Recently Funded - $750K Loan Secured by Private Aircraft - Commercial & Industrial Lending

A high net worth investor and developer refinances private aircraft

A Connecticut investor and owner of a private aircraft wanted to refinance an existing loan secured by a private jet.  His main relationship bank had no experience with loans secured by aircraft so the bank lending officer referred her client to Speritas Capital Partners.

After a nationwide search to find the best terms, Speritas Capital was able to identify a traditional regional lender with an established aircraft credit policy – unusual for traditional lenders. The combination of the borrower’s net worth, the aircraft lessee’s track record and the aircraft’s condition all factored into a positive underwriting decision.

This commercial and industrial loan was an all around win for the borrower, the relationship bank, and the new lender. The relationship bank was able to add value rather than just saying “no” and the new lender has a strong credit client.

Speritas Capital Partners helped an investor in the aircraft leasing business refinance a private jet.Commercial & Industrial Lending - Aircraft acquisition refinance

ABOUT THE LOAN

  • Loan Type: Commercial and Industrial Loan – secured by aircraft and underlying lease
  • Lender: Traditional lender with an established aircraft credit policy
  • Loan Amount: $750K
  • Term: 3 years / fixed rate

LOAN AMOUNT:
$750K

LOAN TYPE:
C AND I - AIRCRAFT

LOAN TERM:
3 YEARS

RATE:
FIXED

LENDER: BANK

CLOSED IN: ~90 DAYS

FINANCING OBSTACLES

The Challenge: The deal was complicated by the type of collateral (a Cessna Citation Bravo), the number of parties involved and the source of the loan repayment. A leasing structure would not work because the underlying lease payments would not be sufficient to cover the loan P&I payments. Traditional leasing companies and non-traditional lenders were quoting low to mid teens for the rate.

In addition, the borrower’s relationship banker wanted to help their client but also protect the client relationship. Speritas Capital’s CEO Jeff Bardos shared these goals. Speritas Capital works with traditional lenders to strengthen their clients by providing access to additional credit.

The approach:

  • Find a traditional lender with an appetite for a cash flow loan secured by a business jet and lease payments.
  • Negotiate loan terms that would match the remaining engine hours and the underlying lease.

The solution:

Speritas Capital was able to identify a traditional lender from our 70+ lender network – after a lot of digging. Once the right lender was found, Speritas Capital worked with the lender and the borrower to overcome unusual underwriting issues, such as matching the loan maturity and extension options to the jet lessee’s payments and to the remaining engine hours. 

An important part of this process was trusting that existing relationships would be respected by all parties. Speritas Capital is fortunate to work with some great financial partners that seek synergies and look out for the best interests of the borrowers.

CONCLUSION – POST FINANCE UPDATE

The borrower was able to refinance the private jet loan, extend the lease, and achieve a positive cash flow due to the competitive rate that Jeff at Speritas Capital found.  

This CT investor is now well positioned for the next three years.

The client writes...


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Jeff Bardos, CEO
Cathy Blood, Partner and Director of Marketing

The Speritas team brings our 30+ years of banking experience and our transparent, strategic approach to every client and every deal, both large and small.