“This land is your land, this land is my land
Buying a private jet can be an intimidating prospect. But, it doesn’t have to be. With the right professionals on your side, you can walk through the acquisition process with confidence.
Let’s take a look at the steps you’ll need to take to purchase an aircraft for business or personal use.
Select Your Acquisition Team
Whether you are looking to buy your first aircraft or trade-in an existing jet, a reputable broker can help you make an informed decision. A knowledgeable broker can help you find an aircraft that best meets your needs, look for potential maintenance issues and sell your existing aircraft for the best price. A broker will ensure that negotiations go smoothly and all of the appropriate documentation is complete. It is worth the time and effort to find the right fit.
Start by asking friends and colleagues who they have worked with and who they recommend. Experienced brokers have a wide network that can broaden their acquisition search.
You can also look for brokers with industry accreditations. Dealers that have earned International Aircraft Dealers Association (IADA) membership are part of an elite group. They adhere to a higher standard of service as well as a Code of Ethics. IADA-accredited dealers are responsible for 40 percent of pre-owned aircraft sales. Since there are no federal regulations governing aircraft brokers, accreditations are one way you can determine if your broker is qualified.
Even if you have legal counsel, it’s a good idea to consider engaging an aviation attorney. Legal counsel with this area of expertise can review transaction structure and assess tax implications.
It’s also a good time to start interviewing aircraft management companies.
Assess Your Needs
At Omni Aircraft Sales, we begin the acquisition process with a needs assessment. As part of this step, we confirm your target budget, operating cost, and annual fixed cost. We also assess your performance specifications. We look at your expected travel range, passenger loads and schedule. It’s important to accurately assess how you will use the aircraft so your broker can find the perfect match.
Search for the Right Aircraft
Next, your broker will identify potential acquisition targets with the information gathered from your needs assessment. They will also take your personal preferences into account. At this step in the process, a broker’s network is especially important. A broker can use industry contacts, online searches and off-market resources to track down the right plane.
Make an Offer
Once you’ve identified your target aircraft, you and your broker will determine optimum acquisition pricing. Formal offers are typically submitted with a Letter of Intent and a soft escrow deposit.
Negotiate Your Aircraft Purchase Agreement
Your broker will facilitate negotiations for the Aircraft Purchase agreement. If you plan to finance your aircraft, you can negotiate the finance term sheet with your lender. Your broker and/or legal representation will also conduct due diligence on the title.
With the Aircraft Purchase Agreement signed, it’s time for the pre-buy inspection. Savvy buyers go beyond the manufacturer-required inspections and look to reduce going-in maintenance costs. The buyer’s technical team reviews the logbook and checks back-to-birth records. At Omni Aircraft Sales, our pre-buy inspection means all major repair items are covered at the seller’s expense. We also coordinate inspection schedules, scope and cost with the appropriate maintenance facility.
Aircraft Acceptance & Pre-Closing
Before you can proceed with closing, your broker will confirm the aircraft is in an acceptable condition to proceed to closing and ensure inspection satisfies any and all discrepancies. With the Aircraft Acceptance complete, it’s time to prepare all of the documentation for closing.
Your broker will coordinate the required FAA filings as well as the documentation associated with the aircraft purchase and transfer of ownership. The closing budget is circulated and you’ll deposit funds in escrow toward closing. An insurance binder must also be confirmed.
With the final FAA filings in place and the distribution of escrow funds, you and your broker can coordinate aircraft pick-up or delivery. Behind the scenes, your broker will manage all of the engine and avionics program transfers.
If you plan to make any paint or interior modifications, an Omni Aircraft Sales broker can coordinate with industry-leading professionals to make any changes. Additionally, your broker will transfer any ownership/operations support services at your request.
Now, it’s time to plan a trip!
If you’d like to learn more about the long-term benefits of aircraft ownership check out our Guide to Buying or Selling a Business Jet.
Ready to get started? Call our dedicated team at Omni Aircraft Sales at (918) 836-4050.