Tip 16 – Tips For Buying a Cessna 310 – Or Another Twin Cessna Part III Go For It
By: Jerry Temple
Phone: (972) 712-7302 Fax: (972) 712-7303
Published in Cessna Owners Magazine Dec 1999
Part One of this three part series discussed the various 310 models, key systems, options, equipment and cosmetics. Part Two addressed some of the realities that a buyer needs to look into and understand before beginning to shop. In this Part Three, I’ll discuss, in hopefully a logical sequence, subjects and actions that are critical elements of a proper acquisition.
At this point, I must advise that an in-depth discussion of the “search to find the right aircraft and the actual steps of a 310 Pre-Purchase Inspection must be left to another time and place. Each is a complex subject. Therefore, I’ll leave out the weeks/months that may have been invested in locating what is thought to be the right aircraft and skip to the point where we think we wish to purchase an airplane.
As instructed in Part Two, you’ve contacted your insurance agent and confirmed that you can obtain insurance for the type of aircraft you’re seeking. In addition, you have an estimate based upon the likely cost/value of the unit you hope to find and know the training requirements.
It is now wise to contact various training persons and firms to discuss costs, scheduling and logistics.
If you are going to obtain your Multi-Engine rating in the 310 you purchase, or as is often the case have the rating, but only 10 -20 hours in a Piper Seminole, Beech Duchess or other trainer twin then you’ll likely have a 15 – 25 hour dual requirement before being allowed to carry passengers.
Needless to say, your insurance firm, you and your family and the FAA want your 310, or other twin Cessna training, conducted by a well qualified instructor. Regardless if the training is for your initial Multi-Engine rating, or is type transition training, confirm the instructor’s qualifications and experience. Do not train at any school, or with any instructor, that feels that all twin Cessnas are the same. If you hear “it’s just another twin Cessna,” go elsewhere.
In-aircraft flight training is offered by Wisconsin based Neil Meyer (800) 642-8016 and Ron Cox (ATM) in Vero Beach, FL. (561) 778-78 15. Ron has his own 310I and both Neil and Ron will come to you.
If obtaining your Multi-Engine instrument rating is in your plans, there are three firms that offer twin Cessna procedures trainer/simulator training. SimCom is located in Orlando, FL. and Scottsdale, AZ. Flight Safety offers their twin Cessna courses at Long Beach, CA. and Wichita, KS. Recurrent Training Center is located in Urbana, IL. Teaming up with an actual partner or another twin Cessna owner is simply smart. You’ll agree after Day One of the simulator course.
Before any training is begun, or for that matter, as part of your research to confirm that a 310 is the right aircraft for you, the reading of AOPA’s Cessna 310 Safety Review is a must. It’s available from AOPA or through Sporty’s. Cessna 310 Accident Data is discussed and it has an excellent 310 training outline.
With your having a thorough understanding of required and optional training, training resources and costs, you and/or your acquisition consultant can conduct the aircraft search with minimum training questions.
Let’s assume that you saw the classified ad in Trade-A-Plane, The Controller or other aviation publication. Perhaps the seller, especially a dealer or broker, may also have information about the aircraft and photos on a web site. Most of the Aircraft For Sale publications, Re: Trade-A- Plane and The Controller, provide advertisers with Internet ads.
At this point who actually owns the airplane is not important. You’ve begun the research phase and a professional broker representing an aircraft will more often than not have answers to your initial questions. Before making the first telephone call, list your initial questions. Double-check the ad and any Internet information. Some of the answers you seek may already be supplied. Know which aircraft you’re calling about. A dealer/broker may have more than one 310.
Leaving a message requesting a fax of the specs on “the 310” may not get you what you want. If you simply want a spec list, simply send a fax requesting this. Professionals will respond. However, failing to give a name and a telephone number in a voice message, fax, or e-mail may not get a response. It’s called courtesy.
If you desire to purchase an aircraft from a private party you may find your attempts to obtain information about an aircraft challenging. Some individuals only return calls evenings or weekends. Some travel extensively but do not consider their schedules before placing ads. Many will fail to cancel an ad after a sale is made and simply do not respond to inquiries. Many will know finite details about their aircraft. Others will know surprisingly little. You may find that getting a spec list taxed and having photos sent is not so easy. Many computer literate sellers do not realize that many serious callers are not “on-line.” Few dealers and brokers will be unprepared to respond to legitimate requests, and if they’re not prepared, become cautious.
