Aircraft Financing

Aircraft Financing

Assets America® provides aircraft financing, starting at $5 million, for corporate and commercial aircraft. We are committed to securing your aviation financing. Assets America® personally crafts and closes deals on aviation new builds, purchases, and refinancing for high-value aircraft including jets, turboprops, helicopters and aircraft fleets. When you are considering financing an airplane, look no further than Assets America® for some of the most flexible airplane financing and jet loans in the US aircraft finance market.

Business Aircraft Markets

Corporate

Corporate aircraft are owned and used by businesses for their own purposes rather than commercial enterprises. Typically, corporate aircraft transport individuals connected to the business, including employees, directors, customers, vendors and others. Corporations may own or lease their own aircraft or may make arrangements with a third-party operator. Corporate jets are classified as very light (i.e. Eclipse 550, Cessna Citation M2), light (i.e. Learjet 31/40, Cessna CitationJet, Beechcraft Premier), midsize (i.e. Citation Excel, Learjet 45/60), super midsize (i.e. Gulfstream G200/G250, Challenger 300/350) large (i.e. Challenger 600, Falcon, Legacy) and long-range (i.e. Gulfstream IV/V/G650, Falcon 7X).

Large jets typically carry up to 14 passengers with pricing starting above $30 million, whereas long-range jets carry up to 19 passengers and cost $60 million on average. We will be happy to arrange aviation financing for your next corporate aircraft of $5 million or greater. You’ll find our aircraft financing services superior to what you usually receive from other aircraft financing companies.

Commercial

Commercial aircraft, also known as airliners, are used by carriers to transport cargo and passengers in commercial service. The largest non-military aircraft are commercial aircraft and include wide-body jets with two or more aisles. Smaller jets and narrow-bodies are used for shorter flights, and some carriers employ turboprop aircraft and turbine aircraft for their shortest routes. The three main markets for commercial aircraft are:

  • Scheduled:  These are the familiar carriers including: Delta, United, American and so forth. It also includes regional carriers such as Alaska Air. Scheduled passenger flights sell tickets to passengers, follow pre-established routes and schedules, and offer connecting flights to cover a network of destinations.
  • Charter:  Charters arrange flights on demand for customers. They fly smaller aircraft, although large chartered flights are available using large jets. Customers dictate destinations and schedules. The largest charters are known as VIP airliners and accommodate large groups such as sports teams, press corps and entourages. Makers of VIP Airliners include Airbus, Boeing and Embraer.
  • Freight:  Large cargo carriers like Federal Express and UPS maintain their own fleets of aircraft for hauling freight. The aircraft have been specially fitted to maximize cargo volume consistent with the plane’s weight limits.

Turn to Assets America® for commercial aircraft financing with some of the lowest aircraft financing rates from through our numerous aviation and aircraft financing sources including, but not limited to: commercial finance banks, private money funding, and numerous other sources.

Types of Aircraft Financing we Provide

Assets America® provides aircraft financing from $5 million to $200 million, and much greater for aircraft fleet purchases. We bring aircraft financing and aircraft purchase expertise to companies looking for any type of jet loan, jet lease, or aircraft purchase. Here are the typical aircraft for which we provide aircraft loans and services.

Turboprop

A turboprop is an airplane with a turbine engine that drives a propeller. Unlike a jet, the engines exhaust gases are insufficient to create enough thrust since the energy is used to turn the propeller. A compressor forces air and fuel into a combustor where it ignites, and generates power that drives the propeller and the compressor. Additional thrust is derived from a propelling nozzle that exhausts gases to the outside. The most popular single engine turboprop is the Pilatus PC-12, whereas the leading multi-engine turboprop is the King Air 200.

Turbofan Jets

A jet aircraft has one or more turbofan engines, which are air-breathing jet engines that use a gas turbine to feed mechanical energy into a fan that provides thrust. Only some of the intake air travels through the turbine, with the remainder routed directly to the fan.

We provide airplane financing for a variety of jets, including:

  • Learjet:  The Learjet 70 and 75 are light jets manufactured by Bombardier, a Canadian aircraft maker. Learjets have powerful, fuel efficient engines, winglets and advanced avionics. They hold a crew of 2 to 8 passengers, with a maximum takeoff weight of 21,500 lbs and a cruising speed of 535 mph. The Learjet 70 and 75 cost more than $10M each.

  • Gulfstream:  Gulfstream, a division of General Dynamics, makes a lineup of jets that include the G280, G350, G450, G500, G550, G600, G650 and their top of the line G650ER. All can hold up to 19 passengers except for the 10-passenger G280. The Gulfstream G650 (see image below) is the company’s largest and fastest business jet with a cruise speed of 610 mph, a maximum takeoff weight of 99,600 lbs. and a price of almost $70 million. The 650ER is an extended range version with an additional 4,000 lbs. of takeoff weight.

Aircraft Financing

 

  • Bombardier:  This Canadian aircraft manufacturer makes several business and commercial jets. The largest business jet is the Bombardier Global Express, and commercial jets produced include the Bombardier CRJ series and the Airbus A220 series. The CRJ1000 sells for around $50 million.

  • Dassault:  This is a French manufacturer of the Falcon family of business jets. Its most impressive jets are the Falcon 7X and 8X large cabin tri-jets. Top travel range is 7,400 miles, and individual jet prices are north of $50 million.

