Adam Answers

Adam Meredith, president of AOPA Aviation Finance, is an aircraft finance professional with more than 15 years lending, small business management and customer service experience. Adam is a commercial pilot with multi-engine and instrument ratings.

CHRIS: What’s the longest term for a Cessna 170B?  

ADAM: The longest term for a Cessna 170B would be 15 years, however this assumes no damage history and complete logs for the aircraft, as well as good credit for the borrower. 

DAVE: How much can be borrowed on an aircraft? Is there a percentage limit?

ADAM: Typically the maximum you can borrow is 85% of the aircraft value, however there are some limited exceptions where 90% is considered for exceptional credit.

Although our lenders can sometimes get to 90% on a limited basis, generally this only makes sense when the borrower is planning to pay down the loan faster than a standard term of 15-20 years.

ROGER: What is the impact of bankruptcy when applying for a loan?  

ADAM: Bankruptcy is generally a problem with most lenders. There are instances where a lender can get passed a bankruptcy, however, but they will want to ask the following questions:

• What caused the bankruptcy?
• What type of bankruptcy? Chapter 11/13 vs Chapter 7?
• What has your credit history been and how long has it been since the bankruptcy was finalized?

The lender will need to see evidence of good credit history since the bankruptcy and feel comfortable that it was a one-time event. If they are able to provide an approval you should expect a higher interest rate, more money down, as well as a shorter loan term. 

Have questions for Adam? He is happy to answer them. Submit your questions here.