Three brothers with no PPL considering purchasing a plane

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Airplane#4904

Filing Flight Plan
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Airplane#4904
Myself and my two brothers (and possibly one other partner) are wanting to get our PPL's. By suggestion of others and by my own math, it's cheaper to buy a plane rather than rent. We've got a what I believe is a reasonable budget.


I have a few questions to those who have done anything similar-

-How did you structure the so called "Flight club"?
Should a shared LLC own the aircraft?

-*My main concern* How should the insurance work? Each individual carry renters insurance and rent it from the LLC? That seems expensive. Can the LLC carry a policy that would cover all of us as students and our CFI?

-We've got a rough idea of how we'll charge by the hour/split maintenance, but I'd love to hear other people experiences.

Any and all advice would be greatly appreciate.
 
My first piece of advice is that learning ownership while learning to fly is a pretty steep learning curve.

My second piece of advice is structure it so an entity owns the plane and the ‘owners’ own a share of the entity. That way you don’t have to re-title the aircraft when someone wants to sell.

Find an insurer that would be willing to put four named insured student pilots on the policy; Parker Woodruff at Airspeed would be a guy to talk to about that. Then find a CFI that would be willing to work with all of you.
 
It's only cheaper if you actually sell the airplane after you get your licenses. Most people ignore the initial purchase price when running the rent vs buy numbers and just assume they will get most of it back when they sell. That only works if you actually sell. Also make sure you talk with an insurance broker. An airplane owned by three non pilots being used only for primary training isn't going to be cheap.
 
You might want to reach out to AOPA ,they can answer your questions and give some advice on forming a club.
 
Probably should all make sure you can pass the medical exam first, before committing to the Private license and aircraft purchase. You can fly under BasicMed but that still involves getting a clean bill of health.

Registering the plane in an LLC and getting an insurance policy to cover all of you as named insured shouldn't pose too much of a problem.
 
No way I'd buy an airplane before I soloed (which also implies getting your medical). I know multiple people who got that far and quit. Airplanes are expensive, lots of ways to go wrong on a first purchase, and used airplanes generally take much longer to sell than used cars, meaning the expenses keep piling up, even after you make the "sell" decision. I'd defer a purchase decision for the time being.
 
Silly me, I read the title and assumed you guys were just going to buy it and fly it…. Without licenses… :)
 
TCABM said:
My first piece of advice is that learning ownership while learning to fly is a pretty steep learning curve.

My second piece of advice is structure it so an entity owns the plane and the ‘owners’ own a share of the entity. That way you don’t have to re-title the aircraft when someone wants to sell.

Find an insurer that would be willing to put four named insured student pilots on the policy; Parker Woodruff at Airspeed would be a guy to talk to about that. Then find a CFI that would be willing to work with all of you.
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Thank you! Having our LLC own it seems to be the way everyone has advised. I didn't think about having to retitle it if one of us wanted out. thanks. I'll give Mr. Woodruff a google and reach out to him.
 
kmacht said:
It's only cheaper if you actually sell the airplane after you get your licenses. Most people ignore the initial purchase price when running the rent vs buy numbers and just assume they will get most of it back when they sell. That only works if you actually sell. Also make sure you talk with an insurance broker. An airplane owned by three non pilots being used only for primary training isn't going to be cheap.
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Valid point, we do intend on selling when we're done. I'm getting a few insurance quotes but it has seemed difficult to articulate our plan. I didn't think it was such a foreign idea. I thought someone else must have done something very similar.
 
kyleb said:
No way I'd buy an airplane before I soloed (which also implies getting your medical). I know multiple people who got that far and quit. Airplanes are expensive, lots of ways to go wrong on a first purchase, and used airplanes generally take much longer to sell than used cars, meaning the expenses keep piling up, even after you make the "sell" decision. I'd defer a purchase decision for the time being.
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Thanks for your input. So you'd advise we all get as far as a solo then consider purchase? Or just forgo the idea of buying until we've gotten our PPLs and enough experience to decide if we will fly enough to justify ownership? I actually have my commercial rotary from flying Blackhawks in the national guard. One brother has some hours and has soloed but never finished.
 
Charlie Golf said:
If they were all sovereign citizens...
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I knew a guy that owned an Arrow, no PPL, minimal training. Flew it in IMC … out of a field.

Fortunately, the plane was destroyed on the ground during a tornado. Of course, it was not insured…
 
SoonerAviator said:
Probably should all make sure you can pass the medical exam first, before committing to the Private license and aircraft purchase. You can fly under BasicMed but that still involves getting a clean bill of health.

