Mortgage on an Aircraft.

[Iwasoneonce]

Is one able to take out an aircraft mortgage? Similar to a Marine mortgage is guess where one doesn't have to put up a "fixed asset" as security.

Or am I out of touch with reality?

[2high2fastagain]

Yep, think you can. There's a 'Mortgaging of Aircraft Order' 1972. When I bought my aeroplane, the CAA did a search for me on the UK Register of Aircraft Mortgages to see if the aircraft had any entries against it.

[FlyingStone]

Many airlines do it, probably it could be done for a private owner as well...

[niknak]

You can apply for a mortgage to buy an aircraft, but it would be the security against the loan.

Have a shufty at this:

AIRCRAFT MORTGAGES – An Introduction (http://www.sykesanderson.com/Corporate/articles/aircraft_mortgages.asp)

As with any mortgage, there's a mirad of small print and I imagine that the TV & fees are very similar to current property mortgages.

If you go ahead with it, it would be interesting to know how you get on and the process.

[Monocock]

You want to give Lombard a call. I looked into it when I was thinking of buying a new Husky a year or two ago. However, you won't be able to mortgage anything less than around £100k in value as below that it isn't worth them doing it. Payment terms can be up to 20 years mind so it can be relatively affordable but do watch the kind of interest you are being charged on anything more than 5 years - it can be horrific.

I decided against it as I couldn't bring myself to pay such a buge sum of interest.

[Iwasoneonce]

Thanks for the input.

Looks like it will have to be cash or nothing.

[Pilot DAR]

I tried to use my plane as assurity for a line of credit for half the book valuse of the plane. The bank said no. If they had to reposess it, they would not know how to sell it to recover the value. I took in two letters from qualified buyers, saying they would buy the plane from the bank at any time for twice the assurity value. The bank still said no. This was a bank I'd been with for 15 years. So I gave up, and changed banks.

Perhaps things are different now, but I'm not counting on it, and do not involve my bank in my aviation. What the bank does not know, won't hurt me - after 23 years, and 2600 hours flying, the plane is still worth at least three time what I paid for it!

Plan for paying cash...

[niknak]

I think DAR has hit the nail on the head there.

Buying or selling anything that has a mortgage or a charge on it can take ages and can come back to bite you if someone along the line has been less than honest.
Cash greases palms and makes the world go round that much faster.