Public Commentary: The guidance below outlines FG Capital Advisors’ approach to asset-based lending for aviation finance. It is provided for information only and does not represent a solicitation.
Asset-Based Lending for Aircraft Finance: Secure Fleet Funding with ABL Solutions
Aircraft and related equipment represent high-quality collateral that lenders can advance against. Asset-based lending (ABL) converts these assets into working capital for acquisition, maintenance or lease payments. FG Capital Advisors designs and sources ABL facilities that match your fleet needs and funding timetable.
Eligibility & Collateral Criteria
| Criterion | Minimum Standard |
|---|---|
| Asset Age | Aircraft ≤ 15 years (with recent heavy maintenance) |
| Appraisal Value | Certified fair market value by approved appraiser |
| Registration & Title | Clear title with valid airworthiness certificates |
| Maintenance Status | Up-to-date records, no open deficiencies |
| Spare Parts & Equipment | Controlled inventory with serial-number tracking |
Loan Structures & Advance Rates
- Revolving Credit Facility: Ongoing advances up to 75% of appraised value.
- Term Loan: Lump-sum funding for acquisitions, amortised over 3–7 years.
- Sale-Leaseback: Sale of aircraft to funder and leaseback to operator; LTV up to 80% of net present value of leases.
- Spare Inventory Financing: Advances against spare engines, landing gear and parts with serial tracking.
Underwriting Focus Areas
- Appraisal Review: Third-party technical valuation of airframe and engines.
- Insurance Wrap: Hull and liability policies endorsed in favour of lender.
- Lease & Contract Analysis: Assessment of lease terms and counterparty credit.
- Repossession Procedures: Legal opinion on cross-border enforcement of security.
- Maintenance Reserve Testing: Cash flows earmarked for upcoming check cycles.
Indicative Pricing & Key Terms
| Term | Typical Range |
|---|---|
| Spread over SOFR | + 225–350 bps |
| Upfront Fee | 0.50–1.00% of facility size |
| Tenor | 3–7 years (aligned to maintenance schedule) |
| Covenants | LTV triggers, maintenance reserve requirements |
Process & Timeline (4–6 Weeks)
- Week 1: Mandate and initial asset appraisal.
- Week 2: Data-room setup with airworthiness and maintenance records.
- Weeks 3–4: Underwriting due diligence, legal review of title and liens.
- Week 5: Term sheet negotiation and credit committee approval.
- Week 6: Document signing, funding and collateral perfection.
Why FG Capital Advisors
- Partner-led service with aviation finance focus.
- Network of private-credit funds and specialty lenders.
- Experience in cross-border security and lease structures.
- Speed of execution, from mandate to draw in under six weeks.
- Rigorous risk checks on appraisal, insurance and repossession.
Engagement
Operators and lessors seeking asset-based lending solutions for aircraft acquisitions or maintenance funding may contact FG Capital Advisors. Our team crafts tailored ABL programs that unlock capital against your fleet.
This document is for informational purposes only and does not constitute investment advice or an offer to buy or sell any security or service. Independent professional advice is recommended before acting on any information herein.
