How does loans work?

[PilotLevi]

I know nothing about loans nor does my parents. I'm 17 years old, turning 18 in august. (no credit) Anyways How will I go about getting a loan, getting my pvt helo(add on), instrument, cpl, cfi or however far I can make it. It'll be at a part 61 school. Then enter college without having to pay off those loans until after college?

[HH60Pilot]

I know nothing about loans nor does my parents. I'm 17 years old, turning 18 in august. (no credit) Anyways How will I go about getting a loan, getting my pvt helo(add on), instrument, cpl, cfi or however far I can make it. It'll be at a part 61 school. Then enter college without having to pay off those loans until after college?

 

I wouldn't be too sure about being able to defer payment until after college. That will be up to the lending institution. I think that you will have better luck in getting it deferred if you get a SallieMae loan for your flight training, as I believe that they allow you to defer if you are attending a Title IV school (college or university). Some lenders, such as Pilot Finance Corporation, will not allow you to defer your payments. Be sure to ask the lenders before you sign the papers and send them in.

 

Doug

[fry]

I know nothing about loans nor does my parents. I'm 17 years old, turning 18 in august. (no credit) Anyways How will I go about getting a loan, getting my pvt helo(add on), instrument, cpl, cfi or however far I can make it. It'll be at a part 61 school. Then enter college without having to pay off those loans until after college?

 

Basically, there are "student loans" and there are loans while you are a student. Student loans, the kind with the beneficial features are federally guaranteed Stafford & PLUS loans. These loans have rates of 6.8% and 8.5% respectively and they have neat features like deferred payments and interest forgiveness. The bad news is you won't qualify unless you are enrolled in an approved educational institution...college. Flight training alone, especially Part 61, won't qualify.

 

That leaves the other kind of loans. These are unsecured loans (think credit cards) offered by banks to those (or their co-signors) with acceptable credit and income. Rates are going to be above those of the federally guaranteed loans because...well, they're not guaranteed by the feds. Payments and interest can be deferred but all that does is tack the interest onto the loan amount making the eventual loan that much larger.

 

Sallie Mae is essentially a loan facilitator...the loans, federal and non-federal, are really made by banks. Here's the info site:

 

http://www.salliemae.com/get_student_loan/...ent_loan_types/

 

By way of an example, if you were to get a $65,000 loan an pay it off over 20 years at 9% the monthly payments would be $585 and the total cost would be more than $140,000. That's a lot of money for a course of training that is only good if you get to 1,000 flight hours and get a real paying job. Good luck.

[DFWFlyer]

unless you are enrolled in an approved educational institution...college.

 

Do programs like the UVSC Global Flight program qualify you for the Federal loans?

[67november]

Do programs like the UVSC Global Flight program qualify you for the Federal loans?

 

i beleive they do.

 

check the faa school search to be sure

[fry]

How will I go about getting a loan, getting my pvt helo(add on), instrument, cpl, cfi or however far I can make it. It'll be at a part 61 school. Then enter college without having to pay off those loans until after college?

 

That sequence of events won't really work. You might be able to get a training loan and have payments deferred for awhile (http://www.salliemae.com/get_student_loan/find_student_loan/training_loans/career_training_loans/) but, entering college won't continue the deferral.

 

Try this instead, enter college and get a federally guaranteed loan where the payments are deferred and no interest accrues during the deferral period. Live at home and use part of the loan money for flight training on a pay-as-you-fly basis. Get a business degree in college...the course of study is not too demanding so you can concentrate on the flying and it'll probably come in handy later on in your career.

 

Or, go to college, get into the ROTC program and after graduation enter the military. Let them teach you to fly.

 

Good luck

[blave]

I know nothing about loans nor does my parents. I'm 17 years old, turning 18 in august. (no credit) Anyways How will I go about getting a loan, getting my pvt helo(add on), instrument, cpl, cfi or however far I can make it. It'll be at a part 61 school. Then enter college without having to pay off those loans until after college?

 

One positive step towards a career in aviation is: learn basic grammar and spelling, or at least how to construct a sentence. I know this sounds harsh, but being able to write well is a dying art and it would serve you well in *any* career.

 

Also - save up as much money as required to finish ALL of your ratings ahead of time, and try not to rely on bank loans. They will SUCK YOU DRY over the next several years, via their high interest rates. Do the 'hard math" to compare what you will owe on a bank loan vs. what you will be making as a helicopter pilot in your first few years, which will be FAR LESS than what you think/hope it will be. I promise that that initial loan will take far longer to pay off than you think it will. I also promise that any bank or flying school that wants to finance your flight training will do whatever they can to gloss over the harsh reality of having to pay back a $60,000 loan over the next five or ten years (I am using that figure as an average on what it takes to becme a CFII).

 

I started flying helicopters in 1983, ran out of money, and (due to many life events and higher priorities) finally finished my helicopter private rating in 2003, and subsequently finished the commercial rating earlier this year. Fortunately I have a "real" career (in high tech) to rely on, courtesy of a college degree, and I'm thankful that I was able to finish any helo ratings at all! But the key message here is to have an alternative career plan. From what I can see, aviation - particularly on the helicopter side of things - is merciless and even after those first few years of trying to build 1000 hours to become "basically employable" as anything other than a CFI, you will never make as much $ as you think you should, given the risks and compromises that are typically required.

 

Everyone here loves to fly or dreams of flying, but the road to being paid a decent amount to do it as a career is steep and in the end, really doesn't pay as well as it should given those efforts and time. I am (no lie) grateful that I get to fly as a hobby/passion, rather than have to rely on it to put food on our table.

 

With all of my naysaying, gloom, and doom, I sincerely wish you the best in making your dream a reality. All I am saying is, do not dive into this adventure until you have ALL of the financial and career growth considerations well in hand.

 

 

Dave Blevins