way so you get insurance, hanger, govt. fees and annual inspection costs at a lower rate than an FBO rental. 

Since your just starting out, you want to get the license cheaply and come away with solid skills in the airport environment where you will spend most of your time.  I trained in class D so I had to deal with the radio and tower from my first lesson.  Most C-150's have a least one radio, they are pretty cheap to buy, fly, and maintain, as airplanes go.  In my opinion, the guys that start out in Cub or Champ types off grass strips will be better airman since the tail-draggers demand more attention to the wind and rudder than any tri-gear.  If your goal is to fly "low and slow" with the Sport Pilot than get the license in that type of aircraft.  If there is a club in your area check it out, if not and $ is a issue rent.  If you have the $ buy and fly!

Best of Luck!,

Joe

I have the best answer of all.

I am looking for a business partner to sell aircraft, and the buyer has all their monthly financed payments paid by my business model.

Thomas

thomasadair@live.com

Thanks for the info guys,, keep the discussion up, I think this info would be beneficial for me as well as others. A couple of more things I should have added, I do have a Hanger waiting to keep the plane it,, and I live in North Carolina.  My buddy is a Private Pilot CFI,,  really what I would love to do, is find a good Xair-H and just get my sport pilot license. several of my buddies have told me since I am young (30 year old) and single(hhahahaha) that I should go ahead and get my private license.

Yes, Yes, yes --- do it now!  If you wait until you develop added responsibilities, you won't get around to it until you are retired.  (personal experience)

If it flys, floats or ???, rent don't buy.  Thats coming from a guy who has owned 24 airplanes from an Aircoup to a 421 and currently has 4 antique and vintage aircraft.  I LOVE to own airplanes and I gave up long ago attempting to justify them.  If you can do it and still take care of your responsibilities then go for it.

I had to make a decision when I was young between gambling and airplanes.  I realized I couldn't spend enough money gambling so I decided to own airplanes.

Whatever you decide, just get flying. 

Buy one if it fits your budget.  Lots of good advice here.  Be sure and get a pre-buy inspection by a good mechanic.  Preferably not one based on the field that you plane your buying is at.  Go to a different airfield and hire one to do a pre-buy.

That is the best money you will spend on a plane.

I got started in flying in similar circumstances to thouse you're considering... bought into a Piper L4 and was taught to fly by a friend.   Don't regret it for a minute.

But on a couple of subsequent aircraft purchases I learned the hard way that Richard Brown is giving you excellent advice in the post above mine - - - get a thorough pre-buy inspection from a mechanic you can trust.

Buying an airplane to use while getting your license can be a good deal.  You can buy an older aircraft (this would rule out the Exair), fly it for 100 hours, and usually sell it for what you paid for it.  Of the latter two, I would choose the Aeronca, but that's largely because I prefer taildraggers, but it will also make you a better pilot than a C-150.

You probably can't directly finance either, but a home equity or personal loan may be an option depending on your credit.

If you're trying to compare owning to renting as far as economic viability, the math probably won't work out on the side of owning.

If you really want to own an airplane, there is no greater justification for it than wanting to own an airplane.

Life is short.....Buy the Champ.

I opted for the Private Certificate, then purchased a Champ by putting a boat up for collateral. I plan to regress (so to speak) all the way back to Hang Gliding. Plan your work and work your plan.