You may receive Spec Lists that have no N number or Serial Number. Do not let this overly concern you. Though an actual owner or dealer will likely place these on a Spec List, some brokers, including JTA, Inc., do not. You can think the worst, i.e., phony aircraft or it is not a contracted listing, however it is usually a matter of an owner not wishing to be involved in any way, or at a minimum, in the marketing and administration of a transaction. Put another way, they hired a broker because they do not wish to receive calls from buyers at 7:00 A.M. on a Sunday morning inquiring about the annual date.
If you’re selling an airplane similar to an advertised unit and are trying to determine what price you should ask, just be honest. Again, most pros will “chat” with you. An exchange of spec lists is wise. A dealer/broker may sell the aircraft he’s advertising and have other qualified prospects. For a fair commission, your planned, or on-going, efforts can have a quick and pleasant end.
Reasonable inquiries on initial communications include questions such as: annual date, weights, damage history (See Tips For Buying A 310 Part Two COO 11/99), missing logbooks (See Tips For Buying A 310 Part Two COO 11/99), date of last painting and interior and present condition of cosmetics, owned or brokered, aircraft’s current location, known discrepancies, an aircraft’s geographic history to include foreign registration and foreign language logbooks.
Specific technical questions such as compliance/status of a certain Airworthiness Directive or Service Bulletins, cylinder compressions, oxygen bottle hydrostatic inspection date may not be available at this time. Faxing a detailed questionnaire to the seller is premature at this time. Do not expect questions and research that normally comes under the banner of a Pre-Purchase Inspection to be addressed over the phone.
Be fully prepared to purchase a Chain of Title, which will show all previously registered owners. Unfortunately, some transactions may be in order, but without dates since the FAA accepts Bills of Sales without dates.
If you have evolved to the point where, based upon all of the information you have about the aircraft, that you wish to purchase it, with certain contingencies, then a formal Offer to Purchase should be submitted. Most dealer/brokers have such a form that they use for both the sale and purchase of an aircraft. The Offer to Purchase is not a final Purchase Agreement, but serves as the rules for the acquisition. It identifies the Seller, Purchaser and all brokers. The offered price and deposit are confirmed. All buyer contingencies are listed. These typically include an evaluation flight and Pre-Purchase Inspection satisfactory to the purchaser and that all applicable AD’s are complied with. In addition, the escrow agent, when used, is identified along with the agent’s bank wiring instructions. The escrow fee is often stated, or is often the case, simply who pays it is identified. At the light twin level of general aviation, it is common for the purchaser and seller to split the escrow fee. Smart money. Each party is protected.
The conditions of the return of the deposit are detailed. The location of the shop that is to conduct the Pre-Purchase Inspection and acknowledgment that the purchaser pays for this is standard. However, the location of a Pre-Purchase Inspection is a negotiated item and often is not included in an Offer to Purchase. More on the Pre-Purchase Inspection later. The offer should have an expiration. Normally, a couple of weekdays is common.
In reality, few offers come without notice. Purchasers are talking to sellers, dealers and brokers and verbal agreements are put into writing – the Offer to Purchase. The seller, be he an individual or dealer, or a seller and his broker review the written offer. Again, the money and terms were expected. However, watch for the “small,” last minute add-on condition that might not be so minor to you. Perhaps, the purchase price and other conditions were not verbally agreed to. Perhaps the purchaser was told to make an offer. The majority of twin Cessna customers prefer the seller have a price, asking, firm or otherwise.
If an offer is rejected for amount offered then the research conducted perhaps weeks/months ago will now pay off. Being able to make your case, or if need be, knowing when to walk away from an airplane rewards the study and knowledge on the buyers side.
Once the sale price and all conditions are agreed to, a signed Acceptance of the Offer is sent to the purchaser/purchaser’s agent. At this time, an agreed to deposit, usually 5 -10 per cent of the sale price, is wired to an escrow agent. This is the proper way to buy an aircraft. Do not send the deposit to the seller or seller’s broker. If the selling party will not consider your deposit with an Aviation Title and Escrow fu-rn as acceptable, go elsewhere. You’re asking for trouble. The escrow agent will inform all parties of receipt of the deposit.
At this point most aircraft transactions happen quickly. An inspection takes place in the next week or two and the aircraft is either purchased or rejected. Most sales are not tied to complex real estate deals, estates, stocks, etc. In addition, discrepancies discovered on a test flight or in a Pre-Purchase Inspection are usually resolved quickly with a repair or price concession, which keeps the transaction moving. Therefore, no complex escrow agreement is needed. Most twin Cessna sales will not be “in escrow” for months. However, if a sale does involve several actions that could require several weeks or months to complete, then a formal Escrow Agreement signed by both purchaser and seller would be in order. This article is not about escrow, so we’ll keep it simple. RULE – Do use an escrow agent to hold deposits and handle all funding. The buyer controls his deposit and when ready, authorizes full funding.
