$45,000 hurts.....

[Wing_96]

Originally Posted by troopernflight

But if you can afford to pay it back quickly after your flight training is completed, then it is a viable route to take.

A loan of $45,000 will not be paid back quickly when only making $20k/year as an airline new hire.

[killbilly]

Originally Posted by troopernflight

Yeah, I didn't say it was perfect. But if you can afford to pay it back quickly after your flight training is completed, then it is a viable route to take. If you only take 1 lesson a week when that's all you can afford, it will take significantly longer to complete training. If you are in a 141 school this could cost quite a bit more money just doing recurrent training because you couldn't remember something you went over in the past. But that's the key, paying it off quickly after completing training. If you plan to pay out to the full term, then the bank will stick it to you.

And there's the rub. Because the way I see it, if you can afford to pay it back quickly, (say, 36-48 months) then you've got the money to pay cash as you go, maybe bank some of that money in a CD or something and pick up at least a little interest along the way.

[wheelsup]

Originally Posted by LoadMasterC141

Get GI bill money so they pay up to 60% at approved part 141 flight schools? 4 years.

That's what I was referring to.

Not to mention the skills acquired in the military - I wish I would have done it to be honest. 4 years and live frugally while you are there (none of this 350Z / Lincoln Navigator / Mercedes C320 leasing like the guys here do) and you can probably pay cash. That's pretty good for 4 years of service IMO.

[troopernflight]

Originally Posted by Wing_96

A loan of $45,000 will not be paid back quickly when only making $20k/year as an airline new hire.

Ok, here's what I meant guys. Don't go work for the airlines right away. Continue your current ground job, do some instructing on the side. Take any money you make from instructing and pay it towards the loan. Also take any extra money from your regular pay check, and pay it towards the loan. Get a part time job, pay that money towards the loan. Not saying you won't have to sacrifice for a while, but it's one route to take. I'm sure this is a preferential thing, and that some have had success in other ways. I'm just putting one viable option on the table here...

[killbilly]

Originally Posted by troopernflight

Ok, here's what I meant guys. Don't go work for the airlines right away. Continue your current ground job, do some instructing on the side. Take any money you make from instructing and pay it towards the loan. Also take any extra money from your regular pay check, and pay it towards the loan. Get a part time job, pay that money towards the loan. Not saying you won't have to sacrifice for a while, but it's one route to take. I'm sure this is a preferential thing, and that some have had success in other ways. I'm just putting one viable option on the table here...

Troopern, you're right. That is a viable option, but it's not one I can see making a lot of sense. (I'm making this same point in another thread.) If you've got the money from a regular job to service the loan, then in all probability you have the money to pay cash as you go without incurring debt. I see the point about instructing, building time while keeping the day job, and there are merits to that argument, but at the same time, you can get to a CFI rating for way less than that, still build time, still pay cash, and add ratings as you have the money to do so. It comes down to the fact that your method gets you there faster. If that's number one priority, then it might be a good plan for you. If it's not, I'd counsel patience and taking more time, paying less interest.

There are a few of us (can you tell?) who are vocal and seriously opposed to large loans (SteveC, Loadmaster, me, a few others) but that doesn't mean we're necessarily right. If it works out for someone, more power to them. It's just that personally, I have seen younger folks (than me) getting into debt situations that they couldn't handle, because on paper it looked good, but real life got in the way. I am formerly one of those people and I spent YEARS extracting myself from hellish debt and bad credit as a result of making those decisions. This is one of the few areas of experience I can speak to in an educated manner around here, and I just want to help someone potentially avoid making the same mistakes I did.

It's about having information and options. Options = freedom, IMHO.

[aerospacepilot]

Originally Posted by ilove747s

$45,000 loan @ 11% with 15 yrs

= $511.47/mo.

$92,064 total paid

Just another reason not to go to ATP or any other flight academy, especially if you cannot pay cash up front.

I ran the same numbers with a $63,000 loan (the cost of ATP) at the same 11% for a 15 year loan, and it turns out to $716 a month and a total of $129,000 paid. What a ripoff!!


Ilove747s, here is my specific advice to you.
First, do you have a 4 year college degree? If not, that should be your first priority. As for flight training, you DO NOT need to go to a flight academy. I am predicting I will finish all of my licenses and ratings (Private through MEI, including a glider rating and tailwheel endorsement) for about $30,000. I am flying in one of the most expensive areas in the country (SF Bay Area). The best thing for you to do is go to the nearest 3 airports near your house and check out rental prices. Make a budget based upon the hours of airplane and hours of instruction you will need, total it up, and look at the savings.

