Good form

Tips for filling out the online application

September 1, 2022 By Adam Meredith

There’s a saying that “time kills all deals,” and it is especially true in today’s tight market. That’s the primary reason application accuracy matters. Improperly filling out a form increases the amount of time it takes to process the application. The income, assets, and liabilities you state will be validated by the lender.

Almost as often as not, we see applicants misstate their aircraft usage intention on the online form. It is our experience that people generally have a good idea of how many hours they intend to fly their new airplane and if it’ll be truly for personal use, under a dry lease arrangement, or under a leaseback to a third party, so it’s best to provide that information as soon as possible.

If you present one way on the application and then attempt to change how you present well into the process, not only could it reset the whole application timeline, but it could also possibly cancel the entire transaction.

The personal financial statement is another part of the application that can cause issues if not filled out properly. Omitting information from it could dramatically reduce the number of options AOPA Aviation Finance can provide for financing. Past omissions include bank account disclosures, as well as cash-on-hand disclosures. Without knowing how much liquidity an applicant has, neither AOPA Aviation Finance nor its lenders can determine if there is a financing option.

Other issues encountered include buyers who initially apply as an individual, but then choose to include their spouse’s income. That can be done, but it means starting over and filling out the application for joint applicants. The same holds true if a person chooses to register the airplane under a business entity in which they have only partial ownership. They will need to add their spouse on a joint application or add a partner or partners to the loan. All partners included in the ownership of the airplane will need to complete their own application.

The most egregious example is when a borrower produces a certificate of insurance that is not representative of the application. For example, the borrower indicated to the lender they had established a single purpose entity—LLC or otherwise—under which the airplane would be held for personal use. However, when the certificate of insurance arrives, the insured party is a flight school. Not only could the bank halt the process, even when it’s 95 percent complete, we’ve seen banks pull the loan.

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Adam Meredith

President of AOPA Aviation Finance Company

Adam Meredith, the longtime president of AOPA Aviation Finance Co., died after a long battle with cancer in December 2023. He is remembered for his passion for helping fellow pilots, leading a team devoted to putting flight training and aircraft ownership within everyone’s reach.

Go to Adam Meredith's Profile

Aero Space Reports

Sponsor of Aviation Finance

Aero-Space Reports, a third-generation family-owned business, has been a leader in the aviation title industry for more than 45 years. In that time, they’ve seen tens of thousands of aircraft purchases: They’re all too familiar with what can go wrong, and they know exactly what it takes for things to go right.