The Ultimate Guide to Helicopter Financing

Helicopters are unique assets that offer unparalleled mission flexibility, from private transport to heavy-lift operations. This unique capability also means that helicopter financing has its own set of rules and lender considerations compared to fixed-wing aircraft.

Why Helicopter Financing is Different

Lenders approach helicopter loans with a different perspective due to several factors:

• Higher Maintenance Costs: Rotary-wing aircraft generally have more complex and costly maintenance requirements, including life-limited components. Lenders will scrutinize maintenance records and reserves.
• Diverse Use Cases: Helicopters are used in everything from tourism and ENG (Electronic News Gathering) to emergency services and corporate transport. The intended use heavily influences the lender's risk assessment.
• Value Fluctuation: Helicopter values can be more volatile based on market demand for specific mission types.

What Lenders Require for a Helicopter Loan

When underwriting a helicopter loan, lenders focus on the "Three C's":

1. Credit: A strong credit history and solid financial standing for the borrower are essential.
2. Collateral: The specific make, model, age, and condition of the helicopter. A thorough appraisal and pre-buy inspection are mandatory.
3. Character: The borrower's experience in aviation and business. For commercial operators, a solid business plan is required.

Financing for Private vs. Commercial Operations

The financing structure changes significantly based on use. For a private owner, the loan is based on personal credit and financials. For a commercial Part 135 operator, the loan is a business transaction. Lenders will require detailed business plans, revenue projections, and operational budgets to ensure the aircraft can generate enough income to service the debt. We have experience structuring loans for both scenarios across popular models from Robinson, Bell, Airbus, and Leonardo.