Buying a plane from an Estate

ChemGuy

ChemGuy

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ChemGuy
Going to look at a Cherokee 140 from an estate in a couple days. Dont know a lot about it now. Supposed to have logs. Its in a hanger and last annual looks top be about 5-6 years ago. Registration is expired, but it looks like it can be 'renewed' for a few more months.

What would you need to transfer ownership? Just the heir at law transfer form? Anything else?

Can OKC tell me if the plane has any liens against it? How do I do that?
 
Order a title search from one of many services on-line. You’ll get all 337, liens, and ownership history that the FAA has on file.

The trustee can sell the airplane. It’s exactly the same transfer process for the buyer. You may want validation of the trustee. They’ll probably offer it.
 
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an estate purchase is the only time I've used escrow in a plane transaction, and they earned their $500 as they had to jockey with the estate attorney over a number of finer details, and they were able to make sure the plane would convey with no undue burden. Escrow made sure to prove who could sell the asset and got various proofs of same for me -- things I wouldn't even know to ask for.

I'd recommend "getting it right" by using escrow here. Estate law seems complex and you don't want some jilted heir coming after you for their piece of dear old uncle rutherford's aircraft.
 
schmookeeg said:
I'd recommend "getting it right" by using escrow here. Estate law seems complex and you don't want some jilted heir coming after you for their piece of dear old uncle rutherford's aircraft.
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Thanks for the recommendation and I also get this issue. But this plane is only going to be sold as is, where is...it seems the estate wants very little to do with it. I think pricing will be as if it was for parts.

I think they will help do paperwork to transfer ownership but that's about it.

I'll no more if I can actually lay hands on it next week.
 
Stewartb said:
Order a title search from one of many services on-line. You’ll get all 337, liens, and ownership history that the FAA has on file.

The trustee can sell the airplane. It’s exactly the same transfer process for the buyer. You may want validation of the trustee. They’ll probably offer it.
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+1 on lien‘s - I‘d guess many banks and owners don’t know the procedure for it to be released.
 
ChemGuy said:
Going to look at a Cherokee 140 from an estate in a couple days. Dont know a lot about it now. Supposed to have logs. Its in a hanger and last annual looks top be about 5-6 years ago. Registration is expired, but it looks like it can be 'renewed' for a few more months.

What would you need to transfer ownership? Just the heir at law transfer form? Anything else?

Can OKC tell me if the plane has any liens against it? How do I do that?
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Liens - if you received a document showing every transactions ever recorded about that airplane, would you understand what you are looking at? How about other breaks in the ownership chain.

So... a few years ago, someone came to me who bought an airplane from an estate. Just a handshake and what the Estate's lawyer (who did not understand how the FAA Registry works) thought would cover it. I was brought into the picture after multiple rejections about two years - yes, two years! - later and we finally got it fixed. Most estate transfers are not like that one, but the bottom line is, if there was an escrow, even that one would have been taken care before the closing two years earlier.

If you have to sk, "How do I do that?" you want the escrow/professional title assessment to locate problems and find solutions.
 
schmookeeg said:
I'd recommend "getting it right" by using escrow here. Estate law seems complex and you don't want some jilted heir coming after you for their piece of dear old uncle rutherford's aircraft.
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ChemGuy said:
Thanks for the recommendation and I also get this issue. But this plane is only going to be sold as is, where is...it seems the estate wants very little to do with it. I think pricing will be as if it was for parts.
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The fact that you think using an escrow service conflicts with the plane being sold "as is, where is" is a strong indicator that you should use an escrow service.
 
jesse said:
The fact that you think using an escrow service conflicts with the plane being sold "as is, where is" is a strong indicator that you should use an escrow service.
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My bad...I thought I added as is, where is auction. There wont be time for an escrow. That's why I am trying to get as much info as possible on what i can do to get clear title, if i buy it, before hand. It will probably sell for parts value but I will only try to buy it if I think I can make it airworthy without spending $$$$$. And if i run into an issue...into pieces it will go.
 
jesse said:
The fact that you think using an escrow service conflicts with the plane being sold "as is, where is" is a strong indicator that you should use an escrow service.
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Using escrow for the sale also isn't the same as getting title insurance. Which might be more useful.
 