Registering the plane in an LLC and getting an insurance policy to cover all of you as named insured shouldn't pose too much of a problem.
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That's a good point about the medical. I have one through flying for the Army and one of us has one from soloing last year. The other is fairly young and in good health but we will definitely have to look into getting him check out.
 
frfly172 said:
You might want to reach out to AOPA ,they can answer your questions and give some advice on forming a club.
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I joined today with intent to check out there forums but found they didn't have any! I will look further into it. How do I go about sending them a question?
 
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Option 1: Purchase the plane only for PPLs, then sell it. You may spend a lot of time/money fixing the plane, then selling it, and may or may not recoup the money (likely will).
Option 2 (far better): buy the last plane now, train in it, upgrade it, and enjoy it for a long time. Economical, safer, ...
I did option 2 (before my 1st lesson), and it was a great experience/journey.
Enjoy!
 
Airplane#4904 said:
-How did you structure the so called "Flight club"?
Should a shared LLC own the aircraft?
Click to expand...

That would be a common setup. You form a LLC or corp and the entity owns the aircraft.
Depending on the state you are in this can have positive or adverse tax implications as some localities tax business property different from personal property.

The alternative is for all three of you signing on the FAA transfer of ownership form. There are some downsides to that, mainly if one of you wants to get out of the deal you have to re-record ownership. If you buy through a LLC, you just sell the membership interest



Airplane#4904 said:
-*My main concern* How should the insurance work? Each individual carry renters insurance and rent it from the LLC? That seems expensive. Can the LLC carry a policy that would cover all of us as students and our CFI?
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Yes, that would be the normal thing. The insurance is written on the LLC but the three of you are listed as authorized pilots and the insurance coverage is extended to you.

If it is a standard trainer, your CFI is probably authorized as instructor without anything extra. If you bought a unusual aircraft to train in , the insurance may require your CFI to show that he has X hours in the type.



Airplane#4904 said:
-We've got a rough idea of how we'll charge by the hour/split maintenance, but I'd love to hear other people experiences.
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Many different ways to skin the cat.

Many partnerships spread the basic cost to hold the keys to the plane evenly across the members and then allocate the expense for 'each additional hour' based on a hourly basis (e.g engine reserve, prop reserve, fuel, an allowance for misc. wear parts lime air pumps, alternator and exhaust)
 
Being a pilot and flying sounds like a lot of fun. However, there is quite a difference between the idea of flying and the reality of being a pilot.

Besides the time, effort, and financial commitment, there is also the ability to make decisions under stress.

There is also the reality of learning to deal with fear.

Some of these things can make the reality of flying very different than the expectations. Some get to the point where they just choose not to do it. Some are unable to deal with the fear.

It doesn't matter how tough or strong you think you are, mentally it can be more than people want to deal with.

Some people are just not meant to be pilots, and there is nothing wrong with that.

Only mentioning this so your plan allows for one of your brothers to bail during the process. If this is included in your plan, then it won't end up causing a rift if it happens.
 
Guy is a Blackhawk driver, I think he has an idea of what he’s getting into on the flying side.
 
Airplane#4904 said:
I actually have my commercial rotary from flying Blackhawks in the national guard. One brother has some hours and has soloed but never finished.
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Way to bury the lede :biggrin:

I would normally echo the posters who say not to mix learning to fly with learning to be an owner, but I think you'll be fine with that level of experience. Be sure to have a hangar and maintenance figured out as well. Those are often the hardest issues there days. Not a bad idea to have the mechanic you will use for your annuals do the pre-buy so there's fewer surprises. Start building that relationship either way.

Yes on the LLC. I wish I had done that for my airplane I own by myself.
 
Airplane#4904 said:
Thanks for your input. So you'd advise we all get as far as a solo then consider purchase? Or just forgo the idea of buying until we've gotten our PPLs and enough experience to decide if we will fly enough to justify ownership? I actually have my commercial rotary from flying Blackhawks in the national guard. One brother has some hours and has soloed but never finished.
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I would get to the point where you know you're going to follow all the way through, finish the license, and actually use it. My $0.02.
 
Airplane#4904 said:
Thanks for your input. So you'd advise we all get as far as a solo then consider purchase? Or just forgo the idea of buying until we've gotten our PPLs and enough experience to decide if we will fly enough to justify ownership? I actually have my commercial rotary from flying Blackhawks in the national guard. One brother has some hours and has soloed but never finished.
Click to expand...

