ASA Frequently Asked Questions About Buying and Selling Jet and Turboprop Aircraft
Questions About Brokers
Q: Do I have to have a broker to buy or sell my plane?
A: The short answer is no, you do not have to have a broker
to buy or sell a plane. But the more important question is, should you? And
that depends heavily on your own experience and comfort level with buying or
selling aircraft. It may surprise you to learn that we sometimes recommend
people don’t use a broker, even us. If you have the experience and skills to
handle it yourself, then it may be a wise decision. it’s important not to make
this decision be about money, because very often an experienced broker can
actually save you money, even when you factor in his or her fees. Or at the
very least, a good broker will help you make sure you don’t end up spending
more than you intended from unknown or unaddressed items. Be up front with your
potential broker and talk to him or her about the fee. He or she should not be
reluctant to disclose everything about their fee to you. If they are reluctant,
that’s a good sign you should keep looking for another broker.
Q: Can ASA help me buy or sell my plane?
A: Absolutely. ASA is here to help you fulfill your dream of
flying but our day job is buying and selling aircraft. If you’re thinking about
buying or selling a plane, feel free to contact us. We have a lot of useful
information we can provide and we won’t make you sign a contract just to talk
to us. After we talk and provide you with some useful tools and information,
then you can decide if you’d like us to represent you. If not, no hard feelings
and you’re still welcome to the advice and information.
Q: What licensing or registration do brokers have to go
through?
A: So we might as well introduce the concept of brokers vs
dealers to you here. Brokers do not have any type of registration or licensing
with any government agency, with the possible exception of a business license
or such at the local level. Dealers, on the other hand, are registered with the
FAA and are given the ability to fly aircraft on their Dealer’s registration
certification, allowing them to avoid sales tax on aircraft in inventory.
Neither is better or worse and are often two sides of the same coin. But since
no licensing, bonding or certification is required for either type, it’s
critically important that you find a broker (or dealer) that you can trust.
Q: Do brokers have to be pilots in order to sell planes?
A: They do not. But we’ve often thought that they should be.
Honestly, we got into aviation because we love flying, we love planes. We would
argue that someone who is a broker without a pilot’s license is really only in
it for the money. At ASA, we all have pilot’s licenses because we all love to
fly. Brokering aircraft just allows us to make a living on something we love to
do.
General Questions
Q: Does ASA only work with jets and turboprops or will you
help me with my piston-engine plane?
A: ASA will absolutely help you with your piston. We
specialize in jets and turboprops but the information we provide for those
types of aircraft is very relevant to piston aircraft. Our videos and advice
all apply and we’ll even be happy to broker a plane for you. We care deeply
about helping people fulfill their dream of flying, so if you need assistance,
just reach out. That’s what we’re here for.
Q: How old is too old when it comes to Total Time?
A: Short answer, never! There are some amazing old planes
out there with some incredibly high total times. As long as they have passed
annual and are well cared for, total time doesn’t affect how much fun they are
to fly. However, from a buying and selling perspective, you should keep in mind
that higher time airframes tend to bring much less money. Buyers are worried
about fatigue on the aircraft, cycle times, etc, and lots of times it’s just
easier to buy a plane with less TT. A good rule of thumb is to think of
aircraft total time the same way you do mileage on a car. If a car has over
100,000 miles on it, there may not be anything wrong with it. But chances are
it’s not in as great a shape as one with only 20,000 miles on it. Same with
planes, but the magic number for aircraft is 10,000 hours. This roughly equates
to 100,000 miles on a car. Planes with over 10,000 hours on them are considered
high-time airframes. A high time airframe can still be the right aircraft for
you, but you need to carefully weigh that plane’s TT against what you plan to
do with it.
Q: How big of a deal is damage history?
A: Well, it depends on the circumstances. Generally
speaking, any damage history at all is going to lower the resale value of the
aircraft. If you have two planes that are equals in every way, but one of them
has damage history, the one with the damage history will be worth less than the
one without, sometimes substantially less. So if you are buying an aircraft
with the intention of selling it later and getting your money back out of it,
damage history can be a huge deal and something you want to avoid at all costs.
On the other hand, if you are purchasing a plane for your own enjoyment, an
aircraft with properly repaired and documented damage history may be a way of
getting into a bigger or better aircraft than you would typically be able to
afford. Just recognize that damage history never goes away, and if you buy a
plane at a discounted rate because of damage history, expect to sell it at a
discounted rate as well. If you’re considering a plane with damage history,
give us a call. We’d be happy to give you our insight on some things you might
want to consider.
Charter/135 Questions
Q: I keep hearing about 135, what is that?
A: Part 135 of the Federal Aviation Regulations governs the
operation of Air Charter Certificates. When an owner of a Jet or Turboprop
talks about Part 135, or putting his or her plane on a 135 Certificate, they
are talking about placing the aircraft on a 135 Charter Certificate in order to
make money on the plane. Typically, you would place your aircraft and pilots on
the 135 Certificate and pay the Certificate owner a monthly management fee and
they in turn will find charters for your aircraft and pay you a certain amount
of money per flight hour. Charter can be incredibly complicated, but it
definitely has its benefits. If this is something you are interested in, give
us a call and we’ll get all your questions answered.
Q: Can I really fly
my plane for “free” by putting it to work on a Part 135 Charter Certificate?
A: The answer is, maybe. You absolutely can earn money
putting the right plane on a 135 Certificate. The question of whether or not
you can make enough to fly it for free has a lot to do with the aircraft’s cost
of operation as well as its overall expenses. There is a “sweet spot” where you
can actually fly for free. Here’s how it works. Let’s say that you buy a snazzy
jet that charters out for $2500 an hour. Let’s say that it costs, for easy math,
$2000 an hour to fly it. Well, if you charter the plane for 4 hours, you’ve
made enough to cover 1 hour of “free” flight time for yourself, right? Sort of.
You’ve covered the aircraft’s operating cost, but you haven’t necessarily
covered it’s fixed costs, which include everything from pilot salaries to
insurance to the monthly payment for the plane. However, if you have an
aircraft that is new enough to be very efficient, but inexpensive enough to not
have huge holding costs, but desirable enough to keep it popular on the charter
certificate, then yes. You can make enough money to cover all of the aircraft’s
expenses and “bank” 5 or 10 hours a month for you to use for free. There are
only a handful of aircraft that fit in this sweet spot though, so work
carefully with your broker and your Part 135 operator to ensure you get a plane
that will do what you want.
Q: If I want to put my plane on a 135 Certificate, do I have
to use the 135 Operator as my broker?
A: You do not. And, in fact, we would argue that you don’t
want to. A good broker is going to help you get the very best plane for you and
your needs. A 135 Operator may be tempted to help you get a plane that is the
very best for his or her Charter needs, and not necessarily the best for you.
Most 135 Operators are very happy to add new aircraft to their certificate,
even if they didn’t help you buy the plane. They still make their money off the
charter and their management fee. So, unless you are very comfortable with the
135 Operator, it’s probably best to keep the Purchase and the Charter as two
separate, distinct deals, and get the very best deal for you in both instances.
Don’t see your question addressed here? No worries! Email us
and we’ll answer it straight away. We’ll be continually expanding this FAQ
based on your feedback so send it our way!
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