AOPA Pilot Magazine - May 2016 - 114

NEWS & NOTES
AOPA AVIATION FINANCE

MEMBER BENEFITS

Usage matters
The bank cares how you operate your aircraft
WHY DO YOU FLY? To a lender, the question matters. As
a purely recreational pilot, structuring a financing deal
is relatively straightforward. But if you fly for business
or use your airplane in a business, things are about to
get a lot more complicated.
"The structure of any deal will be based on usage,"
says Adam Meredith, president of AOPA Aviation
Finance. There are a number of reasons usage is
important.
Let's say you're a pilot who flies 100 hours a year personally or under Part 91 in your business. The bank will
expect a certain depreciation of the airplane based on
that assumption. If you fly 400 hours a year instead with
some Part 135 charter usage, the airplane loses value
faster than the bank expects, and any default might put
the bank in a position of losing money on its loan. To
avoid the risk, banks will require a higher down payment or a shorter term for higher usage, Meredith said.
Commercial use is a little trickier. AOPA Aviation
Finance can work with lenders to finance a flying club
airplane, which is an unusual service, Meredith said.
Flight school airplanes are more difficult to finance.
"If an asset is necessary for the business, there's a
conflict," he said.

ADAM MEREDITH

AOPA Aviation Finance

If a club defaults on an airplane, the club simply finds
a new airplane or disbands. But if a flight school loses an
airplane, it also loses its primary revenue source, making
it nearly impossible to pay back the loan. Default history
plays into it as well, and flight schools have historically
had a higher default rate than individual owners or flying clubs.
The bottom line? Meredith and the staff at AOPA
Aviation Finance have the relationships and the expertise
to get a deal done, and they love a challenge. If you've had
difficulty getting a flying club airplane or unique model or
usage case financed in the past, give the AOPA Aviation
Finance staff a call.
Considering aircraft ownership? AOPA Aviation
Finance will make your purchase experience as smooth as
possible. For information about aircraft financing, please
visit the website (www.aopafinance.com) or call 1-800-62PLANE (75263).
WEB

www.aopafinance.com

CONTACT AOPA
ADDRESS CHANGE?

AOPA FOUNDATION

AOPA AIRCRAFT INSURANCE

421 Aviation Way
Frederick, Maryland 21701-4798

AIR SAFETY INSTITUTE

AOPA PILOT PROTECTION SERVICES

AOPA CREDIT CARD PROGRAM

AOPA RENTAL CAR PROGRAM

Send your new address and AOPA
membership number to AOPA:

Fax: 301-695-2375
www.aopa.org
TOLL-FREE PILOT
INFORMATION CENTER

800-USA-AOPA (872-2672)
www.aopa.org

800-955-9115
www.aopafoundation.org
800-638-3101
www.airsafetyinstitute.org
800-523-7666
www.aopa.org/creditcard

800-622-AOPA (622-2672)
www.aopainsurance.org
800-USA-AOPA (872-2672)
www.aopa.org/pps
866-315-9155
www.aopa.org/cars

AOPA AIRCRAFT FINANCING

800-627-5263
www.aopafinance.com

AOPA PILOT INFORMATION CENTER HOURS

Do you have questions or need information about an aviation topic? Access the team of aviation experts in our Pilot Information Center
during our convenient weekday hours. Call 800-USA-AOPA (872-2672) Monday through Friday, 8:30 a.m. until 6 p.m. Eastern time, with
your questions and our staff will be happy to assist you.
WEB Visit the website (www.aopa.org/aopapremier) to learn about upgrading to the AOPA Premier membership.

114 | AOPA PILOT May 2016

http://www.aopafinance.com http://www.aopafinance.com http://www.aopafoundation.org http://www.aopainsurance.org http://www.airsafetyinstitute.org http://www.aopa.org/pps http://www.aopa.org http://www.aopa.org/creditcard http://www.aopa.org/cars http://www.aopa.org http://www.aopafinance.com http://www.aopa.org/aopapremier

Table of Contents for the Digital Edition of AOPA Pilot Magazine - May 2016