At the light twin level of general aviation, the rule of thumb is the buyer goes to the aircraft for inspections. It goes without saying that most purchasers state that they’ll want their mechanic to inspect it. Confidence and loyalty are respected and appreciated, but a twin Cessna will not likely be flown hundreds of miles for an inspection.
If true costs are considered it will cost less to fly a mechanic a long distance to the aircraft. However, in the real world of maintenance, few mechanics can leave their businesses for a day or two or let one or two mechanics go for this length of time. Most shops would not allow a “visiting” mechanic to work on the premises without one of the shop’s mechanics assisting. Most likely, a shop would simply agree to use its people for an inspection with your mechanic closely observing. Obviously, if the aircraft is based in a small town with one shop that has worked on the aircraft, then it must, of course, go elsewhere. If an aircraft is based in a large metroplex area i.e., Dallas, Los Angeles, Chicago then the odds are strong that a shop qualified to conduct a good Pre-Purchase Inspection is nearby. Bear in mind that in 45 minutes to one hour a twin Cessna, such as a 310, has traveled a couple hundred miles.
The neutral third party shop (with qualifications) conducts the ideal pre-buy. They’ve not worked on the aircraft for its current owner (the seller) and they will not be maintaining it for the possible new owner (the buyer). The shop is not covering for previous maintenance, a buyer’s concern, nor will they be creating a big work order for themselves, a seller’s concern.
If you’re purchasing a twin Cessna from a dealer/broker that specializes in them, they’ll almost certainly be aware of qualified shops around the country that conduct twin Cessna maintenance.
Clearly, understand the requirement for a comprehensive Pre-Purchase Inspection is not in question. Where this inspection takes place is subject to negotiation. RULE – Do not allow geography to sway you away from the best aircraft. Do not worry about travel. Three days, and certainly three months or three years after returning with a great twin Cessna you’ve forgotten the details of the delivery flight. The days, weather, hotels, FBO’s do not matter It’s OK to be inconvenienced when buying a twin Cessna.
Pre-Purchase Delivery Agreement
A subject that can often cause a pre or post sale problem is the responsibility for costs associated with flying the aircraft to the inspection location, and associated expenses. These costs, responsible party and method of payment can be addressed in the Offer to Purchase. However, I fmd it generally simplifies twin Cessna transactions by creating a simple separate agreement. In most cases the purchaser is responsible for expenses. This can be handled through the escrow agent, but this can become very complicated. It is much easier to have a single expense report that is submitted for reimbursement.
Let us assume in this discussion that an owner is delivering the aircraft from its home base to the inspection airport (“A” to “B”). However, if commercial pilots are paid to fly the aircraft to the inspection airport and perhaps return the aircraft to its present home base, then all pilot fees plus all normal pilot travel expenses i.e., hotel and meals are paid by the purchaser, unless agreed to otherwise. The commercial pilot’s time for the evaluation flight is an expense. If the sale is completed, the agreed to means of returning the pilot, an owner or otherwise, is an expense. This can include taxi to an airport and airline ticket. Hotels for an owner pilot is an expense.
Fuel expense is calculated for the flight from “A” to “B” at normal cruise speed and normal fuel consumption. The same numbers are used for the evaluation flight and return flight (“B” to “A”) if the aircraft is not purchased.
General Summary – Remember buyers go to the airplane. When they request otherwise, it is at buyers expense. Therefore, buyer pays fuel one way or round trip. An owner is not paid for pilot services. Commercial pilots are paid for all flight time. Hotel expenses, pilots or owners, are paid by the purchaser. With a purchase, returning pilot expenses are paid by purchaser.
The specific details for this proposed transaction, both with a sale and a non-sale, should be in writing, understood by all parties, and signed, before any aircraft are flown. Exceptions to these guidelines are not uncommon. Again, have it clear.
Actual payment of those expenses can simply be handled by invoicing the buyer, deducting expenses from an “expense deposit” held by the escrow agent, the seller’s broker or the seller.
Some Pre-Sale Administration
At this point where an aircraft has been selected, an offer has been accepted, a deposit placed, a Pre-Purchase Inspection and delivery flight arranged, it’s time to contact your insurance agent so they are ready to bind the aircraft upon a successful inspection.
If you are not yet qualified to fly your newly purchased aircraft from the inspection airport to your home you’ll need to arrange for post sale delivery support. Most twin Cessna insurance policies have an Open Pilot Clause which allow appropriately qualified pilots to fly the aircraft. Some sellers and many dealers/brokers will assist with deliveries. Important – make certain the delivery pilot is qualified per your policy and FARS. JTA has a standard package containing copies of Pilot’s and Instructor’s Certificate, Current Medical, and proof of qualification and currency in aircraft type that is sent to a buyers’ insurance agent.
