Banks and loans - credit crisis?
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Please take a look at the financial landscape around you and don't limit that to your own personal credit worthiness or rating. The banks are going through a squeeze to say the least and that will most definately impact not only on whether you get the loan but at what cost and yes a loan like any service has a 'price'. Many on here are blinkered by their training and that is indeed a fundamental part of this argument but must be balanced with your everyday commitments and needs.
Please think about your actions in the longer term as many on this thread have already advocated. This whole 'short cut' mentality isn't necessarily bad but can also prove rather more costly in the longer term.
Best of luck whatever you choose.
Please think about your actions in the longer term as many on this thread have already advocated. This whole 'short cut' mentality isn't necessarily bad but can also prove rather more costly in the longer term.
Best of luck whatever you choose.
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Absolutely true.
FTOs will try to sell you expensive integrated courses with solgans like 'where you train makes a difference to where you go' etc.
Well, I have spoken to a few training captains in my time and a number of other pilots ranging from line captains to instructors. The message is usually the same: don't be taken in by it because it's not true at most airlines.
When you have unfrozen your licence that is especially true.
Pay for your licence by working now, because you sure as hell won't pay the loan off on a TP/instructor starting salary, and would even probably struggle on a jet salary.
Making the decision to become a pilot is life-changing: just make sure it changes your life in the right way!...see below:
As a stark reminder to everyone: I was approached by a Big Issue seller a few months ago who noticed the Seiko Chronograph on my wrist-he asked me if I was a pilot and I explained I was hoping to go commercial soon. He explained that he had done a similar thing and come financially unstuck with loans and credit.
In the words of the lottery...'it could be you'
B
FTOs will try to sell you expensive integrated courses with solgans like 'where you train makes a difference to where you go' etc.
Well, I have spoken to a few training captains in my time and a number of other pilots ranging from line captains to instructors. The message is usually the same: don't be taken in by it because it's not true at most airlines.
When you have unfrozen your licence that is especially true.
Pay for your licence by working now, because you sure as hell won't pay the loan off on a TP/instructor starting salary, and would even probably struggle on a jet salary.
Making the decision to become a pilot is life-changing: just make sure it changes your life in the right way!...see below:
As a stark reminder to everyone: I was approached by a Big Issue seller a few months ago who noticed the Seiko Chronograph on my wrist-he asked me if I was a pilot and I explained I was hoping to go commercial soon. He explained that he had done a similar thing and come financially unstuck with loans and credit.
In the words of the lottery...'it could be you'
B
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Again another excellent thread, should be made a sticky once more I think. Same as the ' Where are all the jobs' thread.
A lot of true and brave stories. Two threads here I think that anyone getting in to flying training should read.
What do you think WWW ?? Maybe rename it, 'Financial implicications of flight training' perhaps. Once again thanks to all who have contributed.
Im going down the instructor route, better chance of a job and far less risk.
A lot of true and brave stories. Two threads here I think that anyone getting in to flying training should read.
What do you think WWW ?? Maybe rename it, 'Financial implicications of flight training' perhaps. Once again thanks to all who have contributed.
Im going down the instructor route, better chance of a job and far less risk.
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All good points guys but whether we're saving up or getting a loan your potential for success depends upon thorough planning.
Mr. Big Issue might have thrown his heart and ability into his training but maybe he had nothing to fall back on (in terms of vocational experience in another area or financial assets).
Although I don't own the house I live in, I do own one that I rent out and have accrued a decent amount of equity. If I fall on hard times, I can sell that. I am also qualified and experienced in purchasing, which I can go back whilst applying for pilot jobs.
We're all individuals following the same goal and we'll chose to do it in different ways, in spite of the advice we give each other.
Those of us that plan carefully for every eventuality have a better chance of succeeding. Those of us who jump in head first may end up selling the big issue (and without forward planning and a meticulous nature how good a pilot will they become anyway?!!)
I agree, this thread should be a sticky!
L A
Mr. Big Issue might have thrown his heart and ability into his training but maybe he had nothing to fall back on (in terms of vocational experience in another area or financial assets).
Although I don't own the house I live in, I do own one that I rent out and have accrued a decent amount of equity. If I fall on hard times, I can sell that. I am also qualified and experienced in purchasing, which I can go back whilst applying for pilot jobs.
We're all individuals following the same goal and we'll chose to do it in different ways, in spite of the advice we give each other.
Those of us that plan carefully for every eventuality have a better chance of succeeding. Those of us who jump in head first may end up selling the big issue (and without forward planning and a meticulous nature how good a pilot will they become anyway?!!)
I agree, this thread should be a sticky!
L A
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But yes L A James, you have planned and know what you risking. If it all goes t*ts up you will lose this and that, but you already know the risk.