I’ll modify my advice a bit give two of the potential partners have some aviation experience.

I’d still rent my way thru PPL for a variety of reasons. One is that you likely will have a fast pass thru the PPL. The pre-solo guy has already quit once, so he’s not a known good partner yet, but he looks good on paper. The others….can any of them pass a physical? If yes, will they stick thru the frustrations of a 2 month process stretched across 9+ months due to weather and DPEs and life? If your partner group is tight and will cooperate and graduate, odds are okay on that.

Second, post-PPL, what does everyone envision the flying they do will be? If y’all are like minded, buy the best version of the plane that does that mission best. Cash up front, no financing. I’m in a partnership currently and we turn over a member a year on average and we require a PPL and current flight review to purchase a share.

Biggest reason a partner leaves is because they figured out the $3K/yr plus $85/hr dry is a time suck or expense they just can’t swing or justify any more. The partnership will be spending real money every month whether the plane moves or doesn’t and it’d suck to be stuck as a sole owner with a plane payment that was based on a four-way split.

I’m fairly conservative when it comes to ownership…I could be a sole owner but I’m not. I’ll likely join or form a second partnership on the next couple of years, but no sole ownership for me unless I build it.
 
Jim K said:
Way to bury the lede :biggrin:

I would normally echo the posters who say not to mix learning to fly with learning to be an owner, but I think you'll be fine with that level of experience. Be sure to have a hangar and maintenance figured out as well. Those are often the hardest issues there days. Not a bad idea to have the mechanic you will use for your annuals do the pre-buy so there's fewer surprises. Start building that relationship either way.

Yes on the LLC. I wish I had done that for my airplane I own by myself.
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Haha yeah I left that out semi intentionally. I didn’t want anyone thinking I’m more knowledgeable about general aviation than I am. I got my commercial the day I left fort Rucker and have done nothing but fly for the Army since.

I’ve spoken to a few mechanics willing to travel with us to do a prebuy and I’ve put the word out trying to find a more local guy to do our routine/annuals.

I’ve got a hangar being held at a small airport very close (next door) to where I live. It’s pretty rural though so finding a regular mechanic may be hard. But there’s plenty of other planes hangared there so they have to get maintained somehow.
 
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TCABM said:
I’ll modify my advice a bit give two of the potential partners have some aviation experience.

I’d still rent my way thru PPL for a variety of reasons. One is that you likely will have a fast pass thru the PPL. The pre-solo guy has already quit once, so he’s not a known good partner yet, but he looks good on paper. The others….can any of them pass a physical? If yes, will they stick thru the frustrations of a 2 month process stretched across 9+ months due to weather and DPEs and life? If your partner group is tight and will cooperate and graduate, odds are okay on that.

Second, post-PPL, what does everyone envision the flying they do will be? If y’all are like minded, buy the best version of the plane that does that mission best. Cash up front, no financing. I’m in a partnership currently and we turn over a member a year on average and we require a PPL and current flight review to purchase a share.

Biggest reason a partner leaves is because they figured out the $3K/yr plus $85/hr dry is a time suck or expense they just can’t swing or justify any more. The partnership will be spending real money every month whether the plane moves or doesn’t and it’d suck to be stuck as a sole owner with a plane payment that was based on a four-way split.

I’m fairly conservative when it comes to ownership…I could be a sole owner but I’m not. I’ll likely join or form a second partnership on the next couple of years, but no sole ownership for me unless I build it.
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Thank you for the reply, all very valid points. It’s a big, time consuming, financial risk not to be taken lightly.

We’ve had thorough discussions on everyone’s expectations and they seem reasonable. I stressed that the only way to justify this would be if each of us had a passion for aviation. A love of it. The notion of traveling by small plane for convenience or time saving is a bit of a pipe dream and we all will likely fly far less than we think we will post ppl mainly because of time.

All that said, it is worth noting I drill at a regional airport (more than once a month like a normal Guardsman. More like three to five times a month to meet our minimums) two and a half hours drive from where I live. But only 99 nm south as the crow flies.

To make the idea of a commuter plane even better, I share a property line with a small municipal airport where the manager is holding me a hangar.

So while I’m justifying buying the plane to cut the cost of three of us getting our PPL by selling it afterward, if the stars align and all goes well, I’ll keep the plane and commute with it. My brothers are aware of my ulterior motive and are ok with adjusting costs if I do in fact fly it as much as I’d like.
 
