Flight School Loan Question

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07-03-2006, 04:34 PM

HSLD

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Flight School Loan Question

I was looking at the ATP website, graduate list, and had a question about commercial loans to attend this type of training.

I'm guessing that most applicants don't have $40K+ to attend, so how do most participants finance the training?

What percentage of tuition, on average, is financed?
What is the APR?
Are the loans available part of a federal program?

My intention is to produce a spreadsheet that compares future value of a dollar, vs. tuition/loan, vs. entry level salary/career progression. Of course the trick will be to make the output useful and meaningful. Any additional information or details about the way such flight academies are financed would be appreciated.

Cheers -

07-04-2006, 06:36 PM

crewdawg52

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Good luck. Pay the tuition, get that 20k job, then try to pay the loan back while living on the $ you make.

07-04-2006, 10:32 PM

SkyHawg

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You can get the loan from any bank. ATP is making a little money off the loan from the referral fee. It is not a federal loan, it is a private loan. Interest rates are between 6-10% with a origination of around 5-7%. You will get a better rate with a co-signer with good credit.

07-04-2006, 11:47 PM

HSLD

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Quote:

Originally Posted by SkyHawg

Interest rates are between 6-10% with a origination of around 5-7%. You will get a better rate with a co-signer with good credit.

You do mean Prime + 6%-10% right? Are there actually banks making sub-prime loans for flight training?

07-05-2006, 01:06 AM

SkyHawg

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Some do 4% + LIBOR and some do 4% + Prime.

07-05-2006, 06:45 AM

Flying Ninja

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Quote:

Originally Posted by HSLD

1. I'm guessing that most applicants don't have $40K+ to attend, so how do most participants finance the training?
2. What percentage of tuition, on average, is financed?
3. What is the APR?
4. Are the loans available part of a federal program?

1. Some people have the money to pay it up front whether they saved up for it or were blessed by the Bank of Mom and Dad or the family trust fund. Others have th bankroll the whole thing with a private loan and/or personal savings.
2. Depends on the individual's situation.
3. Typically it's around 4-5% + Prime or LIBOR. Either way, it translates to a hefty APR at the end of the day. I noticed on my loan that if I follow their payment schedule, they would have made 1.5X what I borrowed, which is to say, a pretty substantial amount.
4. I looked everywhere for federal loan programs for aviation training. Sadly, unless you go to an accredited university/college and they have a flight program, you won't find a federal loan for your flight fancy.