So you’re thinking about buying an aircraft. Well here are some practical tips and legal things to think. The first thing to think about is what purpose will your aircraft be used for. Recreational? Business? Transportation? This will be the first step into looking at the right type of aircraft. Do you need reliable business transportation? Will you need your new aircraft to be IFR equipped, be able to fly in known icing conditions, will you need a turbo-charged aircraft? All of these factors will affect the price.
The next question will be how much can you afford. Money is almost always a factor in purchasing an aircraft. You also need to think about how much it will costs to maintain, insure and hanger your aircraft. If you are looking for a weekend flyer, many single engine aircraft can be purchased for as little as $20,000. Get your free insurance quote today!
You will want to look at three different types of costs. The first is your fixed costs – costs that do not change with the number of hours flown. Fixed costs include loan payment and interest, insurance, hangar costs, costs of your annual and registration fees. You should choose an insurance company and get a quote prior to your purchase. Some of these costs can be offset by renting your aircraft, but I will talk about that in a minute.
The second set of costs you will look at are your variable costs – costs that vary based on the number of hours flown. Variable costs include fuel, oil maintenance and reserves. You should estimate how many hours you will fly each month, then calculate how much it cost per hour for fuel and oil etc. Once you have for fixed and variable costs calculated, you may consider parking your aircraft at an FBO and renting it out. Ask how much you would receive per hour if the aircraft would be rented. Finally, calculate how many hours per month your aircraft would need to be rented in order to cover your fixed and variable costs.
The final set of costs are your initial costs – the purchase price of the aircraft plus any applicable sales taxes, as well as the appraisal of the aircraft and any legal fees incurred. Since I just mentioned legal fees, let me highly recommend the use of an aviation attorney. The few hundred dollars you will spend could save you thousands in unexpected fines or maintenance costs down the road. The attorney will also be able to walk you through the aircraft buying process and assist you with the FAA’s required paperwork.
Ok, so you are asking yourself, ‘how much already?’ Well, for a simple fixed-gear single flying 100 hours/year, calculate your hourly fuel expenses and multiply by 2 to get a guestimate of your total hourly costs. For a complex aircraft, multiply by 3. For twins or turbines, break out a calculator.
So you have chosen an aircraft and are satisfied you can afford it. Now you are going to want to research the aircraft history. Start with the FAA Form 337 for any repairs or alterations to the aircraft. Review the Airworthiness Directives to ensure the aircraft is in compliance with the regulations. Also check the aircraft logs. This one is important. If a complete set of logs is not available, assume the worst. A missing log could indicate serious aircraft damage with inadequate repairs. Logs could have been intentionally lost to cover it up. This is not necessarily always the case, but assume the worst.
Next, you will want to perform a title search. This will be a good task for your lawyer. You want to look for outstanding liens against the aircraft. If you buy an aircraft from Joe the pilot, but Joe the pilot still owes ABC dealer money for that aircraft, ABC dealer can reposses that aircraft from you. Keep in mind, aircraft do not have certificates of title as cars do. Also ensure there are no mechanical liens. You can also use the Aircraft History Tool found here.
After all of that research, if you are completely satisfied with the aircraft you wish to purchase, then have a purchase contract drawn up with the following information:
-the make and model of the aircraft
- the serial number and tail number
- the equipment list
- the purchase price
- the closing date
- pre-purchase inspection
- when and where the closing will occur
- which state’s law governs
This will cover you in case anything advertised about the aircraft is incorrect as well as places purchase price in writing allowing for no misunderstanding.
Try not to buy impulsively or fall in love with one aircraft. Do your research and buy smart. You will thank yourself in the long run if you cover your bases prior to purchase and are patient enough to find the aircraft that is perfect for you. It is out there, it’s just a matter of finding it.