  • Boeing:  The Boeing Commercial Airplanes Division makes business jets and airliners. The BBJ family of narrow-body business jets are derived from the Boeing 737 airliner. Wide-body VIP models are based on the commercial 747, 777 and 787 airliners. Boeing also makes the 767 model. The Boeing 787-10 Dreamliner aircraft sells for about $326 million (see image below).

Aircraft Financing 002

 

  • Airbus:  This is a European manufacturer of the A-Series of commercial airliners. The top model is the Airbus A380 (see image below), a huge widebody, double-decker with four jets that is currently the world’s largest passenger airliner!  You can own one for a cool $445.6 million, and we can arrange both the aircraft sale and financing for you.

 

Helicopters

A helicopter is a rotorcraft that can take-off and land vertically, fly in all directions and hover. There are many variations on the design of the rotors, cabins and engines. American helicopter manufacturers include Boeing, Textron (Bell), Lockheed Martin (Sikorsky), MD and Kaman. A typical executive helicopter is the Lockheed Martin Sikorsky S-76D (see picture below) powered by a pair of Pratt & Whitney engines, good for a 11,700 gross weight and top speed of 178 mph. It seats 13 and prices start around $10 million.

 

Aircraft Financing Glossary

TermDefinition
Accelerated DepreciationThe practice of depreciating an asset more in earlier than in later years. This allows a company to reduce its tax payments, improving cash-flow during the early years of an asset’s use
Aircraft-backed BondsAlso called aircraft asset-backed securities (Aircraft ABS), these securities allow lessors to finance large portfolios of commercial aircraft with attractive debt pricing
Breakage CostsAlso called a prepayment penalty, it is the fee a borrower must pay to the lender for pre-paying a fixed rate loan, though only in cases where the loan agreement had a prepayment penalty clause
Enhanced Equipment Trust CertificatesA financial security used to finance containers used for shipping and offshore businesses, and aircraft purchases
Half LifeA component or piece of equipment of an aircraft reaches its half life when precisely midway between installation and replacement
IncotermsA set of pre-defined commercial terms published by the International Chamber of Commerce (ICC) relating to international commercial law
Institutional InvestorsInvestors such as banks, insurance companies, trusts, pension funds, foundations, and educational, charitable, and religious institutions
Learning CurveThe trend of major manufacturing programs experiencing higher costs in the earlier phases of production than in later years, as production processes improve; in effect, cutting-edge technology is exponentially more expensive to manufacture and/or purchase
LIBORThe “London Interbank Offered Rate” is an index used to determine the cost of various variable-rate loans, including in the US; it can be found in the Wall Street Journal
Pre-Delivery Payment LoanAlso called Aircraft PDP Financing, this refers to the process of purchasing an aircraft from a manufacturer before the product has reached completion
Origination FeeThe fee imposed by lenders to draw up the loan documentation; origination fees are typically 1 basis point, so the fee for a $400,000 loan will be ~$4000
Revolving LoansA type of loan that allows for the principal to be withdrawn, repaid, and redrawn again as many times as the borrower wishes within a certain time frame

Aviation Financing

Aircraft are purchased or leased. Sources of financing include:

  • Leasing Companies
  • Capital Markets
  • Commercial Banks
  • Export Credit Agencies
  • Private Equity/Hedge Funds
  • Tax Equity
  • Insurance Companies
  • Airframe and Engine Manufacturers

Aircraft Leasing

There are two major types of aircraft leasing:

  • Wet leasing:  The lessor (for example, an airline) provides aircraft, crew, maintenance and insurance to the lessee (another airline or other business) that acts as an air travel broker. 
  • Dry leasing:  The lessor is an aircraft financing company that provides an aircraft without the crew and other features of a wet lease.  Lessors are usually banks and leasing companies. Typical term is two years and is often used between a major and a regional airline.

Both capital and operating leases are available. A capital lease usually ends with ownership transfer to the lessee, whereas the airplane reverts to the lessor under an operating lease unless the lessee chooses to renew the lease or purchase the aircraft.

Aircraft Loans

Secured commercial aircraft financing is a common way to arrange aircraft loans. Assets America® can arrange secured aircraft financing using a syndicate of banks and other loan sources. The aircraft serves as collateral on the loan and can be repossessed in case of default. Ownership may be preferred over leasing to take advantage of depreciation. Other types of loans we can arrange include:

  • Revolving Loans
  • Warehouse Loans
  • Bridge Loans
  • Pre-Delivery Payment Loans
  • Aircraft-Backed Bonds/Enhanced Equipment Trust Certificates

 

Aircraft Financing Infographic

 

Online Resources for Bridge Loans

The 2018 Current Aircraft Finance Market Outlook from Boeing forecasts another year of stable growth and funding diversification.

The Global Market Forecast 2018-2037 from Airbus predicts long-term growth as we continue to increasingly take to the skies.

Reuters has also published a well-curated report on the aircraft leasing market from 2018-2023, which estimates the worth of the market to reach $62,221.8 million.

A highly-regarded publication, Business Jet Traveler delivers “authoritative information and advice to help readers maximize their investment in private air transportation.”

For more information, check out this article 20 Tips for Buying an Airplane from Plane & Pilot Magazine.

 

Contact Us

We invite you to contact Assets America® for the best deals in aircraft financing. We leverage a large nationwide network of aviation lenders to provide you rates as low as 170-200 basis points over the 30-day LIBOR for up to 100% of the aircraft’s value. We can also provide operating and capital leases that may be customized to perfectly fit your needs. Call us today at (206) 622-3000!