Student loans plus aviation loans

Hello. My name is Dan. I am almost done graduating college in something different than aviation. I know this could be good because of the highs and lows of the aviation industry. My question is however, have any of you had student loans along with the flight training loans? If so, how did that work out? I have been looking into ATP for years and even visited the Trenton location. I see that many regionals offering tuition reimbursement which helps, plus sign on bonuses.

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How are the payments though while being a flight instructor?

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Coincidentally I am in the same situation as both of you, I have some student loans from my B.S. degree and I will definitely need the tuition & living expenses loan to attend the ATP program I’m targeting to start in January of 2017.

I’m giving myself (4) months before I start to payoff some credit card debt and save up some money before leaving my full time job and spend the first 6 months of 2017 as a full time student pilot. This being said if for whatever reason I’m unable to secure financing with Wells Fargo or Sallie Mae for tuition and living costs are my ATP flight school pursuits deflated? Is there an alternative or special financing options :smirk:

I may be unnecessarily concerned, but I think it’s valid and major concern in my mind.

For me the financing of the training is what has prevented me from starting flight school. I’m extremely adverse to debt and feel as if it makes me an indentured servant (I know, it’s hyperbole). But after saving for a while, I’m to the point were I can borrow about half of the cost of training and pay for the other half with cash. On top of that, after doing the math and comparing the two, instead of getting a student loan I’ve decided to refinance my house and take out some of the equity in cash. I realize this is not something everyone can do, but if you can, financially it’s a much better option. It will only raise my house payment by about $100 a month (compare that to a $500 or more a month student loan payment). As well, I plan on contributing what I would monthly on a student loan towards the principal on my house. This will result in me paying my house off way earlier even after I refinance it. I’ve also heard of people liquidating many if not most of their assets. Personally I feel if you can stay out of debt as much as possible, even if it requires eating ramen noodles and living with your Mom, it’s worth it in the long run (believe me, even just paying for 10% of your training with cash makes a difference). However, if it’s not an option and you have to go the student loan route, I would look at it as an investment and make it a goal to pay off that investment in half the time the bank will require you to pay it back.

Do you have any assets you can borrow against or liquidate, like a car or a roth IRA or a roth 401k you’ve had money in for more than five years or other types of investments? If you have a roth investment that is 5 yrs or older and you withdraw your contributions from it but not what you have earned, the government won’t hit you with the 10% penalty. As well, you may even be able to escape the 10% penalty and taxes for many types of investment if you use it for qualified education expenses. Don’t misconstrue that as financial advice, but rather as an option if it fits you best. Most of the time a financial advisor would tell you absolutely not to touch your retirement account because most people won’t put the money back and it stunts your earning potential. Just make sure you do your research and get solid advice from a professional before messing with your investments.

Hi Jack,

Thanks for the suggestions. I don’t have any investments I can liquidate, unfortunately. I did have a car I sold back in April in preparation of expediting my Aviation education and career, so that has already been done.

It looks like at this point my best bet will be to save as much as possible between now and January while I’m still working full time. As far as the student loan I’ll just need to make sure I pay down as much credit card debt as possible before the end of December when I plan to apply for the student loans. :sweat:

Thanks again for your suggestions.

I would point out that while no debt is great, it can be good if it increases your earning potential later. I took out a loan for the full amount of the program and was able to pay it off in half the time. It took a lot of hard work and sacrificing a few things here and there, but it was well worth it.

Also, I am making many times now what I would if I did not have my aviation education. So debt that is taken out to advance a career can be a really good thing.

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I really have to agree with Chis on this one. While debt is generally not a positive, I consider this more of an investment in your future. Not advocating fiscal irresponsibility nor am I trying to convince anyone to do anything you find “uncomfortable”. But life is short my friends and you can waste a whole lot of time waiting for everything to be perfect. Before you know it your ship has sailed (or plane has taken off if you prefer?). It was a scary prospect taking out that loan but the thought of never trying and spending my life wondering what if was scarier.

All said and done it was the best decision of my life and I’d do again anyday of the week and twice on Sunday.

Adam

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So was you able to manage quitting your job and completing the atp program. I’m kind of in the same boat as you.

Hi Daniel,

I was able to take a short break from working when I left my then current job and took about 3 months off before starting my new job.

As far as joining ATP is concerned, unfortunately once all was calculated the budget was not feasible for me personally. Fortunately I was able to make a significant uptick in flight time, during my 3 months off, at my current flight school and I’ve made a significant amount of progress.

Do any of you know if Sallie Mae or Wells Fargo will even give you a loan for ATP if you are already drowning in student loan debt??

Grant,

No one can tell you for certain other than the financial people as that’s what they do. That said simply by your statement that you’re “already drowning” I’m thinking not.

Adam

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Adam

I’m not drowning at all. I’m speaking theoretically if I do take out student loans. It just seems like taking out two 80k loans wouldn’t be allowed.

Grant,

Taking out two large loans can certainly cause issues, make sure to talk to the finance people in admissions before making any decisions in this area.

Chris

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Chris,

Thanks. Should I discuss it with ATP as well as Sallie Mae/Wells Fargo or just one or the other?

Grant,

I would discuss it with as many people as possible as these are significant financial decisions on your part.

Chris

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Do you believe one can survive with the average student loan (around 40k) and a full aviation loan from atp at the same time and while working as a flight instructor or pilot for the regionals? Say the person is okay with budgeting their annual expenditures and willing to make every ultimate sacrifice to become a pilot. Now also, what if the student has to get an additional loan for living expense during training and/or instructing, is it still possible?

Alex,

Absolutely. All of the mentors on here and well over a thousand ATP graduates per year survive just fine with the loan payments. Not only did I survive, I paid mine off in half the time.

Chris

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