Therefore in my view, you are going into this with your eyes open and risks known in the knowledge that you are prepared to risk what you have worked for and earned. That is absolutely the right attitude and shows that you have a bit of business sense as well: something airlines will appreciate when you finally get there: which with your pragmatic approach you probably will.
I think two of the key point here are those who:
a) try to get loans with little or nothing to fall back on
b) the sub-issue of those who get loans with the intention of defaulting.
If you have nothing to fall back on and can't get hired for some reason after completing, then the question people in category (a) should be asking is: where is the money going to come from?
Those in category (b) won't care one way or the other!
But it's the few short-sighted folk in (b) who have made it harder for everyone else I'm afraid.
Vote number 3 for a sticky-perhaps merged with the similar thread that's already a sticky!
Bri
Therefore in my view, you are going into this with your eyes open and risks known in the knowledge that you are prepared to risk what you have worked for and earned. That is absolutely the right attitude and shows that you have a bit of business sense as well: something airlines will appreciate when you finally get there: which with your pragmatic approach you probably will.
I think two of the key point here are those who:
a) try to get loans with little or nothing to fall back on
b) the sub-issue of those who get loans with the intention of defaulting.
If you have nothing to fall back on and can't get hired for some reason after completing, then the question people in category (a) should be asking is: where is the money going to come from?
Those in category (b) won't care one way or the other!
But it's the few short-sighted folk in (b) who have made it harder for everyone else I'm afraid.
Vote number 3 for a sticky-perhaps merged with the similar thread that's already a sticky!
Bri
cfwake wrote: WWW
"On one level I cannot advocate it as it is illegal"
!!
Robbing cars is illegal too!
A trifle trite I feel.
Stealing a car is the theft of a good for which another person has paid to own. Morally and legally this is a stark injustice.
Going bankrupt deliberately after accepting freely offered credit is less stark.
The credit was extended purely with a view to extracting profit. In most developed cultures society places a level of responsibility on lenders not to lend recklessly. To do so is to drag the ignorant, unfortunate or naive into unmangeable indebtness from which they may never escape and which might result in family breakdown, crime and suicide.
To offer a 19 yr old a credit card with a £10k limit, an 'any purpose' £10k loan and a £2k overdraft is entirely common. Even if they are a student. On a crap course at a crap 'university'.
To push your credit a bit and borrow enough to pay for a modular CPL/IR is only a small step beyond normal.
One could take the view that the willing lenders are totally dispensing with any obligation to lend responsibly.
One could then take the view that the willing borrowers could dispense with their obligation to re-pay responsibly.
The two wrongs a fairly evenly balanced.
The law of course is written by the friends of the lenders and is unequivocal. Planned bankruptcy is illegal and the penalties are harsh and include lengthy prison terms.
In reality 99.9% of people will walk away scot free and there isn't a judge in the land who'd send a teenager to jail for fraudulent bankruptcy even if they privately thought they'd done it. Few judges or magistrates have much sympathy for the loan consolidation firms or the big name banks.
I welcome anybody expressing any opinion on this subject and I feel its open and full discussion is to the benefit of all. So wade in.
Cheers
WWW
"On one level I cannot advocate it as it is illegal"
!!
Robbing cars is illegal too!
A trifle trite I feel.
Stealing a car is the theft of a good for which another person has paid to own. Morally and legally this is a stark injustice.
Going bankrupt deliberately after accepting freely offered credit is less stark.
The credit was extended purely with a view to extracting profit. In most developed cultures society places a level of responsibility on lenders not to lend recklessly. To do so is to drag the ignorant, unfortunate or naive into unmangeable indebtness from which they may never escape and which might result in family breakdown, crime and suicide.
To offer a 19 yr old a credit card with a £10k limit, an 'any purpose' £10k loan and a £2k overdraft is entirely common. Even if they are a student. On a crap course at a crap 'university'.
To push your credit a bit and borrow enough to pay for a modular CPL/IR is only a small step beyond normal.
One could take the view that the willing lenders are totally dispensing with any obligation to lend responsibly.
One could then take the view that the willing borrowers could dispense with their obligation to re-pay responsibly.
The two wrongs a fairly evenly balanced.
The law of course is written by the friends of the lenders and is unequivocal. Planned bankruptcy is illegal and the penalties are harsh and include lengthy prison terms.
In reality 99.9% of people will walk away scot free and there isn't a judge in the land who'd send a teenager to jail for fraudulent bankruptcy even if they privately thought they'd done it. Few judges or magistrates have much sympathy for the loan consolidation firms or the big name banks.
I welcome anybody expressing any opinion on this subject and I feel its open and full discussion is to the benefit of all. So wade in.