Airplane#4904 said:
Thank you for the reply, all very valid points. It’s a big, time consuming, financial risk not to be taken lightly.

We’ve had thorough discussions on everyone’s expectations and they seem reasonable. I stressed that the only way to justify this would be if each of us had a passion for aviation. A love of it. The notion of traveling by small plane for convenience or time saving is a bit of a pipe dream and we all will likely fly far less than we think we will post ppl mainly because of time.

All that said, it is worth noting I drill at a regional airport (more than once a month like a normal Guardsman. More like three to five times a month to meet our minimums) two and a half hours drive from where I live. But only 99 nm south as the crow flies.

To make the idea of a commuter plane even better, I share a property line with a small municipal airport where the manager is holding me a hangar.

So while I’m justifying buying the plane to cut the cost of three of us getting our PPL by selling it afterward, if the stars align and all goes well, I’ll keep the plane and commute with it. My brothers are aware of my ulterior motive and are ok with adjusting costs if I do in fact fly it as much as I’d like.
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MountainDude said:
Option 1: Purchase the plane only for PPLs, then sell it. You may spend a lot of time/money fixing the plane, then selling it, and may or may not recoup the money (likely will).
Option 2 (far better): buy the last plane now, train in it, upgrade it, and enjoy it for a long time. Economical, safer, ...
I did option 2 (before my 1st lesson), and it was a great experience/journey.
Enjoy!
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I like this guys attitude! Haha
 
Airplane#4904 said:
Thank you for the reply, all very valid points. It’s a big, time consuming, financial risk not to be taken lightly.

We’ve had thorough discussions on everyone’s expectations and they seem reasonable. I stressed that the only way to justify this would be if each of us had a passion for aviation. A love of it. The notion of traveling by small plane for convenience or time saving is a bit of a pipe dream and we all will likely fly far less than we think we will post ppl mainly because of time.

All that said, it is worth noting I drill at a regional airport (more than once a month like a normal Guardsman. More like three to five times a month to meet our minimums) two and a half hours drive from where I live. But only 99 nm south as the crow flies.

To make the idea of a commuter plane even better, I share a property line with a small municipal airport where the manager is holding me a hangar.

So while I’m justifying buying the plane to cut the cost of three of us getting our PPL by selling it afterward, if the stars align and all goes well, I’ll keep the plane and commute with it. My brothers are aware of my ulterior motive and are ok with adjusting costs if I do in fact fly it as much as I’d like.
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Costs are easy. Split the common fixed costs four ways. You want a separate hangar, you pay for that out of pocket.

Each person pays operating costs for each hour flown on a dry basis. Charge yourselves a realistic hourly cost that will ensure you have to money to OH the engine when it’s needed. This shakes out fairly based on use. AOPA has a worksheet to help with that.


Given your goal, I’d look for an IFR equipped plane because you’ll want the ability to get in/out of a benign layer for commuting.

I’ve got a decade+ worth of detailed financials for our 172 that I’d be willing to share to give you an idea of what that side looks like. Happy to share, PM me your email and I’ll send it this evening.
 
Airplane#4904 said:
The notion of traveling by small plane for convenience or time saving is a bit of a pipe dream and we all will likely fly far less than we think we will post ppl mainly because of time.
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My experience has been that
1) Your dispatch rate will be better than you think. Especially if you get your instrument rating. I've only had to scrub flights a few times, and all of those were completed by moving departure time +/- 1 day. If you have any flexibility at all a GA plane can be quite usable. Maintenance issues have been a bigger problem WRT not being able to go than weather. Consider getting a plane already set up for instrument work if you're going to commute, or at least adjust for the cost of upgrades.

2) Having your own plane generally causes you to fly more. You'll go on a whim on nice days (or in my case overcast days for instrument practice) when you don't have to deal with scheduling. I'm flying 150 hours a year on accident. I would probably fly more than that if I lived next door to the airport.
 
I would consider renting first, then buy a plane after you have soloed. Why? Flying may or may not be a good fit. You won't know for sure until you have a few hours in. If you have already bought a plane and find you want to stop,, you could potentially lose a lot more. After you solo your instruction time begins to multiply as you begin XC training. It is definitely less expensive to train XC in your own plane.
 
William Pete Hodges said:
I would consider renting first, then buy a plane after you have soloed. Why? Flying may or may not be a good fit. You won't know for sure until you have a few hours in. If you have already bought a plane and find you want to stop,, you could potentially lose a lot more. After you solo your instruction time begins to multiply as you begin XC training. It is definitely less expensive to train XC in your own plane.
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I think you need to read the thread.
 