Can you have an A&P look at it before you buy it at auction? Anything that has Sat for 5+ years is going to cost as much if not than the purchase price. Also, talk to the auctioneer about escrow anyways.
 
ChemGuy said:
My bad...I thought I added as is, where is auction. There wont be time for an escrow. That's why I am trying to get as much info as possible on what i can do to get clear title, if i buy it, before hand. It will probably sell for parts value but I will only try to buy it if I think I can make it airworthy without spending $$$$$. And if i run into an issue...into pieces it will go.
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Wow - 2 things here (1) make it air worth without spending $$$$ is likely a pipe dream. In the best or purchases there is always money that needs to be spent - ask anyone about their FIRST annual. (2) the issues related to the estate are serious and can really affect title and especially your ability to sell it later.

If your looking for cheap plane ownership this isn’t the best way to go. My .02 from the cheap seats


Sent from my iPhone using Tapatalk
 
I'll parrot what others have said here for escrow and title insurance. I used AIC in the past escrow and title insurance with one-stop shopping.
 
i Bought my fathers aircraft from the estate when he passed. It was in a trust, all I needed was the documents that spelled out who had control of the trust, a bill of sale with his name listed as deceased instead of owner, and a death certificate and the faa was happy. Get a title search if thats clean, get the documents from the estate and file bill of sale.
 
ChemGuy said:
My bad...I thought I added as is, where is auction. There wont be time for an escrow. That's why I am trying to get as much info as possible on what i can do to get clear title, if i buy it, before hand. It will probably sell for parts value but I will only try to buy it if I think I can make it airworthy without spending $$$$$. And if i run into an issue...into pieces it will go.
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these days, one can run a title by signing up at https://cares.faa.gov. But the potential problem of understanding what you are looking at remains. A lawyer familiar with it can help, so something like an AOPA plan subscription can be helpful, but most of these by far are done by aircraft title/escrow companies. i typically see only the problem ones where escrow was not used or escrow found a title issue they couldn't fix.
 
midlifeflyer said:
these days, one can run a title by signing up at https://cares.faa.gov. But the potential problem of understanding what you are looking at remains. A lawyer familiar with it can help, so something like an AOPA plan subscription can be helpful, but most of these by far are done by aircraft title/escrow companies. i typically see only the problem ones where escrow was not used or escrow found a title issue they couldn't fix.
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Thanks for that. I was able to trace its lineage back to Piper...only a few owners. 2 Liens recorded, both released. The last owner had it since 1990. Only 1 337 on file for adding 2 speakers under the panel in '81...pre headset times.

texasclouds said:
Yea, but does it have a nice paint job?
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Hard to say. only a couple pics so far in a dim hanger....and dust on it. But it doesnt look like a wreck.

It'll need a good annual, a good cleaning and some good luck. And ADSB in its future. And radios. And god only know what else. If i can see it ina couple days I'll know more.

Thanks for the help fellas.
 
It goes without saying - yet I'm saying it - that a plane sitting not being used is harder on it than hard use.
 
Well I bought it. FML.

I am trying to make sure we do the 8050-2 correctly. Everything I can find says this is how it should be. Can you experienced folks confirm this is how it should be? The plane was in single ownership and the heir who will sign has papers from the state of Michigan naming him "personal representative", their version of executor. I will include a copy of those with my application.

Pics will be posted later for all of you to laugh at me. :)

Thanks,

Estate BOS example.jpg
 
ChemGuy said:
Can you experienced folks confirm this is how it should be?
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Make sure John Smiths name and title are exactly how they are spelled out on the signed court document you get. Exactly. May even want to give a quick call to Oak City to see if "personal rep" is acceptable to their end. Call the local number vs the 1-800 number.
 
I have no experience with doing this on aircraft sales specifically, but I'd be inclined to list the seller as "Estate of John J. Smith." Because John J. Smith is dead and not selling you anything.
 