Cheers
WWW
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The people who are stating "why not just go out and get a well paid job" have they got a mortgage?? I've got a well paid job but a mortgage and family and there no chance i could afford it all without re-mortgaging. Living with mum n dad i'd piss it though
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Just as a recent update to this ongoing thread...does anyone know of lenders who offer small unsecured loans?! (small as in about 15k). I'm paying for my professional training in Canada off my own back, yet will need money once i'm back later this year to convert to JAA. Seems like traditional lenders who offer money for professional development do not view pilot training as worthy enough!
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Stealing a car is the theft of a good for which another person has paid to own. Morally and legally this is a stark injustice.
Corporates do not own themselves, people do.
Can we no longer persue this utterly foolish suggestion of planned bankruptcy.
I know wannabes that have done it.
It works.
And its of wider interest to all Wannabes because the brutal fact is that they are up against these people in the job market. As these people have managed to dispense with their £60k training costs they are able to work for free or pay for their type ratings or both.
Honest Joe Wannabe would do well to understand this.
Cheers
WWW
It works.
And its of wider interest to all Wannabes because the brutal fact is that they are up against these people in the job market. As these people have managed to dispense with their £60k training costs they are able to work for free or pay for their type ratings or both.
Honest Joe Wannabe would do well to understand this.
Cheers
WWW
Educated Hillbilly
Bluepeely,
Loads of us have postponed homeownership for the sake of funding pilot training, you have to accept you can't have everything in life, furthermore if you knew that flying was your ambition why did you laden yourself with commitment that you knew would hinder your progress?
Also there are plenty of us who managed to fund this without "living at home with the parents" (although not debt free my debts are only in the region of 12000, due to the fact that ppl, hour build and distance learning ATPL were all completed while still working). Its a level that is manageable such that I was able to become a full time instructor this summer.
If you have a mortgage and are in a position to remortgage then it probably one of the best ways to finance the training, at least you still have an asset to go with the debt accrued though the flight training, in which case you are in a better situation than most.
Loads of us have postponed homeownership for the sake of funding pilot training, you have to accept you can't have everything in life, furthermore if you knew that flying was your ambition why did you laden yourself with commitment that you knew would hinder your progress?
Also there are plenty of us who managed to fund this without "living at home with the parents" (although not debt free my debts are only in the region of 12000, due to the fact that ppl, hour build and distance learning ATPL were all completed while still working). Its a level that is manageable such that I was able to become a full time instructor this summer.
If you have a mortgage and are in a position to remortgage then it probably one of the best ways to finance the training, at least you still have an asset to go with the debt accrued though the flight training, in which case you are in a better situation than most.
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The people who are stating "why not just go out and get a well paid job" have they got a mortgage??
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Good point Token Bird! My rent is however, cheaper than I would pay on a mortgage had I bought the place. Don't tell my landlord that though!
But yes, my bills etc and rent come to about £650-700 a month. So yes, we all have responsibilities!
B
But yes, my bills etc and rent come to about £650-700 a month. So yes, we all have responsibilities!
B
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So the figures thus far from a neutral point of view stack up (roughly) at something like £600 for rent/mortgage, training loans £450-ish (very rough estimate dependant on individual circumstances). BUT it doesn't end there because first off those figures above are somewhat conservative and doesn't take into account 'living' money, whether you like it or not (i.e. fooling yourself into thinking "ah I don't need to worry about that") it does exist and you will definately need to budget for it. If you have a family or even a relationship then you'll to allocate something but that simply takes the total North of £1000 and that's just to break even!
People are still planning with a far too rosy picture of "it'll be alright on the night" notion, it might seem like it from this side of the fence but I doubt it.
Even if you do get a job a huge chunk of your salary will dissipitate to repay and once again that's not including all the demands of a family or girl/boy friends.
If you're not careful and realistic you can very easily find yourself in a spot of poo-poo. I'm not having a go at anyone in particular just trying to keep people frame of mind clearly focused on realistic expectations.
People are still planning with a far too rosy picture of "it'll be alright on the night" notion, it might seem like it from this side of the fence but I doubt it.
Even if you do get a job a huge chunk of your salary will dissipitate to repay and once again that's not including all the demands of a family or girl/boy friends.
If you're not careful and realistic you can very easily find yourself in a spot of poo-poo. I'm not having a go at anyone in particular just trying to keep people frame of mind clearly focused on realistic expectations.
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See post 55 of this thread for the figures I posted. They are conservative from the point of view that they don't include living money etc. and also they assume that you will get a job: a big assumption.
Although my figures presented there just add-up and say you might be able to pay off the loan and live, it's close enough that I wouldn't do it-a small interest rate increase (as recently) and you'd be stuffed.
Another point for you there-could one afford a 2%-5% increase in interest rates over the repayment period? Don't forget that rates are presently on the increase (though slowing): increased interest rates on loans and mortgages is real and has to be planned for.