Run your numbers again with a $30,000 loan, 11%, and a 10 year payoff.
You pay $413.25, and a total of $49,500. See the difference of training at a local FBO versus ATP (especially if you need to take out a loan).
The reason I used 10 year payoff is because your monthly payment will be much less, since your loan is for much less.

So get a 4 year college degree (if you don't already have one), then go out and find a few local flight schools, then take out a loan if you need it. Do not go to ATP or any other flight academy as they are much more expensive, and the compounding of that extra expense is just way too much ($49,500 versus $129,000 paid over the life of the loan).
Good luck.

[ftyflyboy]

Be prepared for many guys telling you that taking a loan for your education is the the equivilant of selling your soul to the devil.

I am a student at ATP and did my loan through teri.org current rate is %7.49 They were very easy to work with as well.

If flying is something you want to do and have no other way of paying for training, get the loan and chase the dream my brother!

Good luck

[LoadMasterC141]

Originally Posted by ftyflyboy

Be prepared for many guys telling you that taking a loan for your education is the the equivilant of selling your soul to the devil.

I am a student at ATP and did my loan through teri.org current rate is %7.49 They were very easy to work with as well.

If flying is something you want to do and have no other way of paying for training, get the loan and chase the dream my brother!

Good luck

I don't think anyone will say that. The simple fact is that sometimes we become blinded by desire to achieve a goal, unable to see the cost of getting there. I say we because I am also in that boat. I will actually end up a bit in debt for my flight training as well. Nothing to the tune of $60k, but a little, just to expedite a few things.

People at Jetcareers are warning people about loans because alot of people here at Jetcareers have taken these loans, and either regret it or admit to wishing they had done it differently. It is simply paying it forward to give this advice. Ultimately, it is up to the individual to make the choice.

[troopernflight]

Yeah, you could definitely make some devastating choices if you are not prepared. That's the problem with ATP, your main goal is getting on with the airlines, that's why you are there. Then comes the 20k/year earnings, after borrowing 60k. Do it at your local airport for 30k, it'll get you to the same place. Just not as fast.

[erikN]

I know the situation is different in the USA with the need of a 4 year degree, where I will work there's not the same need for it.

So I spent a year in my countrys army and then worked for two in a retail store to save up the cash = 0 debt. Matured alot during that time. Gained much valuable real life experience.

[Murdoughnut]

Here's something to chew on - I've been anti-big loans since I've been on this board and have told people to work and fly like I've done. I've come to a point now (120 hours, soon to have IR and multi) where I'm considering taking out $10k or less to just finish up and fly for a living. Basically I'm sick of my current job - it's a good job, but being chained to a desk 9-5pm with absolutely no flex time whatsoever is seriously putting me into a funk. It's taking a toll on my family and my friends, and has seriously made me into an all around f@$%tard.

I'm in an ownership group and though our rates just went up ($62.50 wet now for a 172), it's still very reasonable for me to pick up my remaining flight time, 50 hours of multi, and a CMEL for under $10k. I'm considering just taking the plunge and doing it. Yeah, I hate to have even a debt like that, but what's the price of being miserable?

[bigs]

Figured I'd chuck my two cents in on this one, for what it's worth. My folks (retired military dad, teacher mom) took out a loan for $75k so I could go to Pan Am in Ft. Pierce for Instrument through CFI. I had already gotten my PPL at an FBO in Maine. Rolled into that was a $10,000 car payment, $5000 credit card, $12000 for checkrides, books, living, and miscellaneous expenses for the year because you couldn't work while at Pan Am, and approximately $48,000 for training costs (including the screwjob $2000 "breaking your contract" fee) if you choose not to complete the program.

Long story short, first week of instrument training September 2001 happens. Obviously far-reaching implications throughout the industry and on flight schools. The guaranteed salary CFI job disappeared, the waits for 141 stagechecks and checkrides were sometimes 3-4 weeks (passed all except one on the first attempt), and the program was changed so you had to go all the way through ACE and Route instead of working your way through CFII, MEI, ACE, and Route while working as a CFI. This all added a lot of time and expense (in the form of living expenses, etc.) and I elected to leave after CFI because they had not held up their end of the bargain or offered anything beyond "here's the number to Key Bank, see if you can get another $20,000".

Moved to Virginia in 2002 and took a 40k job in healthcare sales, which fortunately I had enough experience previously to move back into. Worked my way up through a couple of different companies to the point where I'm now making $90,000 base plus commissions. I started in 2002 paying $750/month, and my folks were generous enough to help out with paying down the balance as well. As my pay situation improved, so did the amount I paid each month until for the past year I was paying between $1250 and $1500 per month. At the end of September I wrote a check for $10,000 and finished off the remaining balance of the loan...total time to pay off was just over five years.

