View Full Version : CTC wings Cadet scheme bond
30th Oct 2007, 14:33
Hi guys and girls
I was wondering if anybody could enlighten me about the CTC Wings cadet scheme bond. The bumf states that: “There are many ways of raising this bond and your chosen method will depend on your own personal financial position”
Does this then mean that really, you are no better off applying to say oxford who require a loan rather than a bond? And moreover does this mean that no security via a house means no way of getting in?
I would be interested to see what people think of this. Particularly those who have secured the bond for CTC and the way in which they have done it, as this is one of the avenues I am considering to get into aviation. However, like many others I just do not have the security house wise or finance to back it up.
Thanks in advance
R T Jones
30th Oct 2007, 15:13
The arrangement CTC have with HSBC is unique as far as I know. CTC require a bond of £60,000 with an additional £4,500 for a NZ PPL. I have taken a loan from HSBC for this amount and a further £5,000 for living expenses. The value of my training surpasses £65,000 as at a later date the type rating, base and line training are completed at no extra cost. This loan is unsecured and I have no collateral or savings to speak of.
My understanding of OAT's arrangement is HSBC will lend you up to £50,000 and anything above that you require must be from other sources. Savings, credit cards or parents! With living expenses you’re probably looking at a shade under £70,000. Hope this helps!
30th Oct 2007, 15:28
Dude its ALL on the CTC wings thread! Have a look through there is pretty much everything you need to know on there.
...and as far as I know, while you don't actually pay for the TR, (with easyJet) you only get paid £1000 a month during line training and that is paid by CTC, not the airline. So you essentially are flying for free for the first 6 months.
I may be wrong though, my memory aint what it used to be!
30th Oct 2007, 15:38
Having looked at both courses the bottom line is essentially the same: it will cost around £70k (CTC) - £75k (OAT) to complete the course.
CTC is highly selective and those that complete the course will continue on to do their type rating with one of the partner airlines (or wait until they get sponsored by one of the these airlines). This is as close as you can get to a guaranteed job in the cut throat world of aviation (provided you are successful). The employment statistics are such that HSBC will offer an unsecured loan since it is so confident that those selected will complete the course and start earning a salary within a matter of weeks. Since you are bonded however, this salary may be slightly reduced (since you will also be paying back the bond at the same time).
OAT has a higher turnover of students and whilst it will work hard to secure your first job, unless you manage to get a place on the NJ/XL/TCA/FlyBe schemes there is no guarantee of a job. The employment stats are currently encouraging but it may be take a little longer before you start earning. Consequently, since there is more of a risk that you will complete the course with massive debts and not walk straight into a job, HSBC stipulate that the £50k (max amount) must be secured. You will also notice that this leaves a funding gap of £20-£25k which must be acquired from other means. A large number of OAT students go to RyanAir who charge you to obtain your TR (could be as much as £20k extra) but, since you funded your own type rating you will not have a reduced salary to cover the costs.
Swings and roundabouts really, but both have a good reputation and, either way, you need that tick in the box before you get let loose in the right hand seat.
Hope this helps,
30th Oct 2007, 17:34
You're not wrong EZYramper easyjet will not pay you a penny in basic salary for your first six months with the airline as a cadet.
Does this then mean that really, you are no better off applying to say oxford who require a loan rather than a bond
I know CTC refer to the finance arrangement as a "bond", but it isn't - if you raise the cash through HSBC, it's a loan, pure and simple. You will pay it all back to the bank with interest on top - that is not a bond in any sense.
I know CTC claim the training is free, but that is to all intents and purposes, bulls*it. Anyone else who is ex-CTC would agree with me on that one. Of course you pay for the training you receive, there is no such thing as a free ticket in aviation anymore. What you do get from CTC is, on the whole, a good standard of training and a very good chance of going straight to a jet on completion of the course. The 60K (more like 89k once you have paid it back) is also used by CTC in a cost effective manner (in-house training, they own their own sims and are a TRTO provider etc) and dare I say it, I think it does represent good value for your investment. I'd still choose CTC over Oxford if I was starting again.
Good luck with your training.:ok:
30th Oct 2007, 21:08
Some of what is being said, but the main point is being missed. With CTC the £60,000 bond can come from your own capital or a (unsecured) loan. Repayments on the loan are defered until you gain employment.
The difference between CTC and any other training organisation, is that upon employment, the airline will pay you your monthly salary, PLUS an extra £1k a month to repay the loan. These repayments last for 7 years, meaning the airline will pay back £84k of your loan (12 months @<hidden> £1k x 7 years = 84 months).
