Does it make sense to do a credit check on the seller of an aircraft? The reason I ask is because even a thorough pre buy doesn’t uncover everything you need to know. Virtually by definition, a broke owner will have neglected maintenance, which leads to surprises in the sorting out process. I’m wondering how much maintenance neglect is a choice, and how much it’s forced by circumstances…
Do you see people who could afford it ignoring required maintenance? I suspect it’s rather rare.
Well you should see what maintenance has been done in the logs. Plus, a thorough independent pre purchase inspection will unveil many issues.
Depends a little bit on the aircraft though. But as I have found, the competence of the mechanic is much more important than the financial situation of the operator.
When you say a credit check do you also mean a title check? Because I guess that’s a given especially with the high value items that the bank would like to keep a leash on when the seller defaults.
I have bought and sold aircraft from the states using AOPA escrow for that and for Germany I know that the LBA would know of liens on the aircraft. I am unclear about how other countries handle this but talk to @Flyer59 about the Cirrus he didn’t buy.
So yes a title check would be on my must-have-list of the prebuy
It is certainly a novel idea… the logic behind it is very good.
One warning I would give is that someone’s credit history can contain major errors, in the “bad” sense. The UK agencies (mainly Dun & Bradstreet and Experian) are notorious for cockups. For a private person they have to accept a phone call (from the subject person) to discuss it. For a company, they (Experian) charge £70 before they will communicate with you! You could easily get bad feedback on somebody who is actually OK. I have had one totally fake CCJ (county court judgement) registered against my company, via a “very interesting” process which ensured I never found out myself. Plus a major cockup by D&B led to problems; caused by companies below a certain turnover filing only abbreviated accounts so D&B make wild guesses on the status. And many planes are company owned. Even “little ones” sometimes; I recall seeing one homebuilt for sale at 100k+VAT and later going for 65k no VAT; the former was prob99 company owned.
Another issue is that there are loads of people who jump out of a perfectly cleaned and polished €100k car and jump into a totally shagged €15k plane. I would think their credit position is probably good. But you never know; it has never been as affordable to be a poser as it is today 
My son worked out he could buy a DB9 – they can be had for under 40k.
the competence of the mechanic is much more important than the financial situation of the operator.
Of course, but there are many scenarios where the operator can influence what is done and what is ignored. Especially a flying school. I have seen plenty of examples of that. The maintenance company doesn’t want to lose a big regular customer. And you have no way of checking the mechanic, really.
You would discover some fun stuff too. A friend of mine was looking for an Archer II. I don’t know why he was fixated on an Archer II but he was. He found one, 40k, parked outdoors for ~10 years without moving and so badly rusted that the oil filter rusted through. The owner was in jail… Also the prebuy (done by a guy I recommended) didn’t last long
So yes a title check would be on my must-have-list of the prebuy
I don’t think you can do a title check fully. For example unpaid airport fees.
While i had this incredible and bad experience with the “Cirrus i didn’t buy”, i would never try to look into a seller’s finances. It’s just none of my business. I personally find the idea strange. People who will not even give their own name in an internet forum recommend looking into other people’s finances?
I will rather pay for the best pre-purchase inspection.
Peter wrote:
And you have no way of checking the mechanic, really.
No, not checking the mechanic, but his influence is much bigger. That can happen to financial solid owners, too, who just deliver the aircraft together with a blanco cheque at the maintenance company and pick it up a week later. Just recently, I have done a pre purchase recently where an aircraft was just released one hour flight time ago with a broken alternator mount on the O-360. The engine was drowning in both WD40 and 15W50, the retractable gear had still the grease and grass from a couple of years ago. The owner just delivered the aircraft to the maintenance company and paid the bill. he was totally unaware of the condition of his aircraft.
Peter wrote:
I don’t think you can do a title check fully. For example unpaid airport fees.
@Flyer59 05-Dec-15 12:35 #05
“While i had this incredible and bad experience with the “Cirrus i didn’t buy”, i would never try to look into a seller’s finances. It’s just none of my business. I personally find the idea strange. People who will not even give their own name in an internet forum recommend looking into other people’s finances?
I will rather pay for the best pre-purchase inspection."
While I agree the idea is a little cheeky, you just don’t catch everything on the pre buy. As regards anonymity, by the time you’re buying, the seller knows who you are!
Just because “he knows who you are” doesn’t mean he likes you to investigate his finances :-)
I dislike that idea completely, and i am sure that a good pre-buy will discover all major problems.
@Flyer59
Probably most sellers wouldn’t like it at all. Agree with you there!
Regarding pre buy, I am not sure that you discover all major problems. I was told that airframe is clean and engine good. Both true (so far). But it is astonishing how much else in a plane can need repairing & you don’t really discover it until the annual is well under way.
I was posing the question in a provocative way: it seems to me that owners under financial stress cut corners. Owners not under financial stress are much more likely to lavish resources on their flying “mistresses”. I think the financial condition of the seller would be valuable information to have if there were a realistic way of getting it.
I would agree to a credit check if I were selling & the buyer explained why he wanted it.
I would not agree when i sell a plane as a private person.
I think that a specialist for the type will discover all expensive items. And if you don’t find anything and like the plane – would you then not buy it, because of a negative result of the financial check? I doubt it.
In my case there was nothing wrong with the SR22 i intended to buy. Nothing except that the seller was a criminal. But i only buy airplanes through a notary and he would have received the money only after the plane was registered on my name. I had the money, € 240.000, back in 4 days.
