Real Answers from Real Pilots

Loan Approved!


(cameron) #1

Hi guys,

I’ve recently gotten my PPL and got approved today for my 85k loan request so I’d like to share some numbers with those who are considering getting a loan. Interest rates will vary but i chose the fixed interest rate with 6 month grace at $25 a month while in school. The interest rate was at 9.375% which is a bit scary and he loan will be about double after its all paid off in the suggested 15 years and $1,000 per month payments. I’m wanting to make the jump to the Oakland or Phoenix location, not sure which is better if at all. I do involuntarily hesitate since my other flight school is so so cheap at $4500 for my PPL. Did anybody have payments this high and if so did they have any trouble paying off the loan?

Feel free to shoot this down, but another hesitation is thinking i could build hours with another instrument student at the same level going on cross country flights, flying half and the other safety pilot to build hours and save costs, what do you think about this? any responses are appreciated thanks.


(Cameron Clark) #2

If you don’t mind me asking, where did you get your loan from? Did you have a co-signer? How is your credit score?

9% is for sure a scary number, so I want to try to get that as low as possible.


(cameron) #3

I went through Sally Mae and yes my father was my cosigner. i had a score in the high 600’s/ low 700’s and my dad was a bit lower. And yes it is indeed.I didn’t try for Wells Fargo because he only wanted to cosign and Sally seemed a safer option.


(Cameron Clark) #4

Also, when you say six months grace I assume that means deferred payments for six months, right? Not interest free… i wish. I assume you also have an option for extra payments to pay it off early.


(cameron) #5

There is an option for no payments for 6 months but I didn’t choose it. I would pay 25 a month until after the grace period ends. I just got off the phone with them and during your grace period, if i apy more than 25 say i have an extra 1000 and pay that, the grace period actually ends sadly and the payments start so that’s disappointing.


#6

Cameron,

You might potentially be able to save a few dollars by partnering with somebody else. Maybe, but probably not. The reality is that you will have to go to some mom and pop school to accomplish this. They won’t have many students and likely none that will be at the same place in their training that you will be or that will want to partner. These delays could cost you months or even years, thus delaying your training, which will add to the cost and decrease your earnings potential.

Chris


(cameron) #7

Thanks for the response Chris, that makes sense and is probably right.


(Tory) #8

Cameron,

That’s a high rate, but at least you were approved! Look into refinancing? That’s something I wish I did.

Tory


(cameron) #9

How do I refinance it, should I do it before it starts?


(Tory) #10

Don’t know. Never tried. Kirk in Finance in ATP admin would know. You can give him a call during normal business hours. Obviously refinancing after the program won’t be an issue. See what Kirk says tomorrow.

Tory


(Sergey Kireyev) #11

Congrats, man! Get that date locked in and start studying!


(cameron) #12

how is your instrument going?


(Sergey Kireyev) #13

Coming right along. Stand by for update next week.


(Donald Kozak) #14

Cameron,
Good luck on your training. If you’ve done your homework on borrowing for school, technical or academic, you know its only a good deal if you follow through and get on repaying asap, presumably by way of the increased earning you command due to your recent education. There are a lot of horror stories of people who fail to complete, get ripped off or some combination. I assume 85K is a lot for both you and your dad, something that is not going to be easily repaid without you earning (and or course paying) quickly and, ideally, in an expedited manner.

Regarding who to use and how to pay down the costs. The only reason to take out such a big loan is to do a quick course and get on with getting flying work and paying down the debt. The lender is not going to care how or why you can’t pay the terms you agreed to, just that you do. The flight School ,you got your PPL does sound very reasonable vs the current expectation for what you would spend on flight training. You will get a lot of advise not to go in debt and take a go slow, pay as you go, approach to your flight trining. Thats a decision only you can really make and its based on several factors; to name a few, your age, how well you you study and learn, whether you can handle an expedited training regimen, the quality of the flight schools you would consider (for either the fast or slow paced training method), and lastly, your ability to pay as you go and how doing both at the same time (flight training and working ) will impact the speed and quality of your training experience.

Good luck, risks and rewards either way you go.


(Chris) #15

Cam,

That loan can be difficult to pay off. I have a buddy with a similar loan amount and rate that had to stop flying because he ran out of money and flying didnt pay the loan + other bills.

Expect to make $1200/m when you start instructing and 1500-2200/m after month 3 of instructing. That does not leave much money for other bills, let alone investments and descretionary funds.

That being said it can be doable.

My advice is to lower all your bills NOW and pay as much as you can while training. I sold my new $50,000 truck and got a beater car to start flying. I didn’t go out to eat or party much either.

Step 2 is you can refinance the loan. LendKey and a few others will probably give you a better rate. I refinanced 3months after finishing the program and got a 2% better rate.

Good luck & have fun,
Chris


#16

Keep this in mind, it can be a huge help:

https://atpflightschool.com/faqs/tuition-reimbursement.html


(matthew scott) #17

Cam where did you get your PPL so cheap? I’m also thinking of doing the same thing as you to build hours and save costs.


(cameron) #18

Matt,
I got it at an airport called oakdale in California. It’s not a flight school but rather a club. Two owners started letting others use their planes to learn in so they didnt need to rent planes and help people get into aviation, it got bigger and bigger so to continue legally they had to up their insurance and make it into a club. They then added two more planes and got a hanger so theres a yearly fee and the 152 is $70 an hour and 172 $90. The instructors arnt tied to the club but mostly teach there and my I structure is currently a career instructor with 9k hours of instruction. I also volunteer on ridealongs at work such as in a barron when he can sign off as dual revived as an instructor. It will cost around 15k to get 250 hours and I have 12k so it could be a straight shot if I hustled. I desire atp so badly with its reputation but I hesitate what I’m leaving


#19

Cameron,

That sounds like a great deal. How long did it take to get your PPL?

Adam


(cameron) #20

I trained about 2-3 times a week and it took me just about 5 months and I took my check ride at 47 hours