Repayments, how do you do it?

[McWho]

I managed to get accepted into a good school and the paperwork for the loan has finally come through.

The loan amount is approximately £80k and I've been saving up for the past 12 months to cover the remainder for the training which is just over £90k total, this loan doesn't take into account my type rating costs, which I'm told will reach an additional £35k for a jet.

The repayments for the loan, are approx £800 for years 2-4, and £1200 for years 4-10.

I figure, if my rent is £80-90p/w my outgoings (worst case 5 week month) before paying utility bills, food or transport are approximately £1,650 pcm.

I believe just to make ends meet, keep my car on the road, pay various bills and food expenses, I would need to earn a minimum of £32k from the outset with a take home after tax salary of approximately £1,900

Researching I see that Ryan Air pay as low as £21k for FO. I've read horror stories of new starters (and I'm not clear on rank here) earning as little as £12k in the first year with Ryan Air.

By contrast, in the thread regarding the recent recruitment by Thompson, it was claimed a FO would earn £60k in the first year. But it seems this might be for unfrozen direct entry applicants?

It seems to me that unless you land a job with Thompson or BA you will not be in a comfortable position financially, I had also read that you should expect to be in a holding pool for up to 2 years after graduating prior to being taken on by Easyjet.

Can anyone clarify the situation in terms of earnings, and how you were able to make the repayments? It seems that if I couldn't find full time employment with an airline immediately, I would have to return to my current industry, and holding down a full time job might make it somewhat impossible to pursue professional part-time flying.

If anyone can comment on earnings and how quickly they found work, it would be much appreciated.

[zondaracer]

A friend of mine got a loan for €60,000 for flight training. He was unable to find a job for two years, so he worked at a fast food restaurant. During those two years, he moved up to a manager position within the restaurant. At the end of those two years, he finally got the phone call to work at a flight instructor. Now that he is working as an instructor during the week, it still doesn't cover the cost of his loan and living expenses, so he still works at the fast food place on the weekends, but he makes more on the weekend at his side job than at his flight instructor job during the week.

In my opinion, a loan of such a large size is outrageous if you don't have a sizable income already or a large savings, or if you don't have someone to help with the payments. I could see taking a small loan to help finish paying costs once you've saved up quite a bit, but the reality is that lots of guys finishing training today are not recouping the costs or making ends meet right out of training.

[clunk1001]

How do you afford the repayments?

Well you might be one of the lucky lucky few selected for a prestigious flying job like this : http://www.pprune.org/interviews-jobs-sponsorship/501571-fantastic-job-offer-pilots-finally-death-aviation-careers.html

Although, technically you'd need to borrow a further 120k to buy hours on type for a few years, before then being eligible to work, for free.

Welcome to the Aviation industry in 2012!

I trust that this allows you to have an educated guess at the answer to your initial question.

I've got a better question:
What industry are you currently in? Is it a secure one?

[Wirbelsturm]

Welcome to the world of exploitation.

Student are marching in the UK over 'outrageous' University fees of £9,000 per annum. Given that most degree courses are 3-5 years that will give you a student loan repayment (not including living costs) of between £27,000-£45,000 on completion. They see this, quite rightly given the current Governments pre election promises, as unacceptable.

You are willing to put up £80,000+, not inclusive living costs, for a two year course to enter a flooded market that is subject to extreme volitility due recession, technology, conflict and oil price. Does that sound like a good idea, really?

The problem comes when the companies started to realise that there was no point in paying for cadetschemes to train people based upon ability when they would 'prostitute' themselves finacially to achieve 'the dream'. When they then further fleeced them to pay for their own type ratings, JOC and MCC the accountants realised they could sell the RHS for greater returns than any other seat in the cabin.

The training schools must love this approach. They ply their trade and 'Future Pilot Symposiums' and continue to promise the world wide pilot shortage that was being plugged back in the early 80's when I started.

Simply put, the pilot shortage will NEVER happen whilst people are so prepared to invest ludicrous amounts of money into schemes which will put them heavily into debt with no guarantee of a position to be able to service the debt. A fact you have at least discovered prior to commencing the slippery slope. Whilst the bean counters can rely upon a steady stream of young people being fed a line from unscrupulous Traing colleges there will never be a return to Airline sponsered cadet schemes.