Bell206 said:
Make sure John Smiths name and title are exactly how they are spelled out on the signed court document you get. Exactly. May even want to give a quick call to Oak City to see if "personal rep" is acceptable to their end. Call the local number vs the 1-800 number.
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Do you have that number? I tried the toll free number and after a couple menus they said...sorry we are to busy to answer the phone. email us. and then the line clicked off.
 
Bell206 said:
FYI: I was told the seller's name (dead or alive) must match the records exactly and the person signing on their behalf must be the documented legal rep as noted in the guidance.
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That wouldn't surprise me. It also wouldn't surprise me if they want to signature to match the name, in which case Bob would ordinarily sign John's name "by Bob Smith as personal representative." But they might not want that either. Government agencies deviate from norms regularly. If there's guidance, definitely follow it on the first attempt.
 
OK. So after some more digging I found this in AFS 750-93

ESTATE. A conveyance executed on behalf of the estate of a deceased owner must be signed by the authorized representative of the estate and should be accompanied by that representative’s authority to sign for the estate, unless such authority is already on file with us. The name of the estate should be shown, followed by the representative’s signature and title; i.e., Estate of John Doe by Richard Roe, Executor. The representative’s name must be signed exactly as it appears on the authorization document.

29. EXECUTOR OR ADMINISTRATOR. A certified true copy of Letters Testamentary or Letters of Administration is required as authority for an executor or administrator to act.

So this part has me confused some...The name of the estate should be shown, followed by the representative’s signature and title; i.e., Estate of John Doe by Richard Roe, Executor. Is this what the signers title should be? Or is this confirming what Lindberg thought about the seller being The Estate of John J Smith vs using his name as it appears on the registration?

Who has actually filled one of these out from an estate and can calrify this please?

thanks,
 
I went and looked at what got filed by my escrow service. It was a 5 page monster with small type -- cover sheet, 2 pages with a court order naming who can transact, and the 2 page bill of sale + 8050-1 combo.

good luck.
 
Pay one of the title companies to make sure this is done correctly. Might be the best $500 you spend. … they are good and will make sure all the filings and information is correct.
 
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ChemGuy said:
OK. So after some more digging I found this in AFS 750-93

ESTATE. A conveyance executed on behalf of the estate of a deceased owner must be signed by the authorized representative of the estate and should be accompanied by that representative’s authority to sign for the estate, unless such authority is already on file with us. The name of the estate should be shown, followed by the representative’s signature and title; i.e., Estate of John Doe by Richard Roe, Executor. The representative’s name must be signed exactly as it appears on the authorization document.

29. EXECUTOR OR ADMINISTRATOR. A certified true copy of Letters Testamentary or Letters of Administration is required as authority for an executor or administrator to act.

So this part has me confused some...The name of the estate should be shown, followed by the representative’s signature and title; i.e., Estate of John Doe by Richard Roe, Executor. Is this what the signers title should be? Or is this confirming what Lindberg thought about the seller being The Estate of John J Smith vs using his name as it appears on the registration?

Who has actually filled one of these out from an estate and can calrify this please?

thanks,
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I have. Many months after someone who didn't know what they were doing tried several times to get it right because they preferred DIY to
Anthem said:
Pay one is the title companies to make sure this is done correctly. Might be the best $500 you spend. … they are good and will make sure all the filings and information is correct.
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ChemGuy said:
Who has actually filled one of these out from an estate and can calrify this please?
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Assisted with one about 6 months ago on a J3 in pieces for a friends widow. Filled it out as follows and had her discuss with oak city prior to sending. She also sent a true copy of her Letters Testamentary showing her as the legal executer of the estate via registered mail.

Seller:
John J. Smith

Signature:
Nancy Smith

Title:
Executor, Estate of John J Smith
 
Bell206 said:
Assisted with one about 6 months ago on a J3 in pieces for a friends widow. Filled it out as follows and had her discuss with oak city prior to sending. She also sent a true copy of her Letters Testamentary showing her as the legal executer of the estate via registered mail.

Seller:
John J. Smith

Signature:
Nancy Smith

Title:
Executor, Estate of John J Smith
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Perfect.

