LevelWing
Pre-takeoff checklist
I've found an aircraft that I might want to purchase and I want to put it through a pre-buy. The seller is going through a broker and it seemed as if the broker was on the up and up since he has a sales agreement, requires the money go through escrow and requires that a test flight be done to the potential buyer's satisfaction. I got the sales agreement and after taking a look at it I have some concerns.
First, the contract essentially reads that the aircraft will be purchased unless any un-airworthy items are found during pre-buy and the owner refuses to fix them. Further, this agreement states that the deposit will be placed into escrow and it is not refundable unless un-airworthy items are found. I was under the impression that if anything came back on pre-buy that the buyer wasn't satisfied with then the buyer could walk. My biggest concern with this is that I recently did a pre-buy on an aircraft that came back as being airworthy but it needed a significant amount of work and was only barely legally considered "airworthy".
The agreement also states which escrow company I will use. I'm not sure if this is common place or even a big deal, I just thought it odd that it was spelled out which escrow company I would have to use.
There are also time requirements placed on me, such as how much time I have to put the deposit into escrow, how long the pre-buy inspection is allowed to take (it's specifically stated) and how long I have to get the remaining funds into the escrow after the pre-buy inspection. The timelines shouldn't necessarily be a problem but there's no clauses in there that provide any exemptions so if something happened and the paperwork arrived a few days late because the finance company got behind, what then? One would hope the broker/seller would be understanding, but if it's in writing then I could lose my deposit.
What are some of your thoughts on this? Is this normal and I'm just reading way too much into it?
First, the contract essentially reads that the aircraft will be purchased unless any un-airworthy items are found during pre-buy and the owner refuses to fix them. Further, this agreement states that the deposit will be placed into escrow and it is not refundable unless un-airworthy items are found. I was under the impression that if anything came back on pre-buy that the buyer wasn't satisfied with then the buyer could walk. My biggest concern with this is that I recently did a pre-buy on an aircraft that came back as being airworthy but it needed a significant amount of work and was only barely legally considered "airworthy".
The agreement also states which escrow company I will use. I'm not sure if this is common place or even a big deal, I just thought it odd that it was spelled out which escrow company I would have to use.
There are also time requirements placed on me, such as how much time I have to put the deposit into escrow, how long the pre-buy inspection is allowed to take (it's specifically stated) and how long I have to get the remaining funds into the escrow after the pre-buy inspection. The timelines shouldn't necessarily be a problem but there's no clauses in there that provide any exemptions so if something happened and the paperwork arrived a few days late because the finance company got behind, what then? One would hope the broker/seller would be understanding, but if it's in writing then I could lose my deposit.
What are some of your thoughts on this? Is this normal and I'm just reading way too much into it?