Although my figures presented there just add-up and say you might be able to pay off the loan and live, it's close enough that I wouldn't do it-a small interest rate increase (as recently) and you'd be stuffed.
Another point for you there-could one afford a 2%-5% increase in interest rates over the repayment period? Don't forget that rates are presently on the increase (though slowing): increased interest rates on loans and mortgages is real and has to be planned for.
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This is just my 2 pence worth..
I am currently at the stage where I am trying to save my a**e off to get every penny to pursue this long awaited dream. It is easy for all of us to say that 'I have wanted this ever since I was a child' or 'flying is my dream'. I am in a well paid job with a top IT consultancy and will be looking to make the move into the 'contract' market asap.
It phases me when youngsters who are thinking of putting up their parents house as security or taking out extensive credit card, loan debts without asking the more humbling and realistic quesiton of 'How long will my dream last if I dont get a job at the end and have 70k to pay back'.
Set yourself realistic expectations and manage the risk accordingly. I am 27 and indeed working for another 2-3 years to save the money will put me in my early 30s. Will it do me any harm? Probably not, as I hope to have no debt at the end of it and make sufficient contacts.
Flying is more than 'pushing buttons', The Big Academies are money making machines and if a smaller FBO is offering you the same opportunity then it makes you think....
Fact: Credit is big business and a part of life, it is how you manage Credit that is 'critical'.
Fact: Credit can 'ruin' you especially if you have no backup option.
Having graduated from University and with racked up credit cards, SL's and other expenses (which have been all cleared) it quickly became apparant that I certainly have no desire to be paying back over a 10 year period.
But I went through the university process to ensure I have sufficient means to pay back and a stable career, if I dont end up in flying... It is still a 'realistic dream'..
Scoobster
I am currently at the stage where I am trying to save my a**e off to get every penny to pursue this long awaited dream. It is easy for all of us to say that 'I have wanted this ever since I was a child' or 'flying is my dream'. I am in a well paid job with a top IT consultancy and will be looking to make the move into the 'contract' market asap.
It phases me when youngsters who are thinking of putting up their parents house as security or taking out extensive credit card, loan debts without asking the more humbling and realistic quesiton of 'How long will my dream last if I dont get a job at the end and have 70k to pay back'.
Set yourself realistic expectations and manage the risk accordingly. I am 27 and indeed working for another 2-3 years to save the money will put me in my early 30s. Will it do me any harm? Probably not, as I hope to have no debt at the end of it and make sufficient contacts.
Flying is more than 'pushing buttons', The Big Academies are money making machines and if a smaller FBO is offering you the same opportunity then it makes you think....
Fact: Credit is big business and a part of life, it is how you manage Credit that is 'critical'.
Fact: Credit can 'ruin' you especially if you have no backup option.
Having graduated from University and with racked up credit cards, SL's and other expenses (which have been all cleared) it quickly became apparant that I certainly have no desire to be paying back over a 10 year period.
But I went through the university process to ensure I have sufficient means to pay back and a stable career, if I dont end up in flying... It is still a 'realistic dream'..
Scoobster
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Unfortunately for me and due to bad decision making in my younger more "rebelious" days I have a useless credit rating which basically rules me out of any substantial borrowing. The really annoying thing is that my total debt is approximately 3k, very little in comparison to alot of people and I hope to have this cleared by xmas time.
In the mean time I'm planning on finishing my PPL before the end of the year, ideally by the end of the summer but certainly by the end of the year. This will enable me to embark on the ground school, I work in a place where the manuals will be freely available to me so I have to take advantage.
My salary is not very good at the moment but I have calculated and re-calculated and I cant see why it's impossible to do the training modular and "pay as I go". I would like and am trying to arrange a cdl which would pay for the hour building, whilst doing this there is no reason why I cant save the amount needed for the CPL, even on a relatively low salary. The problem might be attaining the funds for the IR for which I will have to think of a plan. Even if the cdl doesn't come off then I'll just have to pay as I go there too, I already have 54 hrs (not really alot I know) but its a 3rd if the way there.
In the mean time I'm planning on finishing my PPL before the end of the year, ideally by the end of the summer but certainly by the end of the year. This will enable me to embark on the ground school, I work in a place where the manuals will be freely available to me so I have to take advantage.
My salary is not very good at the moment but I have calculated and re-calculated and I cant see why it's impossible to do the training modular and "pay as I go". I would like and am trying to arrange a cdl which would pay for the hour building, whilst doing this there is no reason why I cant save the amount needed for the CPL, even on a relatively low salary. The problem might be attaining the funds for the IR for which I will have to think of a plan. Even if the cdl doesn't come off then I'll just have to pay as I go there too, I already have 54 hrs (not really alot I know) but its a 3rd if the way there.
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The other side of the coin