Paying upfront??

[TheNavigator]

Dear fellow ppruners,

I am currently doing my PPL with SFC and was recently proposed to pay upfront the cost of 45 hours to have a discount of 10%. This mounts to over 600 pounds which is good money.

Knowing that upfront payment is to avoid at all cost I would like to hear some more comments on this one.

The strongest reason for avoiding this is if the schools goes out of business we lose the money. Well, Stapleford have been in business for quite a while and therefore it is unlikely it goes out of business in the next 2-3 months. Well, hopefully....

Are there anymore reasons to avoiding this option? What happens if for example I cannot continue the course due to health problems or accident or even die??? Will the money be returned? Not to me for obvious reasons! :) Are there any other issues I missed?

Your opinions are much appreciated.

------------------
TheNavigator

[This message has been edited by TheNavigator (edited 13 June 2001).]

[Iain]

I suggest not to do it for the reason you mentioned of them going out of business. There was a flight school at LGB (everything flyable?) which went out of business, and the owner ran to the Carribean. Last I heard some people where going down there to confront him, however I never heard the end of that.
Also 10% savings sounds really great, however how much interest would you get if you kept the money in the bank? So you are really not saving 10%.
When I worked at the pilot supply store in CA, I noticed how many students did not complete their PPL. The numbers are much higher then I first imagined.
If you are going to do this, I would think about insurance, but with the cost of that, the interest lost from it not being in the bank, and the risk, does it really seem worth it?
Iain

[Tip tank]

Best to keep your money. If the upside is +600. the downside is -4500 - seems a bit skewed to me.
Anyway, if you are going to go commercial, you will be throwing big blocks of £600 at flight schools without batting an eyelid.

[Tristar Freak]

Is anyone knowing what was ahppeing to the owner of Everything Flyable? Just interested...

[Cypres]

TheNavigator,

my training provider (Ravenair at Liverpool) offer a few options:

1) Pay-up front for the best discount.
2) Pay £1000-00 up front for 10% discount off everything (including landing fees)
3) Pay £3000-00 up front for 12% doscount (not absolutely sure about this last one)

I opted for the £1000 since it gives me a good discount and reduces the amount of risk I am exposed to should Ravenair go bump.

p.s. Ravenair have been great upto now, would recommend them to anyone.

(And no, I don't work for them or intend to in the near future).

[TheNavigator]

Dear friends,

Thanks for the replies so far!

Keep them comming!

Although I seem to hear everyone saying don't do it, I know there are a lot of those who still do it.

I can see a problem if the training is to be spread over a long period, but if it is over a short period of 1 - 2 months ....

But still would like to hear some more opinions please. I need to make up my mind and I am not convinced yet!

Thanks



------------------
TheNavigator

[Whirlybird]

Flying schools can and do go out of business after being there a long time. One wellknown one was expected to recently by those who knew about it; the owner of the land wanted them out and the case was going to court; the guy won on appeal and looks like staying there. The point is it was kept very quiet and not that many people knew what was happening.

Ultimately it depends on your attitude to risk. I've paid for most of my helicopter training in ten-hour blocks to save 10%, and I'll probably carry on like that. I'm aware of the risk - but I consider it's worth it.

Just ask yourself how you'd feel if you lost the money. Could you shrug it off and think: "Ah well, you win some you lose some"? If not, maybe think again.

------------------
Whirly

To fly is human, to hover, divine.

[dumpty]

Isn't there something about paying with a credit card and then the credit card company pay you back if the training org goes belly-up?

I hope so 'cos I just paid 4 and a half grand!

[TheNavigator]

Very good point dumpty! It is worth investigating that one. I will share my findings here.

Whirlybird, my position towards risk is that of controled risk. That is why I am considering this un-popular upfront payment. If the only risk involved is the schools going down, I will probably go ahead and try to book as much flying as possible to reduce the risk. However, since I am thinking of doing the professional training with the same school it would be very bad if they went down within the next 1-2 years! http://www.pprune.org/ubb/NonCGI/frown.gif

I will also approach the school with these worries and see what do they have to say to me.

Thanks for all the replies! :)



------------------
TheNavigator

[scroggs]

When paying for anything over £100 (I think) by credit card in UK, the credit card issuer is liable for the delivery and merchantable quality of the goods. In other words, if your school goes bust and you paid for block hours or a whole course by credit card (not debit cards), then they should ensure you are repaid the amount you are out of pocket and they become a creditor of the dissolved company. As far as I know!

------------------
Scroggs
Wannabes Forum Moderator
[email protected]

[TheNavigator]

There you go! That was the answer I was after! Thanks scroggs!

