Private jet financing: how jet loans work

The short answer: most private jets are financed with a loan secured by the aircraft. AOPA Aviation Finance describes jet loans as needing 15% to 20% down when they're credit-based, or 30% to 40% when they're asset-based, amortized over 10 to 15 years with a five-year term and a balloon for the remaining balance. The rate is priced off public benchmarks plus a margin for you, the jet and the structure. Charter revenue from a leaseback can offset part of the cost of owning the jet.

CRAFT operates an all-Challenger fleet under FAA Part 135. Owners who are thinking about putting a jet on our certificate ask us these questions before they buy, so this guide answers them with sources.

How a jet loan works

A jet loan is a secured loan: the lender records a lien against the aircraft with the FAA, and because jets are covered by the Cape Town Convention, also registers its interest on the International Registry. You make monthly payments of principal and interest. Because jets are expensive and hold a lot of their value, lenders commonly separate two numbers:

• Amortization: the period the payment is calculated over, often 10 to 15 years, sometimes up to 20 for turbine aircraft.
• Term: how long the loan actually runs, often five years. At the end of the term the remaining balance (the balloon) is due, and most owners refinance, pay it off or sell.

A balloon keeps the payment down. It also means you will face the interest rates of the day when the term ends, and the jet's value then needs to support the balance. The aircraft loan calculator has a balloon field to model exactly this.

Credit-based vs asset-based jet loans

Source: AOPA Aviation Finance, exploring aircraft financing options for jet purchases, February 1, 2025.

Who lends on private jets

Jets are mostly financed by banks with aviation divisions, private banks (often for clients with wider relationships), specialist aviation lenders and aviation finance firms that work with several lenders. Manufacturers' finance arms support sales of their own new aircraft. Our aircraft lenders directory lists firms that advertise jet financing, with what each says it finances.

Rates for jets are rarely published. Where they are, they're starting rates for strong borrowers on newer aircraft. Our aircraft loan rates page tracks the benchmarks jet loans are priced from and the rates lenders do publish, each with its date.

What jet lenders look at

Beyond your finances, a jet lender underwrites the jet itself:

• Title, liens and registration, including the International Registry for jets and their engines.
• Records: logbooks, inspection status and airworthiness directive compliance. Gaps lower the value a lender lends against.
• Engine program: most turbine lenders require one, and enrollment makes a jet easier to finance and to sell.
• Value and age: lenders lend a share of an appraised value, and some set age limits.
• Use and base: Part 91 private use, Part 135 charter use, and where the jet is based and flies.
• Insurance: the lender named as loss payee with a lienholder's endorsement.

Each of these is explained in aircraft financing: what lenders check.

What a jet costs a month

A loan payment is one line of the monthly cost. The rest is operating the aircraft: crew, hangar, insurance, maintenance, engine reserves and fuel. Using the same example assumptions as our calculator (20% down, 15 years, the prime rate as an example rate, 200 flight hours a year):

Illustrations, not offers: 20% down, 15-year amortization at 7.00% (the U.S. bank prime rate, 7.00% on October 2, 2026 (Federal Reserve H.15), used only as an example rate). Example prices are the median of UseRadar's value data for each model; operating cost is our ownership cost model at 200 hours a year. Change any of it in the aircraft loan calculator.

For the full cost line by line, see each model's ownership cost page, which now shows this financing estimate too.

Tax and depreciation: what to ask your adviser

We're not tax advisers, and the rules depend on your facts. These are the points owners raise with their advisers, with the official sources:

• Bonus depreciation. The IRS says the 100% additional first-year depreciation is permanent for eligible property acquired after January 19, 2025 (Notice 2026-11).
• Listed property. IRS Publication 946 treats business aircraft as listed property. Accelerated depreciation requires meeting the qualified business use tests, determined flight by flight, and falling below them later means recapture.
• Entertainment use. Deductions for aircraft used for entertainment are limited under 26 CFR 1.274-10.
• Depreciation in the market. Tax depreciation is not market depreciation. See what jets actually lose in value in our private aviation depreciation rates.

Our leaseback page explains how these points apply when a jet is leased to a Part 135 operator for charter.

Offsetting the cost with charter

Fixed costs such as crew, training, hangar and insurance run whether the jet flies or not. One way owners spread them is a leaseback: the jet flies charter on an operator's Part 135 certificate between the owner's own trips, and the revenue goes toward its costs.

In a CRAFT leaseback, a Challenger 300 or 350 you own flies on our certificate. We carry crew, maintenance and compliance, you fly your own trips on it, and you can fly the rest of our Challenger fleet when your tail is in maintenance. If you're financing the jet, tell your lender about the leaseback at the start: they'll want to approve charter use and see the lease to the operator.

If you would rather not own at all, a Fleet Jet Card buys hours on our Challengers at published rates, with no aircraft, loan or lender involved.

Sources

• AOPA Aviation Finance, exploring aircraft financing options for jet purchases (February 1, 2025) and turbine and turboprop
• Textron Aviation, financing a private aircraft 101
• IRS, guidance on the additional first-year depreciation deduction (IR-2026-06, January 14, 2026) and Publication 946
• eCFR, 26 CFR 1.274-10
• FAA, Cape Town Treaty

All checked October 11, 2026.