Nextant Aerospace launched a financing plan that targets aircraft costing between $2 million and $10 million, a market it says has been underserved by banks in recent years. The company is offering a range of flexible financing packages for customers pursuing the Nextant 400XTi light jet and G90XT twin turboprop. Terms are available from two to 20 years, and a variety of lease types are available. Fixed or floating rates are offered, with fully amortizing or balloon payments.
There is good news and bad news when it comes to financing for pre-owned business aircraft. The good news is that financing is available for aircraft buyers; the bad news is that banks are primarily lending only to those with exceptionally good credit who are buying an aircraft that is less than 20, and even in some cases less than 10, years old, according to a panel of aircraft financiers at the recent NBAA Aircraft Registration, Finance and Legal Conference in St. Petersburg, Fla.
The private aircraft financing market in China has matured over the past several years with many sources of funding available for those wishing to purchase airplanes according to the experts here at ABACE. “I don’t think there is any lack of financing alternatives available,” said Jeffrey Lowe, general manager of aircraft ownership consultancy Asian Sky Group. “Pretty much all the international lenders are here and all the Chinese lender banks are involved in business aviation as well. A lot of them have set up leasing arms, so they are all diving in head first.”
The Aircraft Owners and Pilots Association (AOPA) recently launched AOPA Aviation Finance (AAF) Company, a loan brokerage venture aimed at matching association members who require aircraft purchase financing with suitable lenders. It will also help facilitate member loans for avionics updates, either through straight loans using the aircraft as collateral when it is fully owned, or through refinancing of the aircraft while it is still being paid off.
Attendees at the National Aircraft Financing Association annual meeting late last week in Savannah, Ga., largely agreed that aircraft financing is “thawing,” but new international banking rules that will start to be phased in next year might make things worse.
EAD Aerospace Interiors is not one of the better known completion and refurbishment houses. Its production facility is tucked away in the village of La Bastide-de-Jordans, in the countryside not far from Toulouse and its thriving aerospace industry.
Last year when AIN took a close look at the aviation finance industry, the prevailing sentiment among industry insiders was that if you were looking for money to finance a business jet, the money would find you. At the time, many of the aircraft finance divisions still felt they were relatively insulated from their mortgage brethren, even within the same company.
A number of pilots on NBAA’s Air Mail Internet forum expressed confusion of late over Signature Flight Support’s policy on ramp fees for multiple stops on a given day.
Unlike insurance rates, which are decreasing slightly or at least stabilizing, aviation financing rates have apparently bottomed out and were on the rise last month.
However, like home mortgage rates, interest rates for aircraft are still near historic lows. What direction they go next is impossible to predict accurately, but current economic conditions seem to point in a continued upward direction.
Interest rates for aircraft loans and leases are typically negotiated individually for each case, so lenders rarely publish their rates. Aircraft type, the value of the specific aircraft, its intended use, its location and the financial standing of the client, along with the down payment and length of the loan, all figure into the interest rate.