BA, at least, has seen the benefit in recruiting for ability instead of cash (IMHO). Whilst the FPP program isn't perfect you do get the initial funding returned to you and you are, more or less, guaranteed a job dependant upon the current economic climate. To be honest probably about the best you are going to get looking at the state of major players (LH, AA, AF/KLM and IB).

Well done for realising that all is not well and rosy in the airline world before starting. It's better to go into something like this with your eyes wide open. Believe me that the grass always looks greener from the other side of the fence. After 10 years plugging mediocre SH routes from dawn till dusk, the green grass fades quite rapidly when you realise for 8 months of the year you are paying the tax man and for the remaining 4 you are paying your loan provider.

Enjoy, Per Ardua ad Astra, through adversity to the stars!!!

:ugh:

[clunk1001]

Well done for realising that all is not well and rosy in the airline world before starting. It's better to go into something like this with your eyes wide open

not so fast Wirbelstrum....:)

Just to confirm McWho - it was you that failed the CTC selection test a few years ago, to such an extent that they actually barred you from reapplying? That was you, wasn't it?

Has the industry improved since you researched this first time around? Or is it simply that now the paperwork for the loan has finally come through for 80k?

Good luck, because you are seriously going to need it!

[Wirbelsturm]

Just to confirm McWho - it was you that failed the CTC selection test a few years ago, to such an extent that they actually barred you from reapplying? That was you, wasn't it?


:}

Perhaps I should look at previous posts before assuming good intentions! :E

Cheers Clunk.

[Torque Tonight]

McWho, shouldn't you have been asking these questions and doing these calculations before you embarked on this career path.

The sad fact is that the financial numbers simply do not work out for many students. Many would only be able to service their loans in the best case scenario of getting a good flying job immediately. Most will not get a flying job immediately, many never will at all. Many will go bankrupt, many will have to return to their previous jobs to pay for the qualifications that they will therefore be unable to use. Many of those who do get pilot 'jobs' will be living in effective poverty for many years. the Flying school brochure cover lifestyle is not a reality for the vast majority who apply to the schools.

This is a matter of due diligence which you should probably have done earlier, but you are certainly not alone. Virtually nobody seeks out the bad news, even though it would save them much pain later.

[McWho]

Hi, yes I applied to CTC after I graduated and didn't do well on the interview, we were told at the time that if we didn't make it through but scored highly enough we may get a second opportunity, apparently I didn't score highly enough.

This was my second attempt. Though I'm not sure what relevance this has or the point about good intentions?

I'd be interested to hear from those who have gone ahead and are working in the industry?

[Torque Tonight]

I am working in the industry. Many of my coursemates weren't so lucky, hence my comments above.

[Wirbelsturm]

I've been working in the industry for longer than I care to remember.

Read my post above!

If people keep applyiing to waste their money there will never be any change to ab-initio's being fleeced by unscrupulous training providers and airlines.

[taxistaxing]

I managed to get accepted into a good school and the paperwork for the loan has finally come through.

Are you tagged by an airline, or just through the door of the school? If you're not tagged I would be thinking very carefully about the limited prospects following training, and exactly how you are going to service the loan repayments. Is the loan secured on your (or your parent's) property? If so you need a plan in place as to how you will afford the repayments.

I'm not working in the industry but training on a modular basis, funded entirely from my earnings earnings in another (thankfully well paid) career. I fully accept this is going to take longer than an integrated course, and has very uncertain prospects, but at least I have an income coming in and can continue in my current profession until/unless I'm lucky enough to find a flying job. If I were you I would give this route some serious consideration.

Have a read of the CTC wings thread as there are some posters purporting to be EZY first officers complaining at dire levels of pay during their contracts.

[McWho]

Thanks for the reply, I've no prior relationship with an airline. Apart from the highly prized BA scholarship which doesn't require self funding and the FlyBe part-scholarship I'm not aware that it's possible to secure a position with an airline prior to embarking on the integrated courses?

The modular route does appeal, but from what I've read certain airlines will not consider you unless you are a cadet on an integrated course.

My job is stable, I have good prospects in my present industry.

