Customised solutions and services
Operating Lease
Operating Leases provide clients with a convenient tax effective off balance sheet solution. At the end of the lease period, you can look to extend the term, buy the aircraft or simply hand it back.
Finance Leases
Unlike an operating lease, a finance lease is a debt obligation with title changing at the end of the term subject to the payment of any outstanding balloon amount. All on-going maintenance costs are at the expense of the lessee.
Debt Loan Structures
A purchase with mortgage funding over a set term (normally 3, 5 or 7 years) with an agreed residual bullet payment. The loan can be in USD or AUD, fixed or floating and can also be structured with servicing costs and repayments in AUD but the underlying facility being USD based.
FAQs
What is the minimum and maximum amount I can borrow?
The minimum loan amount is usually around AUD $400,000 with facilities normally capping out around USD $70,000,000.
How is the aircraft valued?
A valuer will be appointed by your funder just as they are when you buy property and seek finance. Most aircraft are valued in USD.
Can I borrow in AUD or USD?
Depending on the size of your facility and the value of your aircraft, facilities are normally funded in USD. If your income is predominantly AUD, then you can look at swapping out your payments into AUD.
If I borrow in USD, can I repay in AUD?
Yes you can or if you borrow in USD, you can look a swapping out some or all of the repayments into AUD.
Do you have anyone I can speak to to help me decide on the best aircraft for my needs?
We will work closely with any of your existing advisors. We also have a relationship with Jet Assist who specialise in helping clients buy the most appropriate corporate jet for your needs, negotiating the purchase price and they also provide full on-going management services.
Can I fix my interest rate?
Yes, most borrowers can elect to fix their interest rate cost via either a fixed rate loan or an interest rate swap.
Am I able to repay early or break my lease before expiry?
Yes you usually can, there will be costs associated with breaking your facility early
Which is better, a lease or outright purchase?
For a first time buyer, an operating lease whilst more expensive does give you the ability to hand the asset back at the end of the lease period without the stress of looking for a buyer. We are happy to speak with you to find out which solution is better for you.
Do I need to use a lawyer?
Yes, you will need to employ a lawyer to help you execute this type of transaction. We would be pleased to introduce you to a lawyer who is highly experienced in aviation law.
How do you charge your fees?
Aviation Finance Partners will charge an upfront work fee depending on the scope of work mandated. We may also receive commissions from your funder should you use any finance arranged by us. Any fees paid to us will be disclosed to you.
What are my obligations to the lender?
You need to make sure that your aircraft is maintained (including implementing any airworthiness directives) , insured and operated in accordance with local and international aviation law. If the aircraft is leased, then there will also be a requirement to keep it in a hanger.