Being in the above situation absolutely sucks, and anybody who has been in that kind of debt (particularly tied to a mortgage on a loved one's home) knows that it keeps you awake at night. If you have to take out a small loan then do so, but speaking from experience...stay out of that situation if at all possible.

Throughout this time, I've kept my CFI current through the bi-annual FIRC process, and flown here and there, although not nearly as much as I'd like. I've been teaching part-time recently and am working with an awesome group that does ground schools at local FBOs. My wife, who makes a great salary, is finishing up her loan as well and we're paying off the last of our credit card debt (paid off almost $25,000 in the past year). We have a home and are saving money, and within the next 4 months I will finally have saved enough to make the leap to aviation full-time if all goes as planned.

Bottom line...pay now or pay later. Gotta tell you, though, having that kind of debt hanging over your head and not being able to afford to fly sure sucks a lot of the joy out of aviation. Best of luck to anyone in weathering the struggles, though, I think flying will be worth it in the end.

Bigs

[Murdoughnut]

That's some good advice up there.

[cfii2007]

Sounds like what I did.....took a year off from flying all together and worked a second full time job. Paid off all loans in about 10 months.

[HerkFCC]

Originally Posted by wheelsup

Why not do the military thing and have them pay for most of your training? I think all that is required is 4 years of service.

It can be done, even if you are an enlisted guy like myself.

I got my career status bonus recently (30g's tax free up front at 15 years time in service) and the GI Bill for after my private at a 141 school and I should be good to go. It was the only reason I took the bonus in the first place was to pay for flight training.

Now, I just have to find the time to git er done...

[Pietrantonio]

I noticed that everyone only talks about first year FO pay. It looked to me like pay increases every year, and when you upgrade to Captain, you get even more money. You can always factor that into your paying the loan back scenarios right?

[jima7011]

Originally Posted by scramjet

I'll never go into debt to pay for flight training even if it means it will take me a long time. In this industry, it's just not worth it to overextend yourself for $50k-100k to go to a job where you make $20k first year. Just ain't gonna happen like that. As much as I love flying, it can wait while I work and pay or save and pay.

Yup--keep in mind there is a credit melt down in the works--and of course there is a recession coming--oil going to $200/bbl.

[LoadMasterC141]

And of course the world is going to end this November too.

[GaTechKid]

Originally Posted by Pietrantonio

I noticed that everyone only talks about first year FO pay. It looked to me like pay increases every year, and when you upgrade to Captain, you get even more money. You can always factor that into your paying the loan back scenarios right?

No, you shouldn't factor a captain upgrade into your loan repayment scenario. Upgrading to captain is, for all intents and purposes, beyond your control.

I would plan on only having first officer pay to repay the loan for the first 5-8 years.

[mhcasey]

Originally Posted by ilove747s

What opportunities have you taken advantage of to save costs? Please share your ideas.

I know you've got a good full time job, so maybe not all of these will work, but here's some of the stuff I did:

1) Washed airplanes. George will give you an hour of flight time at least per wash. It took me around 5-6 hours to wash the flight club planes because the bottom was so freaking disgusting and I did a really good job. After the second time around it's much easier because you're not scraping bugs and oil that have been caked on there for months. You make pretty good money at your job, so do the math and if picking up an overtime shift would pay better, just do that instead.

2) Lucked out with some networking on JC. That got me a job at school that gave me a great discount, allowed me to sit in on other students' ground lessons, and got me a great safety pilot/friend (hope this isn't too sentimental Jason) to split time with later on. Don't let anyone tell you that safety pilot time is worthless. I wouldn't recommend 150 hours worth, but make it valuable and it will be. Don't just sit there level at 6000 all day.

3) Worked weekends at another school to get a discount.

4) Studied my butt off to cut down a bit on dual received. (Flight sim will also help you for your instrument rating). George and I did like 20 minutes of ground before my instrument checkride because I showed to him each time we flew that I had studied and knew what was up.

5) Found the best deals. You're in good shape right now man. Prices have gone up a bit since I started, but you can still keep it cheap around Austin. Plan ahead with your training. Plan to get your commercial AMEL and ASEL one week, then CFI the next. Make that 250 hours of "time building" productive.

6) I'm not multi talented, but I've seen guys get flight time in exchange for web services, advertising, etc.

I've caught some lucky breaks and been patient, but my training has been <25k through CFI, CFII, and Com. AMEL (no MEI yet, though I don't anticipate that being at all different from the com amel checkride). What others have said...work and fly and you'll be fine.