Loans

[PGA07]

I know that there is a strong feel amongst most on these boards to avoid the loans. I am one of those who oposes (SP) going this route. However some very interesting things are begining to develop in the career of my significant other.

I may have the opportunity to take out the loan, fly my rear end off and get this career started much sooner and faster than I originally thought. She makes good money and it is going to be making even better money in the near future (6 months or so).

She supports the flying bug and with all credit cards paid off and one vehicle getting paid off very soon we would not have many expenses, other than school loans (in addition to rent, food, etc). Would any of you take advantage of the situation and take the loan out knowing that you will be able to double up the payments once repayment begins? I am curious to the thoughts on this matter!

[pedro]

I would...not that its the smartest thing to do but I too plan on taking out a loan for training. If you can double up on the payments and pay it off in 7 instead of 15 years then its not too bad. Lets just hope you and your SO have a great relationship throughout the first few years!

[SteveC]

Have you made a list of the things that could go wrong with your scenario, and what the potential consequences might be for each?

I'm a firm believer in planning for the worst, committing to the plan, then enjoying life when things turn out better than planned.

[PGA07]

Originally Posted by SteveC

Have you made a list of the things that could go wrong with your scenario, and what the potential consequences might be for each?

I'm a firm believer in planning for the worst, committing to the plan, then enjoying life when things turn out better than planned.

I have looked at all scenarios and considered what may or may not occur. Thank you for your insight. Good or Bad the people on this site tell it like it is and that is what I like.

I agree with planning for the worst and enjoying life when things turn out better than you thought. I am still a little hesitant about taking the loan out, but I may in fact do it. I have a bit of time yet and I will continue to look at all angles.

[pedro]

Originally Posted by SteveC

I'm a firm believer in planning for the worst, committing to the plan, then enjoying life when things turn out better than planned.

thats good advice. planning your financial situation with a few hypothetical hiccups makes the good times (when they come) even better.

[milski]

If you are so set on taking the loan, I would wait at least until your wife gets the expected pay increase instead of taking in just on the expectations of it.

[skidz]

I would never take a loan in my life if I didn't have to. Unfortunatelly, it is very hard to do something like this without taking a loan. For my private I went through half a course and then I took a loan to finish it. It's been long gone and paid for, you got to know yourself, if you have discipline to slow down for a while after you get your goal and pay it off there's nothing wrong with that. I'm getting another loan now because otherwise I'd never get into the training. In my opinion it's better to go fly as often as you can and knock it out in some reasonable time even if that means taking a loan rather than stretch it forever without end in site while trying to pay off as you go. Well, sometimes you just have to suck it up and do it and worry about it later. It is a good idea to avoid loans and credit cards at any costs, but you have to know yourself. I have never been late on any loan in my life and I have had probably half a dozen of them.

[PGA07]

All very good points! I thank everyone for their input and advise. I am looking at it as an educational loan. Every day people are taking loans out for educational purposes.

What is so different from taking a loan out to fly and someone who takes one out to go to university? They are serving the same purpose, which is allowing someone to advance their education to make a better life for themselves.

Granted, most will come out of university with a better paying job than a CFI or regional pilot! However, we must do what we need to to reach our goals in life.

[skidz]

Originally Posted by PGA07

Granted, most will come out of university with a better paying job than a CFI or regional pilot! However, we must do what we need to to reach our goals in life.

That's exactly. I mean, you can save up for couple years and get it done, or you can take a loan, do it now and pay it back while getting your career on track. You have to believe in yourself that you are going to do it, because if you don't then the investment doesn't make any sense. I look at it as an investment. I would almost never take a loan for something that wouldn't have some kind of return on investment.

[PGA07]

Originally Posted by skidz

That's exactly. I mean, you can save up for couple years and get it done, or you can take a loan, do it now and pay it back while getting your career on track. You have to believe in yourself that you are going to do it, because if you don't then the investment doesn't make any sense. I look at it as an investment. I would almost never take a loan for something that wouldn't have some kind of return on investment.

Which is exactly why the new vehicle is not going to happen! I am limiting all external cash flow. For the first time, I am 100% set on doing this for a living!

It took many years of doing my own thing along with the help of some external forces to make me realize what I truely want. Now that I know, it is full steam ahead (within reason, no SJS here)!

I am really looking forward to what the future has in store. I will enjoy every step and be greatful that I have the opportunity to pursue this profession.

[killbilly]

Originally Posted by PGA07

I am really looking forward to what the future has in store. I will enjoy every step and be greatful that I have the opportunity to pursue this profession.

I'd just like to point out that a few bets on the putting green with the right partners will go a ways toward paying for your flying.

[PGA07]

Originally Posted by killbilly

I'd just like to point out that a few bets on the putting green with the right partners will go a ways toward paying for your flying.

How true! But then I would feel guilty!

Seriously though, I would! But then again, I may get hustled!

Like they say, easy come, easy go!

