Cessna 170 Loan Issues

juredd1 · Post by **juredd1** » Tue Dec 04, 2012 5:05 pm

Hello All,

I am in the process of trying to purchase a 1949 Cessna 170A and I am continually running into road blocks trying to find a lender to loan on a 63 year old aircraft. Below are the other issues I have run into;

The bank wants 40-50% down.
The bank wants copies of every entry from the aircraft log book since new and from the engine log book since last major.
The bank will only finance for 72 months.
The bank just won't loan on anything over 50 years old.

I have tried the AOPA lender (Bank of America) and every lender listed in trade-a-plane in the finance section.

Could anyone share with me if you had this type of trouble when you purchased or if you found a lender that was not this difficult to work with? If so would you share which lender you used?

Thank you,
Justin

bagarre · Post by **bagarre** » Tue Dec 04, 2012 5:53 pm

BANK OF GLEN BURNIE
P.O. Box 70
101 Crain Highway, South
Glen Burnie, MD 21061
Tel: 410/766-3300 Fax: 410/787-8597

The president of the bank is a pilot and has stated they will keep doing aircraft loans.

Not sure if you have to be local tho.

bigrenna · Post by **bigrenna** » Tue Dec 04, 2012 6:20 pm

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blueldr · Post by **blueldr** » Tue Dec 04, 2012 6:25 pm

I think that one of the principal problems in trying to get a loan on such an old airplane is that this type of an airplanes value is primarily in the eye of the beholder, so to speak. It is VERY difficult to get an accurate evaluation without an extensive and relatively expensive inspection, and even then, there is generally a good deal of personal opinion involved. The market for this type of airplane is not great enough to have developed anything like the "Bluebook" system on automobiles, and then automobiles, because of their popularity, are considerably easier to provide a difinative condition that a lender is able to understand.
Even though I've been a C-170 owner and fan of the model for many years, I have never owned other than B models and have never had any desire to own either of the other two. Someone with my outlook would be considerably less likely to look favorably on a loan to buy an A model than someone like Richard Pulley who is an obviously well satisfied owner of a A model.
It appears to me that your best bet is to try to float a loan with some other type of equity for security.

juredd1 · Post by **juredd1** » Tue Dec 04, 2012 6:46 pm

First of all thank you for the replies but dang folks you didn't give me much to smile about.

David, If my current process fails I will give that bank a shout.

Did every one here get bless enough to find a plane that came with complete logs? I have found several that are missing a few of the early years so that has knocked me out of several loan options. Nice planes I feel like but maybe missing 5-10 years of the early logs. Does that mean I don't buy?

I too would prefer a B model. To be honest I am not a saver so I am limited at this time. I have been looking at 170's for months now and for the most part a decent B model is 10 grand higher than the A model. Maybe I could save for a year or two and make up the difference but if I want to keep flying during the wait I will spend more than a loan payment in rental fees based upon flying 4 hours a month. So I have to make a decision of settling for an A model (No offense meant to the A model owners, hope to be one soon.) or don't own an aircraft for several, several months.

BL, I had not thought about putting up some other collateral for the loan. I may look into that as well.

Thanks again for your time,
Justin

bagarre · Post by **bagarre** » Tue Dec 04, 2012 7:15 pm

My airplane did have complete logs, less one page.
It happened to be the page that mentioned the missing 337 about a wing skin, some ribs, a repaired spar, fuselage bulkhead and related skins.

That really didn't bother me as much (as I have learned) as the other repairs that were never logged at all

At least the repairs were done properly.

It's not uncommon to be missing logs over the course of 60 years. I don't think that detracts from the value of the airplane, unless you are doing a historical restoration. Does it really matter if the plane was ground looped in 1958? I'm more interested in the last 20 years of logs.

But the person at the bank probably knows nothing about airplanes so you won't win that argument. In my case, they accepted VREF as the value because the insurance company didn't have issues insuring it for that much either. (Banks don't know airplanes, Avemco does).

BTW, there is no such thing as a 60 year old airplane with no damage. No damage history: Sure, they didn't write it down so there is no history.

Post by **Bruce Fenstermacher** » Tue Dec 04, 2012 9:58 pm

We've discussed the value of having all the logs before. And there is a value because the market is smaller of people who will buy a plane with some missing logs than if you have them all. I personally would buy a plane with missing logs but i wouldn't pay top dollar for it and I wouldn't expect to be able to sell it for top dollar either.

I've bought my first and third airplanes with home equity loans. Payed cash for my second and fourth aircraft.

bigrenna · Post by **bigrenna** » Tue Dec 04, 2012 10:30 pm

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Bill Hart · Post by **Bill Hart** » Tue Dec 04, 2012 11:46 pm

Justin,

Have you tried a local bank or credit union? These normally have a real person who you can talk to. I have used a small bank with 3 aircraft loans and never ran into an issue. The key I felt was that I would go in and sit with the loan officer and answer their questions. After the first 2 loans of increasing value when I came in with the 3rd for my 170 that was 1/2 of my 2nd loan thier were no questions asked because they knew me and knew I had do my homework.

Good Luck,

Post by **GAHorn** » Wed Dec 05, 2012 12:13 am

Justin, it will do you well to make certain you are talking to a banker that regularly makes aircraft loans. Assure them the airplane will be insured for full loan value...with the bank named as lien holder. What else is their problem?

