We have reached the goal. Now, what are the steps needed to complete the transaction?

How does the money change hands?
Following the completion of all items on the purchase offer, there are several ways for an exchange to take place.

1. All documents and money can be forwarded to the escrow agent, for filing with the FAA, and for disbursement per the seller's instructions, respectively. When all is properly completed the escrow agent will advise both parties.
   
   
2. An attorney, banker, consultant, aircraft sales professional, or the buyer and seller together can also handle the closing.
   
   
3. Money can be in the form of a Cashier's Check; however, it is subject to a "stop payment" order, which most people don't realize.
   
   
4. Money can be in the form of a Certified Check; however, this just means the funds were there when the check was drawn.
   
   
5. The best way to transfer funds is electronically! Each bank has its own "ABA routing number" and it only takes a few hours to assure the transfer. The buyer simply orders a wire transfer from his bank to the escrow agent's account per the escrow agent's instructions. The seller simply requests that his bank provide the escrow agent with a "payoff" and wiring instructions to that bank, who will forward the Lien Release, if any. The seller advises the escrow in writing of the total amount due and to whom the rest of the funds are to be disbursed. Typically, any consulting or brokerage fees will be wired to appropriate banks per instructions, and the balance will be wired to the seller, less the escrow fees.
   
   
6. In some cases, especially with first time buyer's, in order to facilitate the transaction, larger aircraft sales organizations can end up with the plane, the money and the Bill of Sale. This is not recommended. There have been cases where the same plane has been sold to two different customers. This is obvious fraud, but it can be avoided by exercising prudent judgement. Let the escrow agent handle the fiduciary responsibilities, or else, watch everything very carefully!
   
   
7. The escrow agent will advise all parties upon completion of the transaction. At this time the insurance company can be notified the purchase is complete, so they can begin coverage. If a "binder", as evidence of insurance, has not yet been received, this is the time to insist that it be faxed immediately!
   
   

As a final review, before you take physical possession of the plane from the seller, be sure that the following has been done:

1. Remove all of the seller's personal possessions, but nothing that is part of the plane.
   
   
2. Insure that all the logbooks, 337 Forms, Yellow Tags, AD Lists, wiring diagrams and any other maintenance history remains with the plane.
   
   
3. Insure that the required documents are on the plane:
   
   
   • Weight & Balance
   • Airworthiness Certificate
   • FAA Registration (temporary pink copy)
   • Operating Limitations and Markings (usually in Flight Manual or Pilot's Operating Handbook)
   • All covers, plugs, carpet runners, equipment bags, coffee pots, control locks and other "loose equipment" should remain with the plane.
4. In many cases, a maintenance test flight has to be taken to insure that everything is working. If not, a short acceptance flight is certainly worth consideration. It provides one last assurance to both parties that the plane is being transferred as agreed and removes any notion that the seller has any more responsibility. If some discrepancies are found, however, attach that list as an addendum to the "Delivery and Acceptance Form. Click here to review a sample form and download.

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Good Flying!

The Sky Guys