I'm aware from having spoken to students and the bank that a lot of cadets take out a loan for the full amount to cover the course costs. The FTO did advise that often, students will contribute somewhere near £25k towards the costs.

[PURPLE PITOT]

"students", unless tagged, will contribute 100% of between £100 and £130k.

Thats the reality.

[McWho]

I really find it hard to believe that the students contribute 100% from their own pocket, from what I've seen the average age of the students/cadets joining the FTO cadet schemes are mid-to-late 20's, unless they're extremely gifted or talented and have a high paying job, or perhaps from a wealthy background how could they have accumulated the finances? I'd expect only a handful of applicants come from wealth, but I could be wrong.

It's not in the FTOs interest to let students go unemployed. And if students are taking on the risk and debt by commencing these integrated courses for every failure there must be many success stories, surely?

[Big Pistons Forever]

And if students are taking on the risk and debt by commencing these integrated courses for every failure there must be many success stories, surely?

Sigh, mind made up and another life about to be ruined. :(

[FokkerGirl]

I'd expect only a handful of applicants come from wealth, but I could be wrong.

I worked at a flying school that did both integrated and modular training. There were definitely a handful of students who were funded by their parents. Some were wealthy, and some were middle class but came up with the money through mortgaging their home. Other students worked for several years to build up the funds, one student I remember quite well used the inheritance from his deceased parents. Some students were able to get loans.

It's not in the FTOs interest to let students go unemployed. And if students are taking on the risk and debt by commencing these integrated courses for every failure there must be many success stories, surely?

Of course our school would have liked a 100% success rate, because it is good advertising. The truth was that the number of students that found jobs was extremely low... about two per year since the crisis hit. Regardless, the school would promote the success stories of the few... and the masses would sign up thinking that they could beat the odds and be the next success story. It is amazing how blind people can become by a little bit of optimism.

[bucket_and_spade]

Hi McWho,

I'm where you probably want to be in about 6 years i.e. in my fifth year with a large UK airline. I was on a 'tagged' airline scheme and trained at a well-known UK flight school. I was liable for the course costs. Not being rich I had to take out a large loan.

I was fortunate and got offered the job straight out of training and didn't pay for the type rating. I see, on average over the year, around £4k hit my bank account each month i.e. I am not destitute by any measure. My only debt is the flying-related one - about £1k a month (there's still about 4-5 years left of repayment). I rent a small 1-bed with my girlfriend in the south-east as we both work out of London airports (I see you're in the north but remember that while following the work you might be paying substantially more in living costs). We don't live particularly extravagantly.

The problem is we are still really struggling to save a deposit and get a mortgage for a family starter home in the south-east. Despite me being in the top 5% of earners in the UK. The big issue is the HUGE unsecured outstanding debt, relative to most other people. Out credit ratings are fine.

My point is that I made an informed decision to go down this path a few years ago. I weighed up the risk/benefit and did it. It's worked out for me and I don't really regret it BUT I had no REAL idea, 6-7 years ago, what such large loan repayments meant and how drastcially they affect your life, especially if you have any plans to do the normal stuff that comes with a successful career - find a partner, drive a decent car (mine's a 10-year old battered Audi), buy a house, have kids, etc. These things seemed very distant when I was going through selection...

We'll get there eventually with the house but a lot more saving/thrift will come first. It can be tough some times. I'm not complaining, I'm a HELL of a lot better off than most, especially in the current climate, but it's important that you make peace with yourself over these things now if you think they may be important/relevant later.

Good luck in whatever you decide.

[Thesultanofping]

FokkerGirl, about two a year out of how many? Approximately?

[flyboy1818]

I took the grass roots approach, I worked in flight operations on a four on four off basis and I now instruct part time whilst working as a manager within the Aviation industry. My debt is less than 20K and will be repaid in 18 months. I know I don't have an airline job at the moment, but thats not a problem as the industry will recover and my flying hours are increasing all the time due to the instructing.

The amounts talked about here are amazing, did someone really just say 130K!!!

Please don't do this, save some money and go modular. The 10k you have saved up is a good start!!!!!

[FokkerGirl]

@thesultanofping,

In the past 3 and a half years, one graduate went to Susiair, one to an orange colored LoCo via CTC wings, one to another LoCo in continental Europe, and one to a middle east airline (with the help of a very strong internal recommendation). Our school also hired two graduates as FIs.


