Protecting Yourself Against Aircraft Repossession
Aircraft repossession is a reality that aircraft owners must recognize. Common reasons for repossession include default on loan payments, breach of contract, and bankruptcy. Once an aircraft has been identified for repossession, the legal process can be swift and ruthless. However, there are ways to avoid aircraft repossession and protect your investment.
Common Reasons For Aircraft Repossession
Aircraft repossession typically occurs when an aircraft owner defaults on their loan payments or breaches their contract. In some cases, bankruptcy can also lead to aircraft repossession. Another reason for repossession can be a violation of the terms and conditions of the loan agreement. This violation could include things like a change in ownership or an unapproved change in the use of the aircraft. Failure to maintain the aircraft to acceptable standards or to comply with regulatory requirements can also trigger repossession.
The Legal Process For Aircraft Repossession
The legal process for aircraft repossession can be complex and stressful. It usually involves the lender hiring a repossession agent to locate and seize the aircraft. The court will typically authorize the repossession agent to use various strategies to take possession of the plane.
Aircraft owners should know they have certain legal rights in the repossession process. For example, the repossession agent must provide notice of the repossession attempt and avoid breaching the peace. Additionally, aircraft owners may have legal remedies available to challenge the repossession or to seek compensation for any damage that occurred during the repossession.
How to Avoid Aircraft Repossession
Aircraft owners can take steps to avoid aircraft repossession. Maintaining timely payments and communicating with the lender are crucial. If an owner falls behind on payments, they should contact the lender as soon as possible to discuss their options. This may include negotiating a repayment plan or other alternatives to repossession.
Being aware of your legal rights as an aircraft owner is also useful. This includes understanding the terms and conditions of your loan agreement and any applicable state or federal laws. Aircraft owners that are aware of their rights and options are in a better position to protect their investments.
Protecting Your Aircraft through A Secured Transaction
Using a secured transaction is one way to protect your aircraft from repossession. A secured transaction is a legal agreement between the aircraft owner and the lender in which the plane is collateral for the loan. If the owner defaults on the loan, the lender has the right to take possession of the aircraft. This type of loan also offers several benefits, including lower interest rates and longer repayment periods.
For more information, contact an airplane repo attorney near you.