A1Skinner, you have a PM.

Steve

A1Skinner wrote:..... I had a lot of people tell me not to import because it can be a nightmare and very costly. My plane was stock except for VG`s, and it was super easy. I couldn't believe how easy it was actually, especially after everything I had heard......

I think selling an aircraft across the border is kinda like travelling across the border: US > Canada easy, Canada > US not so much.

hotrod150 wrote:

A1Skinner wrote:..... I had a lot of people tell me not to import because it can be a nightmare and very costly. My plane was stock except for VG`s, and it was super easy. I couldn't believe how easy it was actually, especially after everything I had heard......

I think selling an aircraft across the border is kinda like travelling across the border: US > Canada easy, Canada > US not so much.

As a Canadian citizen, I have never had a problem going into the US. The biggest inconvenience I've had is driving through the X-ray and stopping at the vets office while hauling buffalo down, but that was expected. However, when coming back into Canada from the US on my road trips for NASCAR races, I've been stopped for over 2 hrs twice while they searched our vehicle. .

Sent from my Galaxy Nexus using Tapatalk

I am looking at bringing in an Experimental from Canada.
With this letter I can Fly it into the USA?

Special Flight Authorization for Canadian Amateur-Built Aircraft Operating in the United States

This from a DAR

You will need to have the permanent aircraft registration "N" number before you can apply for a airworthiness certificate. I will be able to do the amateur built certification for you.

And This

I looked the information up both on the FAA website and Transport Canada website. It looks like the aircraft had an amateur build certificate before it was exported to Canada. I don't see any major problems at this time. I charge $300.00 plus expenses and millage at the government rate $0.51/mile for the basic amateur built certification. If there is problems and additional work is required I charge $100.00/hr plus expenses. You will need to have the aircraft deregistered in Canada and a permeate US registration.

And this

To register an imported aircraft, you must provide the following:
a statement by the official having jurisdiction over the National Aircraft Registry of the foreign country of export indicating that registration has ended or that the aircraft was never registered
evidence of ownership, such as a Bill of Sale, signed in ink, from the foreign seller to the U. S. applicant/owner
a completed Aircraft Registration Application, AC Form 8050-1
a check or money order made payable to the Federal Aviation Administration in the amount of $5 (U.S. funds)
We handle imports on a priority basis. Please write "Import" in red ink on the envelope and the request.
You must use an original Aircraft Registration Application, AC Form 8050-1. We don't accept photocopies or computer-generated copies of this form. You can obtain Aircraft Registration Applications from the Aircraft Registration Branch or your local FAA Flight Standards District Office (FSDO).
If you use a P.O. Box as a mailing address, you must also include your street address or physical location on the application. If necessary, provide directions or a map for locating your residence or place of business.
Your application for aircraft registration must include the typed or printed name and signature of each applicant. We will return any applications that do not include the printed or typed name of the signer.
For more information, review Information to Aid in the Registration of Imported Aircraft, AC Form 8050-124I (PDF, 13 KB) or contact the Aircraft Registration Branch.

I am also working with the Canadian owner as we are trading experimentals so am finding out a lot about that!
GT

At risk of pissing a bunch of people off and never getting another reply to a post I will say this. Dave Ramsey is a good man with a good philosophy but it is an overly simplified one. DEBT is not a four letter word in the way he says it is. Debt, just like a gun, is a tool. It can be used for good or bad but how it is used is determined by the person holding it.

Dave Ramseys philosophy is one of paying for everything cash and avoiding all risk. Simple and safe but means you get to work your whole life for little reward.

I follow the Robert Kiyosaki philosophy. An asset puts money in your pocket. A liability takes money out of your pocket. Buy and build assets like properties and businesses. Let other people like customers, banks, and tenants help you build those assets so they make money even when you aren't at work. Use the money they generate to buy you stuff like airplanes.
The concept of delayed gratification is still there. Forgo the new car, but rather than saving at .015% return, put your money in a rental property or business instead. Let that grow, and do it again and again for years. Then, use the money that those assets has produced to buy your liability (airplane).

Broke is temporary but poor is a mindset. Never say "I can't afford that". Instead, ask yourself "How can I afford that?"
http://www.amazon.com/Rich-Dad-Poor-Teach-Middle/dp/1612680011/ref=sr_1_1?ie=UTF8&qid=1346804214&sr=8-1&keywords=rich+dad+poor+dad

Well said.

Tick wrote:......... Dave Ramsey is a good man with a good philosophy but it is an overly simplified one.......

