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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 09:57 
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I’m not a fan of getting an airplane in to prebuy and then using that as leverage. I make it very clear to our clients that we do not do that.


Sorry but what other purpose is there? You do a prebuy because the likelihood of finding problems is high. And you find a problem then that means money.

I'm pretty sure that what Erwin meant was that the buyer would use normal wear and tear, or common non-airworthiness issues as an excuse to haggle the price down.

If you come into the deal with the intention of paying the asking price minus any airworthy items not known at the time of the deal, then that's a fair price adjustment. If you come in at asking minus 10% and then want to take off for the chipped paint on the leading edges and oil on the struts, maybe your expectations are too high and you're wasting the seller's time.
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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 10:19 
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Yes, agree...

and to clarify and hopefully give some helpful advice...

The maintenance visit part of a prebuy shouldn't be to determine the condition of the aircraft or that it is as represented. If that's happening then a crucial step has been skipped and it's likely that both buyer and seller are going to be upset.

There should be a visual inspection and logbook review done prior to moving the airplane to the mechanical prebuy. This is the buyer's opportunity to determine if the aircraft is as represented. If it's not and the buyer wants to renegotiate the price, that is the appropriate time to do so, the seller isn't out anything, the buyer has made the investment to inspect the airplane or have someone inspect it for them. The seller shouldn't feel like their airplane is being held hostage and assuming the buyer's concerns are legitimate there's a good chance the seller will be open to discussing a lower price.

Yes, the assumption is that at prebuy the discrepancies found will be corrected at the expense of the seller. This is always a point of negotiation, it could be "all discrepancies" or just "airworthy discrepancies" and there may be a cap or and agreement that the seller will pay anything over $50k, etc.

Three things are required for a successful aircraft purchase;

A good airplane.

A good written agreement.

A good seller.

I guess I could say four, but the assumption is that we have a good buyer.

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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 10:24 
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Maybe the turbine world is more clearcut but it’s trivial on almost any piston prebuy to come up with arguable airworthiness items worth 25% or more of the sale price. Items the sellers mechanic has signed off multiple times and that the buyer would probably argue about with his mechanic at the next annual. And do you repair it or replace it, etc. “repair airworthiness items” sounds objective but it’s nooooowhere near that in the piston world


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 Post subject: Re: QUIT buying (turbine) airplanes without a PREBUY!
PostPosted: 03 May 2021, 11:13 
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Username Protected wrote:
Maybe the turbine world is more clearcut but it’s trivial on almost any piston prebuy to come up with arguable airworthiness items worth 25% or more of the sale price. Items the sellers mechanic has signed off multiple times and that the buyer would probably argue about with his mechanic at the next annual. And do you repair it or replace it, etc. “repair airworthiness items” sounds objective but it’s nooooowhere near that in the piston world


Yes, sorry... $50k is in the turbine world.

I probably should have included turbine in the title of this thread. I haven't been involved in piston aircraft in years and I'm totally unqualified to speak to them or how things work!

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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 11:19 
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It’s not the absolute amount so much as the discretion involved

The prebuy mechanic says the flap tracks are out of spec and they need to be replaced with a new part that’s $4000 each side, and a three month lead time. So you ask for $8000 off and hope you can find used serviceable but of course serviceable is just TLAR anyway and another mechanic will be fine with the flap tracks as they are.

Piston prebuys are a mess and I understand why sellers and even buyers might avoid them.


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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 12:27 
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One problem is that there is a wide range of things mechanics will sign off.

On planes I've bought with signed off annuals, once I got them to my mechanic I've found:

unservicable engine mounts

Cracked flap supports

fuel pump leaking fuel

cylinders with very low compression measure as near perfect a few flight hours earlier (3x cylinders)

Leaking brake master cylinder

Badly calibrated ASI signed off as calibrated

The list is long. There are sadly mechanics out there who will sign off anything. No way to know when you are dealing with a plane that has been worked on by someone like that. A pre-buy is a way to see if the log books accuratly represent the condition of the aircraft as represented in the log books.


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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 12:35 
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How does a seller prevent the possibility of their airplane being in pieces, at an airport away from home, and the buyer walking?

For whatever reason... mechanical or paperwork discrepancy, cold feet, whatever.

Now your plane is in pieces, away from home, and the shop requests you pay to get your airplane back?

I think this scares a few buyers.

Are pre-buys paid upfront?


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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 13:18 
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Username Protected wrote:
How does a seller prevent the possibility of their airplane being in pieces, at an airport away from home, and the buyer walking?

For whatever reason... mechanical or paperwork discrepancy, cold feet, whatever.

Now your plane is in pieces, away from home, and the shop requests you pay to get your airplane back?

I think this scares a few buyers.

Are pre-buys paid upfront?


Depends on the shop. We charge for the inspection labor up front, if we're doing a "prebuy".

