Financial Implications Explained
ATPL Finance offers tailored finance solutions specifically for modular commercial flight training. ATPL Finance has a number of affiliated flight schools that are approved for training with an unsecured loan, if your chosen school is not listed you can request for them to become affiliated with ATPL Finance. They also offer protection for the loan should you lose your medical or if the flight school ceases to trade.
Unfortunately for a lot of people, financing the flight training is the biggest obstacle to becoming a commercial airline pilot. There are now no UK airlines who offer full sponsorship, meaning the cost of flight training and sometimes the type rating is required to be paid by the student. In the case of an integrated course, this can be upwards of £80,000.
There are no banks that will lend this amount of money without security - usually in the form of a property. Therefore if like most people you are in a position where you need a bank loan to fund your flight training, you will either need to own a home with a value in excess of £150,000 (most banks will only lend up to around 60% of the value of the property) or be in a position where someone (usually your parents) are prepared to take out a loan on their property on your behalf. The risks associated with this are discussed in "Becoming an Airline Pilot".
Another option is to work in another profession with a high earning potential. Whilst working you save money to either fully fund your training or save a lump sum that can be topped up with an unsecured loan to pay for the deficit. This is obviously a long term commitment potentially taking in excess of ten years to save the required funds, depending on your salary. It will also be frustrating, but you can start your flight training knowing that you will be debt free when you finish which is a huge benefit.
Some people elect to do modular training in order to spread the financial expenditure over a period of time that suits them. Using this method, you do not need a lump sum of money and can fly when you can afford it. It's also a much cheaper option than integrated training.
The only cadet program that is able to provide financial assistance is the British Airways Future Flyer Program. Whilst the debt is still taken on by the cadet, successful applicants that are unable to secure a flight training loan will be eligible for British Airways to provide the security required to obtain the finances.
A Spanish bank called BBVA offers specific flight training loans. The key points (taken from the BBVA website) are as follows:
- Maximum amount: Full cost of the course plus living expenses if required.
- Minimum amount: £45,000
- Repayment period: Up to 10 years.
- Payment holiday: Up to 24 months. Interest will still be charged during this period
and will be added to the loan balance.
- For up to 24 months after your payment holiday, your monthly repayments can be
reduced by 25%. Interest will be charged on the unpaid monthly repayment amount
and will be added to the loan balance.
- Security will be required: We will require a first or second ranking charge or
mortgage over a property located in the UK to secure your loan. The maximum amount
we will lend is 60% of the value of the property (whether for a first or second ranking
charge). We do not offer unsecured lending for pilot training loans.
- Interest: Bank of England Base Rate (variable) plus 2.5% per annum.