In those 3.5 years, I estimate that we produced close to 70 pilots (I don't have the exact figure). Keep in mind that we are a small FTO located in continental Europe. If you go to one of the big three UK schools, you may increase your chances of getting hired via one of their partnered schemes, but I think that our school's statistics represent a realistic picture of the overall situation in Europe.

[RexBanner]

I'm writing just to give you my particular experiences with the loan repayments. However please note that my situation is a particularly unique one. I initially applied for the Professional Studies Loan with HSBC back in May 2008. It was for £50,000 and secured (stupidly) against my parents' property. I did my flight training at Oxford Aviation Academy (I was not tagged) from September 2008 to March 2010. The Global Financial Crisis began hitting hard right at the time we were commencing ground school and, from that moment, job prospects for prospective ab initio First Officers went out of the window. To cut a long story short, I was INCREDIBLY fortunate to have found employment with Flybe within more or less six months from finishing my MCC Course. This owed everything to right place right time and having the right housing qualifications for a job in Jersey (my home). All this is irrelevant information to the loan repayments however it paints the portrait of just how fortunate I was.

Now, loan repayments. As of the 20th November, I have moved onto the third year of pay points within the Flybe Dash FO scale. I now earn a basic of £33,600 (more or less) and together with Flight Pay brings my gross salary per annum to roughly £36,300. Because Jersey is my home I am still (sadly) living at home with parents in order to make ends meet. Jersey tax is on a sliding scale upto a max of 20% so my net salary per month is £2,400. I give my parents £400 a month for rent. The loan is based on an interest rate tracking the base rate plus roughly 2.75% so in total 3.25%. Which means the monthly repayments are £469.29. Not crippling by any means but bear in mind still I did not have to pay up front for a type rating and the loan is "only" £50,000. Bear in mind also that these tracker loans are gold plated because they predate the financial crisis, banks will not be anywhere near as generous these days. Because living with my parents has left me with some spare cash I have ploughed pretty much all of it into the loan as extra repayments. The outstanding amount left on my loan now is roughly £20,000 which I will hopefully have paid off in July 2014, seven years early.

I have gone a bit overboard on the detail here but this is merely to point out that I have been incredibly fortunate in terms of the loan and also gaining employment without type rating costs. I am also fortunate (not socially but still fortunate financially) to be able to live with parents whilst paying back the loan. But the crux of all this information I have given you? I STILL FEEL THE PAIN. I cannot imagine the stresses that must be upon those people who are in the hole for over £100k. I have £20k of debt, a fraction of this amount and yet I still panic over what's going to happen if the worst happens and I lose this job. I should NEVER have used parents property as security, it was a foolish decision. The only thing that saved me is I got lucky. Do you really want to take that gamble? Even the small sum of £469 coming out of your account before you see it is incredibly limiting as I have experienced. And yet people taking out loans now will never have it as good as me in terms of size of repayments.

With paying £1000 a month extra into the loan I have had a taste of what it must be like to have that extra liability to my name. And it is not fun!! When you are counting the pennies EVERY SINGLE MONTH and your friends take the piss out of you for being a tight arse continually and ask you for the umpteenth time why you are not going out at the weekend. And I could stop this at any time and just make the minimum repayment. For the CTC Flexicrew lot THIS IS THE MINIMUM REPAYMENT and you will be doing it for over TEN YEARS. My situation is just a two year taster to get the smaller loan paid off quickly. The stresses of having this situation perpetually for the next ten years is horrific.

This industry is dead as a worthwhile career choice. And it is dead not only because of the current and future price of Oil. It is dead because of the people who make unwise financial decisions and then have to prostitute themselves and live on the breadline in order to save their dream and make ends meet. This will have inevitable detrimental consequences for pay in the left hand seat too. You want my HONEST opinion? Do not do it, the ends are not worth the means. I love the flying but at the end of the day you realise after six months it's just another job, albeit one with a better view than most.

[Halfwayback]

McWho
I am sure you will agree that you have had some full and helpful answers from both sides of the spectrum so before this deteriorates into a P2F debate I am closing the thread

HWB