Aircraft Finance Security ?

[Adrian Lewer]

Hi All I have a question for you all. If I buy a second hand A/C how can I tell If someone has finance on it and wether or not it has been used as security for the loan ?

 

 

[Guest brentc]

Great question Adrian and I await a correct answer!

 

In the mean time this will go part way towards answering your question - the registration certificate provided by RA-Aus is NOT a certificate of title.

 

 

[Guest Orion]

Short answer is you can't.

 

With motor vehicles there is the REVS system however i don't think aero industry has same.

 

Maybe something RAA should champion.

 

Couple of tips.

 

If you are buying from a company then there may be a registered charge over company assets in which case a company search of ASIC - Australian Security & Investment Commission which is the corporate regulator - would show up the charge you would then need to enquire of the company.

 

If its an individual or non company you can't do that as no such registers exist.

 

two alternatives spring to mind.

 

1 ask to see copy of insurance policy. If aircraft insured when under finance it should be noted on the policy, most financiers requre this as part of the terms of finance.

 

2 you could do a credit check throgh one of the credit agencies, if you can get access. this lists finance applications and other credit history details and you may pick it up from this report.

 

other than that its a risk,

 

you could ask them to sign a document gaurenteeing it has clear title but if the repo man comes knocking it won't save the plane it will only set up the other party to allow you to sue them. which may not help much. if thy have dissapeared

 

Cheers

 

Kent

 

 

[quentas]

Buy a new Jabiru ;)

 

 

[BruceScott]

 

Love it

 

 

[Adrian Lewer]

New Jabiru ? It is the one on the top of the list at the moment but am unsure if I have what it takes to build one ?

 

If we build or buy one Kirsty will be the owner and I will be the one who it is registered to Like Brent said.

 

I like the Insurance Option though great thought.

 

 

[Guest ozzie]

would a finance company take the aircraft as security even if it was insured?.

 

 

[Guest Orion]

Thats the point of the question.

 

how do you tell if the aircraft you re buying is encumbered ?

 

Obviously to be encumbered means someone has taken it as security for something ie a loan.

 

In that case most finance companies will require insurance and their interest noted on the policy.

 

If the finance company hasn't taken it as security then they don't have a right to take posession of it in a loan default situation.

 

Kent

 

 

[Guest brentc]

Build one Adrian. I did it and I had no mechanical skills until I had finished! If you can use a drill and a sander and have a straight eye you're half way there.

 

How would one tell if a finance company has an interest in an aircraft? In the GA world, one must register their details with CASA, but I'm still unsure in the RA world.