Favourite thread!!!!
Hi guys!
This is a good thread. Just some pointers from one who considers themself lucky to have ducked out of a £63K loan and integrated ATPL 2 weeks before commencement:
1) There is currently no 'off the shelf' loan product for this sort of thing, so HSBC Branch managers have discretion as to how and what they lend their own customers. You can usually swap branches if an existing customer, or just sign up there and then as a new customer. It's a case of phoning around until someone says yes.
2) A £63K loan = £77K repayment. That's a lot of money, so you'd better make sure you have a guaranteed source of income from 6 months after graduating (or failing!) for the next 10 years, which will cover living expenses and £870+ per month in repayments. You'll probably need a further £20-30K spare to pay for the type-rating and extra hours you might need to get a job.
3) A secured loan is better than a guarantee. It limits the liability to the secured amount (i.e. your parents will lose their house), whereas a guarantee will allow the bank to chase your guarantor for the entire debt, plus interest, plus any further debt you ever have (i.e. your parents will lose their house, their car, the clothes off their back and everything else). The liability is endless. Get a solicitor to check the small print.
4) The bank takes no risk. £60K is virtually nothing to the bank, when you consider this is a minority market, and the loan agreements are watertight. The man who sells you the loan will probably have moved on and upwards in a few years, so despite any reassuring words, the bank WILL come after you if you default, and they will hold you to the loan agreement you have signed.
5) The bank couldn't give a stuff about your flying career. They want your business now and in the future because whether everything works out for you, or whether they have to chase you through the courts and repossess your grandmother, by tying you to a loan agreement, they stand to make at least £14,000 in interest and have you by the short and curlies for every future financial product you might need or want.
6) Fuel prices are going up. So could the cost of your training. I've seen it happen before, and that possibility will be included in your training contract, which is fair enough, but read it carefully so that you can allow for it.
There's more, but I hope this is useful in helping you make the right decision...
Best of luck.