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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 13:26 
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Username Protected wrote:
How does a seller prevent the possibility of their airplane being in pieces, at an airport away from home, and the buyer walking?

For whatever reason... mechanical or paperwork discrepancy, cold feet, whatever.

Now your plane is in pieces, away from home, and the shop requests you pay to get your airplane back?

I think this scares a few buyers.

Are pre-buys paid upfront?


I can only speak to normal turbine deals / prebuys, but yes the buyer pays for the prebuy upfront.

If the seller disagrees with the shop or the buyer is being unreasonable, the seller's remedy is to have the airplane put back together and moved (on a ferry permit) to another maintenance facility to have the repairs done.

In the six years since I started Jet Acquisitions we have only had this happen once, it was on an E90 and the facility doing the prebuy determined that the Containment Ring AD on the -28 engines had not been complied with. The quote to have Dallas Airmotive do the AD was $30k and the seller and buyer agreed to move the airplane to another facility that could do the engine work in-house and were able to repair everything for about what the engine repairs would have cost.

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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 13:55 
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The risk of the pre-buy inspection grounding a plane (possibly without good cause) is also real.

Its a serious issue and I don't see a good solution. If all mechanics were both skilled and trustworthy, it would be fine, but some are not, and that can result in a situation where a pre-buy grounds an airplane that the owners local shop has signed off as airworthy. (and can be the fault of either mechanic).


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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 14:08 
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Username Protected wrote:
The risk of the pre-buy inspection grounding a plane (possibly without good cause) is also real.

Its a serious issue and I don't see a good solution. If all mechanics were both skilled and trustworthy, it would be fine, but some are not, and that can result in a situation where a pre-buy grounds an airplane that the owners local shop has signed off as airworthy. (and can be the fault of either mechanic).


As long as there are no safety of flight issues you should be able to move the airplane on a ferry permit to have someone else return it to service.

There needs to be an understanding upfront of what that might look like as the maintenance shop could make things difficult for the seller, lack of cooperation with the new mechanic getting the ferry permit and a big ugly log entry saying the airplane isn't airworthy are but two concerns.

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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 14:10 
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"Fresh annual with sale!" <-- as a buyer this should set your radar off. Ideally the annual is close to expiration and you can just do the prebuy as an annual / phase I-V

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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 14:12 
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Username Protected wrote:
The risk of the pre-buy inspection grounding a plane (possibly without good cause) is also real.

Its a serious issue and I don't see a good solution. If all mechanics were both skilled and trustworthy, it would be fine, but some are not, and that can result in a situation where a pre-buy grounds an airplane that the owners local shop has signed off as airworthy. (and can be the fault of either mechanic).


Most importantly, it is grounded away from home and at a shop the owner doesn’t have a relationship with.

If I am selling and have two buyers, the one who is willing to accept more risk as a buyer, and not put the risk on me, is going to get priority. It has nothing to do with being nefarious or hiding anything. It’s just taking the path of least resistance and minimal headaches towards a fast close.

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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 15:31 
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How does a seller prevent the possibility of their airplane being in pieces, at an airport away from home, and the buyer walking?

That is what the deposit is for.

Your deposit should cover the cost of everything that may happen to you if the buyer walks, including they left your plane in pieces with some mechanic.

I would let someone do a prebuy on my plane only if:

1. The put down a deposit big enough to cover my costs should the deal fall apart.

2. I have interviewed the mechanic doing the prebuy and found them competent and respected.

3. The buyer has prepaid the mechanic for the prebuy labor and expected expenses.

4. The purchase agreement only requires that I fix airworthiness issues.

5. The prebuy is not so far away as to be an undue burden on me should the plane get stuck there.

The real risk in a prebuy is that something serious is found which grounds the airplane. In a way, this is good to know since your safety was in jeopardy. In another way, it means the plane is stuck somewhere which limits your ability to choose which shop does the work. There are options using a ferry permit to fix that, however, depending on the seriousness of the issue.

I recall having a prebuy done on a Piper Comanche I was considering. The oil filter had chunks of metal in it, clearly from internal engine parts, probably a bearing. I told the seller that the airplane in unairworthy, the mechanics showed them the metal. I wasn't into buying a project, so I said no on any adjustment, this was too serious to proceed.

They asked the mechanic to put the plane back together and they flew it home. The mechanic tried to reason with them, but it isn't his call to make. They made it home, but I was sure glad not to have bought that airplane.

Mike C.

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 Post subject: Re: QUIT buying airplanes without a PREBUY!
PostPosted: 03 May 2021, 15:34 
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Username Protected wrote:
"Fresh annual with sale!" <-- as a buyer this should set your radar off.

Not necessarily.

I am about to sell my MU2, but first it is going into inspections at the end of the month. So it will be sold with "fresh inspections". I want to find anything and fix it under my control rather than have it discovered in a prebuy. I'm not trying to fool anyone.

The key to whether "fresh inspections" are an issue is all about the reputation of the shop doing it.

Mike C.

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