Money earned is almost as good as money taken!

[pedro]

Originally Posted by PGA07

What is so different from taking a loan out to fly and someone who takes one out to go to university? They are serving the same purpose, which is allowing someone to advance their education to make a better life for themselves.

I think that it's because you are entering such a volatile job field where anything can happen and POOF! your out of a job. On top of that, you need a regular degree as well so it makes your "education costs" skyrocket. You are right though that it is an investment. I can tell that it's not SJS, might be a little SCS though (shiny Cessna syndrome) I think we just cant wait to fly period

[killbilly]

Originally Posted by PGA07

How true! But then I would feel guilty!

Seriously though, I would! But then again, I may get hustled!

Like they say, easy come, easy go!

Money earned is almost as good as money taken!

See, I always remembered that quote from "The Color Of Money" when Eddie says, "Money won is far sweeter than money earned."

That said - I doubt there are many people who could hustle you with your handicap.

Hell - I'd need a minimum of 10 strokes a side to even *think* about a golf bet with you.

[PGA07]

Originally Posted by killbilly

See, I always remembered that quote from "The Color Of Money" when Eddie says, "Money won is far sweeter than money earned."

That said - I doubt there are many people who could hustle you with your handicap.

Hell - I'd need a minimum of 10 strokes a side to even *think* about a golf bet with you.

What a great movie that was! The thing of it is............IT'S TRUE!

For me, there is nothing sweeter than coming out victorious in a little head to head competition!

I have not touched a club in 3 months! The game is getting away from me. Unless you are beating balls everyday, you do lose it and lose it fast! I probably won't touch a club again (other than in the living room) until January when I climb out of the trees!

[BugSmasher]

Originally Posted by milski

If you are so set on taking the loan, I would wait at least until your wife gets the expected pay increase instead of taking in just on the expectations of it.

Did you get a good loan offer through a bank affiliated with a flight school or your regular bank? Is there any possibility of a fixed-rate loan or using home equity?

As for what you're doing - many have taken out loans before and wound up paying them off just fine! We're not getting any younger, right? But I gotta agree with what milski's saying, and would add that making your decision to take out a loan contingent on someone else's prospective income might be risky.

You might want to consider a backup plan career-wise, something you can do on your days off that'll utilize the skill set you already have, to help pay those bills when your on reserve, on yr 1 FO pay, furloughed, etc. The bills will be a constant when everything else may vary.

Good luck!!

[PGA07]

Originally Posted by BugSmasher

Did you get a good loan offer through a bank affiliated with a flight school or your regular bank? Is there any possibility of a fixed-rate loan or using home equity?

As for what you're doing - many have taken out loans before and wound up paying them off just fine! We're not getting any younger, right? But I gotta agree with what milski's saying, and would add that making your decision to take out a loan contingent on someone else's prospective income might be risky.

You might want to consider a backup plan career-wise, something you can do on your days off that'll utilize the skill set you already have, to help pay those bills when your on reserve, on yr 1 FO pay, furloughed, etc. The bills will be a constant when everything else may vary.

Good luck!!

It would be a tremendous rate through a private military bank, fixed rate. I understand the concern about banking on someone else's income, however, I would still be able to make the loan payments, just by getting rid of the vehicle payment. The only reason I mentioned the additional income was for comfort reasons.

I would keep a full time job while flying roughly 3 days a week. Then I would still work that job while transitioning into the CFI/II role (starting with weekends only). Once I have a full student load, I would transfer into teaching full-time, while trying to keep the previous full-time job as a part-time job.

I plan on instructing for a while because I am still not sure I want to go the regional route. With 91/135 times what they are, I will be around a while building that time (which is ok).

[Sprint100]

If money will be that good, wait and pay as you go. Cool that you thought of some bad things that can go wrong but there is one thing that you can't properly think of...Murphy's Law. I could have taken out a loan and went to ATP back in the day, but things came up way down the line and I was elated that I didn't take out a loan. If you have no income and need to start a career, then take out a loan. But if you're making money then pay as you go. The only loan I would take that I can't pay off in less than 4 years is a home loan.
Man, doesn't anybody listen to Tom Leykis when he talks about finances? Leaning on your girlfriend to help finance it is just crazy. It wouldn't be bad if she were your wife and even then things could go downhill too.

[Sprint100]

Originally Posted by pedex

I think that it's because you are entering such a volatile job field where anything can happen and POOF! your out of a job. On top of that, you need a regular degree as well so it makes your "education costs" skyrocket. You are right though that it is an investment. I can tell that it's not SJS, might be a little SCS though (shiny Cessna syndrome) I think we just cant wait to fly period

I'll clarify this a bit since any job/company can go poof. Thing is, a pilot doesn't have many options to do the same thing (like some careers) when things go POOF. Let's say you got a degree to work with computers, if things go awry at the company you are currently with, more jobs/options will be open. I'm not an advocate either way, I'm just putting it in perspective...I hope!!!!