As for missing logs: It is my personal belief that "missing" logs are actually "deliberately destroyed" logs. Someone is hiding something. (See a post where I told a personal experience about this: http://www.cessna170.org/forums/viewtop ... ire#p31602 )

The ONLY case I've found in over 40 years in this business where that was not the case is when the aircraft has been foreign registered and the logs were retained by the exporting country authorities...and even that is a rare event.
(My own airplanes logs were retained by El Salvador, but I have microfiche copies of them....in Spanish!...for whatever good that is for an airplane that was wrecked and totally rebuilt.)

I don't mind an airplane with damage history. Properly repaired and documented, they are as good ...if not actually BETTER than simply old. (At least they've been properly opened up, inspected, and old parts replaced, and documented. What I don't like is airplanes with "no damage history".....How many "no damage history" airplanes are still out there flying around with their original fabric-covered wiring and corroding sheet metal, and dark recesses that haven't seen the light-of-day for 60+ years?)

3958v · Post by **3958v** » Wed Dec 05, 2012 2:30 am

Greg I do find your coment on earlier 170s offensive. There are plenty of people on this forum who are satisfied with their 170As and ragwings. I have had a ragwing for almost 20 years and I see no one in our area regularly doing anything with their B models that can not be done with the other 170s. I would politely request that you please think twice before attacking other forum members airplanes. It is my opinion that Ragwings and A models can represent a great value for someone getting into a classic airplane for the first time. Bill K

bagarre · Post by **bagarre** » Wed Dec 05, 2012 3:12 am

Well, since we're throwing opinions around.
1952 was the best year for the 170 IMHO. Still has the beautiful panel with piano keys but has the new wing with big ole flaps.

Seriously, don't hesitate to look at the earlier 170s. If you've never flown the others, you wont notice the difference. They both land pretty short and they both take off pretty long

If money is a real issue the straight 170s and A models are priced a little cheaper and you wont be disappointed.

pojawis · Post by **pojawis** » Wed Dec 05, 2012 3:43 am

I bought my a/c through an equity loan. It was no big deal. Just don't tell the lender that it's going to an aircraft purchase. Mine was for a "home improvement"; and it was the truth. My home is vastly improved with a red-and-white 170B close to it.

An alternative is what a friend of mine did. He wanted a 7EC, but never did find one that worked (clouds on titles, sketchy details, etc.). He settled on a BEAUTIFUL 150 (also red-and-white) circa $20K. He flies often and hasn't looked back. He's been offered more than he paid several times for it. Moral to the story: If you want to get into the air, find something that fills the mission and suits the bank account. Trade "up" when you're ready.

Post by **GAHorn** » Wed Dec 05, 2012 5:15 am

3958v wrote:Greg I do find your coment on earlier 170s offensive. There are plenty of people on this forum who are satisfied with their 170As and ragwings. I have had a ragwing for almost 20 years and I see no one in our area regularly doing anything with their B models that can not be done with the other 170s. I would politely request that you please think twice before attacking other forum members airplanes. It is my opinion that Ragwings and A models can represent a great value for someone getting into a classic airplane for the first time. Bill K

Bill.......: AMEN!

I personally wanted, and have, a B-model. For various reasons, and due to a particular airframe, it was my personal preference.

BUT.... anyone who thinks a 170 MUST be a B-model in order to excell..... doesn't understand the genre. You don't find better examples of this airplane than a few of our Member's ragwings or Jacobsen's A-model. They'll stand up to anybody's B-model!

The straight 170 is a CLASSIC in the truest-sense. It is an innovative aircraft that introduced the modern aircraft design concept of affordable, modern, monocoque aircraft incorporating follow-on improvements of existing, proven design (C-120/140). Even the early-day concerns of fabric longevity has been solved with modern materials. To me, those ragwings are like fastback P-51s compared to D-models..... the ragwing is THE classic 170!

The 170 A-model raised that concept to a new level using all-metal design to increase durability and weight-savings without having to resort to frieze type ailerons to avoid high control-forces, and it introduced single struts, dispensing with jury-struts while reducing wing complexity.

In my opinon, the straight 170, and the 170 A-model are the pedigreed CLASSIC aircraft, and the prototypical models of the most successful series of general aviation aircraft in history (which only resulted in the B, which morphed into the Skyhawk.)

There is NO REASON a straight or A-model ....or their owners....should accept any assignation to obsolesence or diminished acclaim to prominence in the single-engined Cessna line. THEY are the leaders of the pack, IMO!

While the "B" may enjoy some minor improvements in design, ...the B is actually merely a transition model to the lesser tri-cycle, which "anyone who can drive can fly airplanes" type. The chief advantage of a B is that it has a slightly better relationship to the common Skyhawk, and therefore slightly better parts-availability...and (only barely, almost unnoticeably) better performance, because of it's flaps, which also incidentally, contribute to operating limitations the earlier models do not suffer. It's a trade-off.

I think the "ragwings" are beautiful. And the A-models have a look which retains more of the "classic" than the later B's due to their purist-look of straight wings. (I think they look even better with a long, shark-fin, Kohler or Kollsman pitot tube.)

All of them will get into fields shorter than they can get out of...including the B-models... so if a 170 or a 170-A is found that strikes one's fancy... then buy it! Don't worry about the silliness of flaps and dihedral.... unless cabin-heat, floats, or those obnoxious "L" engines are your fetish must-haves!

My dos centavos.

bigrenna · Post by **bigrenna** » Wed Dec 05, 2012 3:56 pm

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The International Cessna 170 Association