I agree. I've listened to his radio show a few times, and the essence of what he tells every caller is to get/stay out of debt & save your money. Pretty simple, that's been my philosophy for most of my life. I'm not wealthy but I have the stuff I want & it's all paid for. I don't undertand why it takes a daily hour-long radio show to say that, but he's no doubt making a good living out of it.
I also agree with Tick that debt is a tool. IMHO it's probably foolish to go into debt for a toy, but damn near impossible to avoid for something like your home or a growing business. I know a guy who owns a couple self-storage places, he's carrying a helluva debt service on them but essentially they are paying for themselves. He told me it was scary signing into that much debt but it was the best financial move he's ever made.

Grassstrippilot wrote:Good topic and interesting. I am not currently an out-right owner, but soon hope to be.

In college I bought into a 1/6th ownership in an Apache with the Geronimo conversion for $6,000. Took a loan from Grandma that I paid back that summer with some of my wildland firefighting earnings. At the end of college and shortly after getting married, I sold my share for the same amount. Also during college, I joined a flying club that is set up as a part ownership in the aircraft. When we moved back to UT, I got back in the club and these are the aircraft that I currently fly. I have yet to come across a better deal from a cost perspective and that is after talking to pilots from all over the country.

So now with the family growing, we need a bigger plane. We are debt free with the exception of our mortgage. I have been blessed with a wife that attacks debt like a pitbull. She graduated from college debt free and $10K in the bank. Then here I came along with $60K+ in student loans. But, by being frugal, she had my debt paid off 7 years early. Up until 4 years ago, we both drove our college cars. It wasn't until the birth of our first child that we decided that she needed a more reliable car. The first few car upgrades were partially financed, but again, she attacked it and paid it off quickly. The last car upgrade (needed more seat with the third child) was paid for in cash. A nice feeling.

So, on our way home from Thanksgiving, the subject of owning an aircraft came up again. Luckily she is on board with the idea "when we can swing it" and she told me to start crunching the numbers. The game plan will be like we have approached everything else: pay for as much as we can up front, finance the rest, and pay it off as quickly as possible. I did get from the conversation that, because the way she attacks debt, she had in her mind to pay off the house before thinking of a plane. I told her that I wanted one while the kids still lived with us and before I retire, so that probably wasn't going to happen!

So now we just have to figure out when it is ok to pull the trigger. I have a feeling that the answer to this is similar to having kids: if you wait until you think you are ready, you'll never have any kids! As much as I'd rather pay cash for one, I think that financing will have to be done to make it happen sooner than later. The thing that scares me to death is buying one and then having a major mechanical issue come up. As the treasurer for the flying club, I see monthly the amount of money that we shell out on maintenance, of course that is a club setting with the planes being flown a lot by a lot of different pilots.

And then we just hope and pray that work keeps going well and the income continues to increase. Other than that, stay debt free and keep our cost of living below what we earn...of course that probably goes out the window with an airplane! The good news is that we want a 205 and hopefully will be able to pick up a good one for a reasonable price that can be paid off in a couple of years.

UPDATE:

Well, a little over a year later and now I can speak from the standpoint of what we have done and not what we hope to do. Since I don't recall this option being mentioned, I thought I would post it.

Over the last year we started saving for a plane, but the thing that really made it doable now instead of 1.5 -2 years down the road was a suggestion from my brother the banker. When we were looking at refinancing our home, he mentioned a cash out refi. I asked what that was and when he told me, I flew it past Dee. After chewing it over for a few weeks, we decided to do it. It essentially allowed us to get into an aircraft for a much lower rate on the loan and allowed us to do it a couple of years earlier. We ended up financing 2/3 the price of the plane, with the other third paid in cash. Doing this made what would have been an $800/month aircraft payment into about $270/month...and the interest on the loan, since it is in our mortgage, is tax deductible.

For us, this worked out to be a pretty good way to do it and got us into a plane sooner than later.

A pilot friend of mine who is quite a go-getter (but in his own way) bought a city lot & built a house for himself at about age 25. A couple times since then, when he needed money to buy an airplane and later a hangar, he re-fi'd the house and took some of the equity out to do so-- just like you're describing. It really helped that property values were growing by leaps & bounds around here back then-- he was gaining equity every month even if his mortgage payment didn't pay much on the principal. Good low rate & deductible interest, way to go! Just don't get yourself upside-down by taking out too much equity. Another friend did something similar back in the 1980's, and when he got behind on his payments & had to sell the house he wondered why he "didn't make any money on the house". He didn';t realize that he'd took out his profit on the nstallment plan over the years-- but at least he was able to walk away debt-free.

Yeah, luckily our mortgage payment remained the same and the extra amount taken out wasn't an obscene amount of money.

hotrod150 wrote:<snip>when he needed money to buy an airplane and later a hangar, he re-fi'd the house and took some of the equity out to do so.

That's my plan in a few months. One of my places is free and clear. The only people who get hurt on this deal are my heirs. Screw 'em anyway......

