Flight Training Financing Part61 School

[Flightist]

I'm looking for whats the best deal around for financing pilot training at our flight school. It would seem like Key Bank is the only game in town that offers cheaper rates for pilot training. The flight school I work for talked with them but they only work with 141 schools. Besides Sallie or Nellie May financing is there any other private financing out there comparable to what Key Bank does? What do your flight schools use? I would sure appreciate any leads people have!

 

[Dan CFI/CFII]

Key Bank works with us, we aren't 141. Pilot Finance is the third we can use. Key has best rates, but isn't as easy to get, Pilot Finance has worse rates but is pretty easy to get, and Sallie Mae is in the middle.

Dan

 

[BradG]

Where i work in KC, we use Pilot Finance. Tried key bank, but since we arent 141, no go. The Rates are OUTRAGEOUS. Something like 16.5%. But i guess if you dont have anyother choice...

 

[RockyMnt1]

Financing Pilot Training

I am certainly not going to knock anyone's dream of becoming a pilot, but please exercise some caution about going and borrowing a bunch of money to finance this endeavor.

Let's look at a few things that influences my comment:
1) UAL is laying off a bunch of pilots and will be a 23% smaller company.
2) This is on top of a bunch of pilots that are already on furlough along with other smaller companies.
3) The earning capacity of a CFI is not that great. To try and live and service a large loan is probably not possible.
4) The earning capacity of the 1st or 2nd year FO is not that great either. See #3.
5) When hiring does finally begin, the furloughed pilots will be brought on first, followed by furloughed pilots from other carries (because of their turbine experience), and then the military folks because of their experience. The civilian pilots will be the last to be swept into the hiring wave which is now forecast to be more of a ripple according to current economic models.
6) There is by no means any indication, at this time, that the hiring frenzey that existed in the late nineties will happen during the gradual recovery that is now predicted.

There are other avenues besides borrowing to achieve the pilot goal:

1)Pay as you go. What is the rush to finish right now anyway?
2) Go in to the military.
3) Get flight training thru your company's tuition refund program. I did this for all of my ratings except private.
4) Get a degree in an area that provides the funds needed to fly. There is a guy on here that became a physician BECAUSE he always wanted to fly. His occupation now allows him to do that. That is the way to do it!!

I really don't care what you do and maybe you have someone to support you during the lean years. I am just trying to help you avoid bankruptcy or worse yet, welfare!! My opinion is that to borrow money for flight training is not a wise investment. What happens if you lose your medical (it happens more often than you think!!) or you get violated?? A better investment would be to obtain a non-aviation related 4 year degree that acts as a means to an end. All of your eggs aren't in one basket that way. You must diversify yourself to survive this new world. Just my opinion...

 

[Flightist]

Thanks for the respnses!

Rockymnt, I think you missed the part where I said I worked for the Flight school. This inquiry is to help find financing for my students.

Dan CFI/CFII, do you know if your school had to jump through any special hoops or be persistent or what to get on with Key Bank? We started the process about 6 weeks ago and thought all was going good and then they called back and told our secretary, we can't help you because your not 141. I thought they knew all that. Maybe your school has some other type of acredidation (sp?). The chief instructor here has said that the state of Oregon doesn't accredidate flight schools and says that not having acredidation could be a problem. Any thoughts?

Thanks Jim

 

[Dan CFI/CFII]

For the record Rocky, none of my students are financing this flying stuff, and I paid for it as I went. But there are people who basically had the choice of playing doorman at the Marriot, or taking a loan and learning to fly...

I think our Chief CFI was just real persistent (and jumped through some hoops). I know we've been working on the deal for about a year or so. And while we are part 61, we are a pretty big part 61 operation. Maybe that helps, I don't know. It also wouldn't surprise me if we go 141 sooner or later.

Dan

 

[EMcx2]

I believe the flight school has to be affiliated with some type of college.

 

[asarjfo]

If Key does not work out make sure they go with one of the "Mae sisters". There is a company out there called Collegiate Funding Services that will refinance the loan, but (and this is a BIG BUT) the original loan has to be from an approved federal program. Collegiate will refinance at prime +1% so its a pretty good deal. I made the mistake of taking a "private" loan and have been jumping through hoops to get mine refinanced.

 

[Bataan]

So, you mean collegiate dosen't refinance the sallie-mae private loan? Also could you explain what exactly collegiate does for you? Do they pay off the loan directy to sallie mae, and then you just pay back collegiate at the new rates? Can you borrow above the amount of the original loan? They called me everyday for a year after taking out a salli mae loan. I never talked to them.

Just curious, Thanks

 

[asarjfo]

Collegiate will refinance Sallie-mae private education loans, they will not refinance a private eduaction loan through a local bank.

I don't know if you can borrow more, my guess is no because they pay back the Sallie Mae directly and if they send more than you owe, Sallie Mae sends the difference back.

 

[Flightist]

Thanks Asarjfo,

Do you know if Collegiate does the inital loans for flight training? For Part 61 schools? I'm going to find their website and see what I can find out.

Jim

 

[Bataan]

Thanks for the info asarjfo!

 

[asarjfo]

I think they are strictly refinace, but check it out.....you never know.

Good luck