What Do You Need to Know Before
Buying Your Private Jet?
The world of executive aircraft sales is an especially difficult market to grasp with numerous factors driving a price point on the order of millions of dollars. Over the next few weeks, we will walk you through the steps needed to get you flying.
Why Use a Broker?
Developing a relationship with a professional broker is an essential requirement in buying your jet. An experienced broker knows all the market intricacies and will make buying your new business tool a delight rather than six months of headache and possible overpayment. Motivated individuals might think they can acquire their jet by themselves without a broker’s guidance. But, there are traps for the unwary that must be avoided in the acquisition process.
Suppose there is a used aircraft listed for sale at $10M. The avid, unrepresented buyer researches the internet and calls around the published listings for similar aircraft. Be aware professional brokers often mingle and share that they have interest in their listings. Due to the calls from the prospective buyer, the brokers believe that there is interest in their listing, but are unaware this market activity is all from one buyer. A false market is created, and the $10M aircraft that would have sold for $9M (by negotiation) is now going to sell for $9.5M because of the perceived market demand increase. The buyer has unknowingly overpaid by half-a-million dollars for his aircraft. Using a broker can help prevent misfortunes like this and others. With proper representation, you will be provided with a current and complete scope of available aircraft worldwide, allowing you to select the best aircraft that suits your mission profile.
Pedigree, damage history, and logbooks. Avionics, accoutrements, and engine/airframe care plans. These are only a few items to navigate that, if not properly investigated, can result in millions of dollars in consequences and reduced residual value. Combine these risks with the lack of published sale prices that no individual’s research can uncover, and it becomes clear why three-quarters of transactions are completed with representation on both sides.
A professional broker does way more than help you find the best airplane. There are several steps in the acquisition process which must be completed. A proper letter of intent must be written, negotiated, and signed. Then, a complete purchase agreement must be drafted and reviewed by all parties involved. The logbooks of the aircraft must be scrutinized. A pre-purchase inspection is next; the location of the maintenance facility as well as the scope of the inspection, specific to the aircraft, must be chosen. The findings of the inspection must be negotiated. The proper FAA title paperwork and closing must be arranged. Finally, the delivery must be organized.