Good discussion, depending on the eventual missions and sizes of each family, maybe an older Bonanza would be a decent option. Good examples around that aren’t tough to fly and are good travelers once your past training. Probably don’t want to have people in them their first 20 hours, but see if there is an abs instructor near you and discuss? Insurance will suck until everyone has a few hours in but you could ask insurance what experience level people need to get the rate to drop.


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Jim K said:
My experience has been that
1) Your dispatch rate will be better than you think. Especially if you get your instrument rating. I've only had to scrub flights a few times, and all of those were completed by moving departure time +/- 1 day. If you have any flexibility at all a GA plane can be quite usable. Maintenance issues have been a bigger problem WRT not being able to go than weather. Consider getting a plane already set up for instrument work if you're going to commute, or at least adjust for the cost of upgrades.

2) Having your own plane generally causes you to fly more. You'll go on a whim on nice days (or in my case overcast days for instrument practice) when you don't have to deal with scheduling. I'm flying 150 hours a year on accident. I would probably fly more than that if I lived next door to the airport.
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I hope so. My full time jobs in healthcare so my schedule is more conducive to spontaneous trips.


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TCABM said:
Costs are easy. Split the common fixed costs four ways. You want a separate hangar, you pay for that out of pocket.

Each person pays operating costs for each hour flown on a dry basis. Charge yourselves a realistic hourly cost that will ensure you have to money to OH the engine when it’s needed. This shakes out fairly based on use. AOPA has a worksheet to help with that.


Given your goal, I’d look for an IFR equipped plane because you’ll want the ability to get in/out of a benign layer for commuting.

I’ve got a decade+ worth of detailed financials for our 172 that I’d be willing to share to give you an idea of what that side looks like. Happy to share, PM me your email and I’ll send it this evening.
Click to expand...

I’d love any and all insight to cost of ownership. I’ll send a dm! Thank you


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MIFlyer said:
Good discussion, depending on the eventual missions and sizes of each family, maybe an older Bonanza would be a decent option. Good examples around that aren’t tough to fly and are good travelers once your past training. Probably don’t want to have people in them their first 20 hours, but see if there is an abs instructor near you and discuss? Insurance will suck until everyone has a few hours in but you could ask insurance what experience level people need to get the rate to drop.


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We’re looked into a lot of different options. We’d like to stay at or below $75,000 for the aircraft so we have a bit in reserve for unforeseen maintenance. We are all big guys (220ish lbs) and the cfi I have in mind is also 200+. So a sundowner has caught my eye. A little slow and higher burn rate than I wanted but seems like the best of both worlds for size/useful load and price.

There’s also a 175B with good time in the engine I would love but it’s in anchorage and we’re in Alabama.


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Airplane#4904 said:
Thanks for your input. So you'd advise we all get as far as a solo then consider purchase? Or just forgo the idea of buying until we've gotten our PPLs and enough experience to decide if we will fly enough to justify ownership? I actually have my commercial rotary from flying Blackhawks in the national guard. One brother has some hours and has soloed but never finished.
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Just noticed the helicopter part. You guys will be fine. No offense to the helicopter guys on here, but you guys are all a bit nuts, but also can certainly fly a fixed wing single.

My advice is just to have fun, and to figure out if you're all on the same page about what the avionics and maintenance of the plane will be like. Even as brothers, if one of you wants everything state of the art and another wants to save money and have steam gauges, you're going to have some arguments. As a guy with a brother I like a lot, suggest getting those arguments out of the way as much possible and hit some compromises before you buy. Then work the plan you come up with.
 
The other issue with buying and owning is that if there are any maintenance issues, you either have to rent or not fly.

And if renting, that may mean a different make and model versus what you own.
 
Something that just popped in my head, how much does it cost to register the plane? I just paid a big bill renewing tags and registering a new truck and got to thinking about the aircraft. What’s the cost of registration?


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Minimal, something like $5 with FAA. Each state is different on their registration requirements. In Iowa anything old as dirt like mine is $35.
 
Airplane#4904 said:
Something that just popped in my head, how much does it cost to register the plane? I just paid a big bill renewing tags and registering a new truck and got to thinking about the aircraft. What’s the cost of registration?


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FAA aircraft registration is good for 7 years and is pocket change. Each state has it’s own rules and you may not have a state requirement.

Now, if you form an LLC, your state likely has fees for that. The LLC will likely have to file a tax return as well.
 
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