You are the man Bell 206. :cheers::cheers:
 
I suspect that they're going to choke when the seller's name and the seller's signature don't match, and the "Title" should be the title of the seller (i.e., "Owner"). I might have done something like:

SELLER:
John J. Smith​
​
SIGNATURE:
Nancy Smith, Executor for the Estate​
of John J. Smith​
​
TITLE:​
Owner​

But, like many here, I'm guessing. Also, like many here, I suggest you HIRE A PROFESSIONAL before this gets bogged down in a year's worth of red tape.
 
Dug mine up to PM to ya -- but it looks like escrow made my seller get a court order to transact on behalf of the estate since the plane was held in an LLC. Woof! Hope yours goes easier than that. :D
 
ChemGuy said:
Well I bought it. FML.
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Bill-Hader-Eating-Popcorn-Smiling-SNL.gif
 
i did it from a trust that the trustee was deceased. it was pretty simple. bill of sale exactly as the registration has it. title listed as deceased. they will require a certified death certificate and certified documents for the executor of the estate.
 
Bell206 said:
Assisted with one about 6 months ago on a J3 in pieces for a friends widow. Filled it out as follows and had her discuss with oak city prior to sending. She also sent a true copy of her Letters Testamentary showing her as the legal executer of the estate via registered mail.

Seller:
John J. Smith

Signature:
Nancy Smith

Title:
Executor, Estate of John J Smith
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Yes.

Half Fast said:
I suspect that they're going to choke when the seller's name and the seller's signature don't match, and the "Title" should be the title of the seller (i.e., "Owner"). I might have done something like:

SELLER:​
John J. Smith​
​
SIGNATURE:​
Nancy Smith, Executor for the Estate​
of John J. Smith​
​
TITLE:​
Owner​

But, like many here, I'm guessing. Also, like many here, I suggest you HIRE A PROFESSIONAL before this gets bogged down in a year's worth of red tape.
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No. See above.

Attaching copies of the Letters Testamentary or other legal documents as required to prove authority of the signatory is all that's needed.
 
schmookeeg said:
Dug mine up to PM to ya -- but it looks like escrow made my seller get a court order to transact on behalf of the estate since the plane was held in an LLC. Woof! Hope yours goes easier than that. :D
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That court order will be needed in many estate transfer situations. The registry needs to see documentation of authority to do the transfer.

Side note: a big part of the delay in registering is the number of times applications are kicked back for errors. Sometimes multiple times.
 
The FAA really needs a way to “assign on death” or to have a designated beneficiary.
 
DesertNomad said:
The FAA really needs a way to “assign on death” or to have a designated beneficiary.
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It might be nice to have something like a bank POD account but I don't think creating that kind of mechanism is the FAA's responsibility within a system that registers both Piper Cubs and 767s any more than it is for real estate or anything else. And even a POD would require documentary evidence of death, so you wouldn't be gaining that much. And I can guarantee people would screw it it up - that's 90% of the ones I get to see. There are plenty of options within the system. Co-ownership with survivorship. trust ownership with a beneficiary, family LLC.

These transfers are actually very simple. But it's a recording system very similar to real estate recording and the documentation has to be correct. Unlike real estate, the FAA actually takes an extra step - they reject recordings that are ineffective to transfer ownership instead of having it come up 20 years later. when nothing that isn't costly can be done. Someone who has their aircraft registered in a corporation but lists themselves personally as "owner" on a bill of sale which the buyer who doesn't know any better accepts is not the FAA's fault and should not be the FAA's problem.
 
I bought my 180 this way. Widow signed it and I sent it in, got a letter from the faa that said she wasn't authorized to sign it. She sent a document to the FAA and all was squared away.
 
midlifeflyer said:
Side note: a big part of the delay in registering is the number of times applications are kicked back for errors. Sometimes multiple times.
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Which is why I would use one of the OK City title/escrow services.

1) They know how to do things.
2) They walk the paperwork over and if something is wrong, it can be fixed NOW rather than 6 weeks later when the FAA letter reaches you.
 
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