EB

I've been slowly putting together rental properties so I can eventually use a refi and the cashflow to pay for my plane. Hopefully, my assets can buy me a sweet liability someday! My tenants are essentially buying my airplane for me. That, my full-time job, and my business.

(But of course, bring up financing on here and you'll get mobbed by people telling you you're chasing instant gratification. Then you'll get told stories about their kids who didn't take their advice either. Oh, and something about snow and twelve miles both ways.)

I really like the idea of using property (a tangible asset) to buy an airplane. I'm a little iffy on using a primary residence but I think we've seen the bottom of property values at this point. I feel bad for anyone that tried doing this a few years ago when values were sky-rocketing, though.

TomKatz wrote:It does seem funny! Once you own a plane, you don't care what you drive.

That is the truth. I sold a really nice Jeep that I had built and ended up paying cash for a nice older S10 pickup and used the money I was making payments with to finance the airplane. Most pilots I know and see around the airport drive older vehicles, and while some of them are still pretty nice, I would be that almost, if not all are paid for. My plane is nothing special and at $35,000 was less than most Airmen that work for me spend on their cars and trucks these days. And I am having way more fun and seeing more of Alaska than they will ever dream of. I dont have any credit card debt and everything I have I own with the exception of our house and my wifes vehicle, so the price of the plane and insurance is not that bad. When we pay my wifes vehicle off in another year and a half we are going to roll that over into the plane payment as well and pay it off in a few years! I tried going to home refi route initially, but we just didnt have quite the equity in it we needed. It is tough being in the military and moving so often. I am at the end of my career now though and ready to start a new chapter!

Wow, this is a great thread. I really like all of the detailed stories you guys have provided, since it demonstrates that there are so many different ways to get from point A to point B, regardless of income. Personally, I'm not an aircraft owner just yet. I'm hoping to become one in about a year or so, and have just started doing some research on this subject. Debt also scares me more than it scares most folks.

Here's the story of how I've gotten myself to a point where I might actually take the plunge into aircraft ownership. For those who hate reading, the short version is that I'm a middle-income guy with a middle-income girlfriend, and we live very modestly:

I started flying back in 2001, while still in college. During that time I picked up a Private Pilot Certificate and an Instrument Rating, originally intending to continue on a professional pilot track. The 9/11 attacks made me rethink this career path after many of my employed flying friends were laid off in the tough economic years after these attacks (lots of debt and unstable low income flying jobs seemed like a problematic combination). Since I had double majored in business and aviation, I decided to not go further into debt for a flying career that didn't seem to be readily available at that time.

I ended up finishing college debt-free, and took my first "career" job in management during the post-9/11 recession. This job paid me very little while I worked me quite a bit, so I gave up flying for a while. I got married during that time to a nice girl who proved to be virtually useless in the adult world, and we later divorced on relatively good terms with each other; she still isn't employed years later, and is apparently still living off of the money I gave her in the divorce. The cost of supporting two people during those lean years did teach me a lot about cutting corners for the sake of savings, which I think helped lead me to where I'm at now.

Fast forward a few years and I feel like I'm getting close to being able to afford an airplane (by my personal definition of affordability). My girlfriend (future wife) and I have worked hard at saving money and controlling our spending. We both got burned financially by divorces, so we're working that much harder to make sure we get the finances where we want them to be. The only debt we have between us at the moment is the remaining balance of the mortgage on my house, and I plan to have this paid off by the end of the year. At that point we'll both be 100% debt free, which should quickly open up some cash to start enjoying life to the fullest while we're both still young enough (I'm 33, she's 28).

The finances certainly didn't come together by accident for us, and I've been on the path of aggressive savings since before we even met each other. I settled into a career as a police officer about 8 years ago, and my girlfriend makes a decent living that pays her slightly less than I make. We are educated folks of modest but not entirely meager means, living squarely in middle-class America. To get where we are we certainly made a few sacrifices: we rarely go out to eat at sit down restaurants, we haven't been taking expensive trips, we don't have cable television, I drive a couple of older cars that I bought with cash (one I got from my ex-wife for $600), we live in a modest house that I bought 6 years ago, we don't buy what we can't acquire with cash, and we generally avoid extravagances at this point in our lives. Don't get me wrong, we still have some fun, but we've mostly had our sights set on things we want in the future (these goals include an airplane for me, horses for her, and some acreage we can enjoy somewhere).

The easiest way I've found to save money was simply to continue living as I did when I was earning a lot less money (and my household income was much less thanks to a perpetually unemployed former spouse). I'm essentially still experiencing nearly the same standard of living that I had when I was supporting two people on a household income of $27K/year. Since my personal income (and our household income, thanks to an employed spouse) is now greater, we've poured the excess cash into the mortgage, her student loans, and our individual savings accounts. My overt fiscal lifestyle has changed very little in the past ten years, but I fully intend to wake up with a paid off house, some savings, and no other debt before the end of 2013.

