Pilot – June 2018

Advertising Feature

pilotweb.aero | Pilot June 2018 | 75

PHOTO: COURTESY OF THE LAA

PHOTO: COURTESY OF THE LAA

Financing the deal

How about a new, factory built aircraft?

UK-based merchant bank, Close Brothers,

has been financing the general and business

aviation industry in Britain for over four decades

after first opening their doors in 1976 as Air

and General Finance Limited. Andy Blundell,

Director of Close Brothers Aviation and Marine

told Pilot that “we can finance a wide range

of aircraft, including light piston aircraft,

turboprops, helicopters, executive corporate jets

and air ambulances. We also finance vintage

aircraft and are a strong supporter of historic

aviation in the UK.”

Close Brothers Aviation and Marine will

finance brand new aircraft direct from the

manufacturer, or pre-owned aircraft that are

being sold from dealers, brokers or via private

sale. Andy explains the process. “The finance

facilities are structured by way of a loan with

security by way of a mortgage over the aircraft.

The mortgage will be registered at the CAA

or another national aviation authority, and

arranging the financing for the purchase of

private aircraft is usually a straightforward

process. Typically, it will proceed like this;

1 The borrower provides information about

themselves and their prospective aircraft to

the lender.

2 The lender performs an appraisal of the

aircraft’s value and undertakes its own internal

credit analysis. The lender would normally

expect the borrower to undertake their own

pre-purchase survey of the aircraft.

3 The lender and borrower agree terms on the

structure of the transaction.

4 The lender performs a title search based on

the aircraft’s registration number, in order to

confirm that no liens or title defects are present.

The lender then prepares the documentation for

the transaction, which includes dealing with the

vendor, insurers, maintenance organisations and

(where applicable) lawyers.

5 At closing, the loan documentation is executed

and then funds are transferred.

Andy goes on to say that, “The sheer variety
of aircraft available is another factor to consider
and a reason why it’s important that each
opportunity is assessed individually. We have
helped customers purchase thousands of
aircraft, ranging from small flying club aircraft to
mid-sized corporate jets, historic warbird aircraft,
two-seat private helicopters to large corporate
and air ambulance helicopters.”
Facilities are usually structured over five to
seven years, with final ‘balloon’ payments usually
an option, depending on customer requirements
and the specific aircraft being financed.
Finally Andy adds that “All aircraft must be
comprehensively insured, with the lender’s interest
in the aircraft noted on the policy.”
http://www.closeassetfinance.co.uk/close-brothers-
Aircraft new and old: CZAW SportCruiser and (foreground) 1960s Jodel D150 aviation-and-marine

Buying an aircraft of your own opens up a world of choice as to how and where you fly