I assume this is true for any credit card from any bank. I mean, this is consumer protection and not a service provided by the financial institutions. True?

Running to the bank to raise the credit limit!! :)

------------------
TheNavigator

[Dizzy]

To quote a very well known expert on this subject:
"Never, ever, ever pay large sums of money up front - don't do it!"

Sorry to be a wet blanket, but I feel this is good advice. Aviation history is littered with large "respectable" companies that have gone bust overnight.

Best keep one foot firmly on the ground!

[Tigereye]

Credit card companies charge a "small" fee to retailers (flying schools), which is then passed on to the purchaser.
You may find the school won't take credit cards AND give you a discount. http://www.stopstart.fsnet.co.uk/mica/wormsaw.gif

[juswonnafly]

Navigator,

Lots of useful advice here, However I just thought I would stick my nose in for good measure!

He who has the money has the power! What if you find at some stage in your training you are unhappy with the service/quality or you find another school that you prefer......what will you do?

I taught at a school where getting a refund for ANY reason was like trying to get blood out of a stone.

If you wish to limit the liability then 'stage payments' might be best.

It is YOUR money, spend it wisely.

Good luck and enjoy your training.

JWF http://www.pprune.org/ubb/NonCGI/cool.gif

[Grandad Flyer]

Its not only the "school going bust" scenario that you need to consider. What if, once you have paid, they are not able to offer you the bookings you want. What if they are short of instructors, what if they keep putting you off, what if something else happens and you cannot fly, what if you don't get on with the instructor you are allocated and they won't allocate you another, what if something happens in your life and you have to move away from the area?
Would the school just hand you back the money less what you have flown? Would they quibble? Would they try and charge you a higher price for the hours already done so you get less of a refund?
What if you have to give up, as you say, through health reasons, or you are in a car accident and cannot fly.
These are the real things that happen every week in flying schools.
I certainly agree with those who have said pay by credit card. Visa/ mastercard commission is usually around 1 to 1.5% provided the school put a fair volume through. So they should still offer a good discount even with that commission taken into consideration. AmEx is a lot higher commission so they might not accept that.

[Land After]

Protection when paying by credit card comes from section 75 of the Consumer Credit Act 1974; it makes the credit card company liable to the customer for any breach of contract or misrepresentation along with the supplier of goods and services. If the school goes belly-up, they become liable. Protection for purchases outside of the UK is a grey area and it only covers UK issued cards. It does not apply to regular Amex cards as they are Charge Cards – paid in full every month.

Also handy to know for any purchases outside of aviation!

[TheNavigator]

Thank you guys very much for the input!

I understand what most of you are saying, in did I though of all that. I usually don't have the approach of "... it won't happen to me...".

In this case, what is the school's position about this? I will ask them these questions and try to have the answer in writing before handing out this sort of money.

In addition to the credit card protection isn't there any consumer protection mechanism? You are paying for a product or service. If for any reason you don't get the service or product should't you get a refund?

I am sorry to let this subject run for such a long time but I can't resist saving half a grand.

Thanks

------------------
TheNavigator

[humpty]

Good point about making sure you're ok with the flying school before dropping the big wedge up front.

I did a few lessons on a 'per-hour' charge and got to know the place before putting down the big up-front money. OK, so it means I've paid for a couple extra hours but chances of finishing in 45 are pretty slim anyway from what I understand. If I do, then fine, a couple extra hours paid for afterwards.

Might not work for everybody, but seems to be working for me (he says, touching wood....)

[TheNavigator]

I checked today with the school and the policy is to return the money for any unused funds. Any reasons are valid.

If they give this in writing I can not see any reason why not saving this money.

Although, the saving is not as much as I thought initially. The way the discount is calculated is a bit obscure as that are different rates for solo and dual flights. Nevertheless is still above the 300 pounds mark.

------------------
TheNavigator

[pilotwolf]

Hi All,

Seems that I have been very lucky with the couple of schools I used, both at LGB. Both offered block rates of about 10% discount for only $1500 down, which effectively gives you an extra hour for your money. Both took cards, including Amex, and both would happily refund anything left over if you didn't spend it - including coming to the end of the trip and having to return to the UK. Unfortunately one of the schools is no longer there - a good well established school which had internal staff problems closed down - much to the shock of us regulars.

[Sensible]

I have paid upfront on several occasions. I can report both good and bad experiences. At one particular US school which I had previously attended, things went well and truly pear shaped during my second visit. Had it not been for my complete lack of charm and personality, I would have been well and truly "shafted" by the proprietor. Strangely enough, that bad experience was at a school which did not accept credit card payments for advance payments although was willing to accept them for all other payments!! I now don't do business with establishments that don't accept advance payment by credit card!!