The funny thing is, many of my colleagues in law enforcement seem to think that I've pulled off some debt-free "scam" because of some big-money job they assume I had in the private sector in the past... that couldn't be further from the truth, since I made much less there than I'm making in my government job now. The simple truth is, we're getting where we're going through good old fashioned hard work, and neurotically disciplined spending habits. No one ever accused a cop of being rich!

Some would argue that this was the wrong path to take... One of my closest friends already has all of the toys you could imagine, and has done a lot of financing to get there (he gets to enjoy them, but doesn't really own them). The truth is, financing is quite cheap these days, and debt can be acquired with a lot less cost than it could in the past. So, there is some argument for living your life on close-n-friendly terms with the local banker. Nevertheless, I like the idea of knowing that I own what I have, and don't need to sweat my financials all the time. I guess we'll see how it all works out in the long run, but hopefully I can ponder all of this with a few thousand feet of air below my butt in the near future!



(sorry guys, that was an awfully long life story coming from a guy who doesn't even own an airplane yet. I do have a kite though, if that helps)

I've been in three aircraft partnerships. The first was in a Grumman Traveler (AA5), the second was a Pitts S2A, and the third was a 182. None of these partnerships have cost me more than $20,000 up front and the partners made maintenance, hangar fees and insurance affordable. Unfortunately, partnerships in taildraggers are very rare. The opportunity to own a piece of a Pitts was far more unique than I realized at the time.

I am now 61, and my wife told me I should either stop talking about Maule aircraft, or just go buy one because my flying horizon is getting shorter, not longer. Interest rates are at all time lows, and my last kid just graduated from college. I also refinanced my house at a lower interest rate. When I did my financial analysis I found that all the other changes in my life lowered my monthly out of pocket expresses more than the cost of a payment on the plane of my dreams. So I went for it and bought a 2002 Maule MX7-180C. I take delivery in 3 weeks after some engine work is completed. It was a hangar queen and not flying is hard on engines.

Every major purchase in life requires a balancing act. Most of the aircraft owners I've met are more conscious about the real cost of their purchases than binge buyers that pick up dozens of toys without giving any thought to the cumulative costs of licensing, insuring and maintaining them. That is why there are so many used transportation toys (motorcycles, boats, quads, etc) for sale at bargain basement prices. There aren't many real buys on aircraft. Most of them are priced very reasonably given their condition. Flying requires more active thinking than most other hobbies and that clear focus seems to carry over into the sober financial assessment most pilots do.

Dave Ramsey would be proud Kevin. Good luck with the future plane purchase.

The last airplane I bought was a Luscombe 8A in 2006 for $15,000. That was only because I had just sold and expensive piece of land. When airplanes got above $10,000 I was done. Bought a CallAir for $12,500 in 94 only because I needed it and I made money with it.

coloradokevin wrote:...........The easiest way I've found to save money was simply to continue living as I did when I was earning a lot less money (and my household income was much less thanks to a perpetually unemployed former spouse). I'm essentially still experiencing nearly the same standard of living that I had when I was supporting two people on a household income of $27K/year. Since my personal income (and our household income, thanks to an employed spouse) is now greater, we've poured the excess cash into the mortgage, her student loans, and our individual savings accounts. My overt fiscal lifestyle has changed very little in the past ten years, but I fully intend to wake up with a paid off house, some savings, and no other debt before the end of 2013.........

Way to go, Kevin. That is pretty much my financial philosophy too. Some people don't seem to realize that they don't have to spend it all (right away too), just because they earn it.

My grandma had a saying, "Its not how much you make, its how much you save, that counts".

Caution: Shameless plug below:

Just an FYI - AOPA has now officially started their own finance division for purchasing aircraft. The idea behind it is that at least they know airplanes. A few years ago when we bought our 170, we talked to a few local and regional banks about financing part of it, and they had no clue what to do. When they found out how old it was, they said they couldn't help. Anyway, we got lucky and ended up not needing to finance. Long story short - AOPA wants to fix that problem by doing all the credit analysis, airplane evaluation, etc. themselves, and partnering with a few select banks on the back end.

And now to my point: My brother got a job with AOPA Finance as their senior credit analyst last month. They packed up this weekend and are moving the family out to Frederick, Md. So if you care at all about my family's well-being, call AOPA if you are thinking about buying an airplane and financing it!

I really don't know what all they offer as far as rates, etc, but it's one more option to look at. And if you call and get Brian, tell him Allen sent you.

Shameless plug over.