So depending on the interest rate, a £60k loan at about 8.5% APR comes to around £84k over the entire 9 years (2 years draw [training], 7 years repay [employment]). Therefore your loan is paid back, as well as the interest. Now as interest rates vary, the £84k might come short by a few grand, but either way you get £84k of training free, hence making CTC a spnsored program - it's just the candidate, not CTC, that takes the risk.
Hope this helps!
30th Oct 2007, 21:38
Each airline has their own way of sorting out the loan repayment once they offer you a full time contract.
Yes the airlines will pay you a salary but if they are going to pay you the £1,000 a month to repay the loan, your salary will normally be £12,000 less a year than the eqivilant normal cadet entry salary.
Be under no illusions that you get a normal salary AND £1000 a month to repay the loan!
30th Oct 2007, 23:17
Thank-you all very much for your views. Im off to the graduate fair in Birmingham, Friday where CTC are doing a presentation so I will seek more information there. But I welcome anymore views on this topic, it has provided me with many answers.
Many thanks again
31st Oct 2007, 00:10
If you look at the difference between the Cadet salary scale and the direct entry salary scale, you'll find there is exactly £12,000 difference in pay at each step.
Although if we are being paid the extra £12,000 tax free, we are surely earning slightly more then a direct entry pilot?
Assuming an arbitrary tax rate of 20%:
£26,000 x .80 = £20,800 take home + tax free £12,000 = £32,800
£38,000 x .80 = £30,400 take home.
Then there's the trouble of a type rating!...
31st Oct 2007, 06:45
Not sure what it is like at easyJet but at the airline I went to (don't let my screen name fool you though!) it's not as straight forward as £1000 cash in an envelope to give back to HSBC. There are all kinds of interest and tax implications that go in the most round a bout way which really need some understanding.
Unfortunatly, you won't know these details until you join your airline.
31st Oct 2007, 10:49
I am not sure whereabouts in the country you are from but I might be able to help you avoid a trek to Birmingham and offer a more constructive alternative. CTC Wings will be at the Grad Recruitment Fair but they will be the only exhibitor involved with ab-initio pilot training.
The very next day (Sat 3rd November) there is a Flyer Professional Flight Training Show with the explicit intention of bringing you into contact with majority of the flying training organisations in Europe. There will also be presentations on the state of the industry, what is involved with the medical and how the assesment centres work.
On top of that the Guild of Air Pilots and Navigators will be there so you can get a (more) independent view of things other than basing it soley on what you learn from those with a vested interest in telling you what you want to hear to secure a cheque for £60k.
31st Oct 2007, 15:15
you get £84k of training free, hence making CTC a spnsored program
Mate you borrow 60K and give the whole lot to CTC. You then pay HSBC it all back, out of your salary. You most certainly do not get a full salary plus £1000 a month. It will come out of your salary and depending on the airline you end up with, the only difference will be whether you pay income tax on that £1000. At easyJet you do not, at BA and some others you do.
Be under no illusions, for the priviledge of training with CTC you will pay them 60k and you will pay at least 24k interest to HSBC, infact almost certainly more with interest rates what they are today. There is nothing sponsored about that, it is a mentored scheme, and a good one, but you pay handsomely for your training.
31st Oct 2007, 16:05
Completely agree with what Monarch330 and more Right rudder said. The fact of the matter is unless you are very very lucky there are very few ways to gain an ATPL with no cost incurred.
You will not get a full salary and £12000 on top. It normally works that you will be on a cadet salary with loan repayments on top ( The cadet salary is usually exactly £12000 less than the normal F/O salary). However the cadet salary is normally pretty good. Alternatively, and I believe this is the arrangement with airlines such as Thomas Cook, you get paid full whack from the outset but have to pay back your loan to HSBC.
If on the other hand you are one of the lucky few who has £60,000 tucked under your mattress then it is a slightly different story. There are numerous areas which should be thought about very carefully in any case, tax implications and such.
You could apply for oxford, provided that the bank is willing to lend you that kind of cash unsecured (doubtful). Furthermore If you succeed on the CTC wings scheme then you have an extremely good chance of sitting in the RHS of a jet two years from your start date. I am not sure whether Oxford place every single one of their cadets with an airline.
The point I am trying to make is that you need to go into these agreements with your eyes open. There is nothing underhand about them but they do need some understanding before you sign blindly on the bottom line. The training is not free as such, You are not paying for it directly however, more in a roundabout kinda way. Make no mistake my friend, everybody in this industry will get thier two penneth out of you. No such thing as a free luch anymore. That said it got me where I wanted to go and if its what you want to do, the best of luck to you.
1st Nov 2007, 13:07
Yeah, I agree with what you guys are saying about not getting the full salary and the monthly repayments as well, but the cadet salary instead.
The general salary figures given to me by CTC match up with the cadet salary, so I was just using the wrong terminology!