You now need to decide how all sale documents will be made out. Any partnerships, corporations, special addresses, etc. Important – Get any loan documents signed and returned to the lender. A common problem is last minute “loan crises.” Do not assume any loan, loan rate or other terms. If you’re financing get this critical subject – the money – all worked out before the aircraft is flown for an inspection. Many dealer/brokers will require confirmation from your lender that “all is in order” before delivering an aircraft for an inspection or allowing such to begin. Double check details on hangars, training and planned major maintenance such as painting, engine overhauls, etc.
Pre-Purchase Inspection Flight
We now are at the facility that will conduct the Pre-Purchase Inspection. In attendance may be a seller, a seller’s broker, a selling dealer, a purchaser, a purchaser’s representative, demo/test pilots and mechanics. An evaluation flight by a qualified “check pilot” is needed. And, just as a pilot is tested by a check pilot, a pilot qualified in the aircraft and familiar with the aircraft’s systems and equipment is needed.
Without question, the seller or a seller’s representative has the right to be in the aircraft and be the Pilot in Command on any evaluation flight.
Take this flight seriously. Demonstration flights can get pilots in trouble. If you are the seller, or the seller9s representative, and will be the Pilot in Command, review with the buyer, or buyer’s pilot representative, who is PIC. Discuss which seat you’ll fly from and other flight details. Discuss what the buyer wants “to see.” Make certain the Pilot in Command, or you, knows how to set up avionics and other equipment.
This is where professional support can save you considerable money and perhaps grief A few twin Cessna sales professionals have professionally developed check lists that supplement normal aircraft check lists and assist the check pilot in the evaluation of systems and equipment. Purchasing an aircraft and then learning that the way something was demonstrated to you was not correct and what was thought to be a minor repair is the opposite can be shocking.
As stated above, the Pre-Purchase Inspection is a complex subject that requires an in-depth article to properly cover the subject. Many articles have been written on Pre-Purchase Inspections. Most publications offer reprint service.
All that will be said in this article is that the buyer has the right, and should conduct a comprehensive Pre-Purchase Inspection as discussed earlier. The selection of the facility is a negotiated item. If you’re not familiar with a shop, do some research. Ask the shop for recent customer referrals for the same type of aircraft. Ask the shop how many Pre-Purchase.
Inspections and/or Annual Inspections they’ve done on this type of aircraft in the last year or two? Ask to see their Pre-Purchase Inspection check list or Annual checklist. Call area dealers and brokers. Call the manufacturer’s customer service people. Call owners groups. Do not be shy. This is a high performance multi-engine airplane, they may cost more than your home. No professional shop or mechanic will be offended.
What is “looked at” on a Pre-Purchase Inspection is subject for consideration. Is the Annual only 30 days old and by a quality shop? Was it a thorough Annual? Your review of logbook entries and the work order will confirm the scope of the last Annual. Or, is the Annual IO months old. By whom? However, perhaps the aircraft has flown but 10 hours during this time. Good? Bad?
Often when the next Annual is due within 3 – 4 months, a buyer will want to combine the Pre- Purchase Inspection with an Annual. Sounds simple. Wrong. Very complex if thought out.
One method that protects the seller and his airplane and yet still tries to accommodate the purchaser is as follows: A shop puts on their “Pre-Buy Hats” and immediately looks at the major areas for possible problems. Logs are reviewed. Or, if a buyer wishes, an in depth Pre-Purchase Inspection is completed. The report is made to the purchaser. Decision time. Based upon this report the decision to purchase and fund in full must be made. If the decision is a yes, then you’ve purchased the aircraft. The shop can now switch to their “Annual Hats” and go about conducting further inspections and repairs. Few individual owners, dealers and brokers will allow a twin Cessna to be hundreds of miles from home, undergoing an annual inspection by a shop they’re not familiar with. It’s simply not smart.
The discrepancies – “squawks” found on twin Cessna Pre-Purchase Inspection in 1999 are addressed in the following way. First, know before starting that there will be squawks. Not maybe. There will be squawks. Most Pre-Buys are for machines built 20 – 25 years ago. It may be a poor term (airplane owners will know what I mean) but the small items listed on a squawk list and those that we’ll call “normal wear” and “usage” will not justify any repair or price concession by the seller.
Any major squawk is grounds for discussion. Most of the time these get resolved. After all, all parties are seeking the same result – a completed sale. Most often, a price concession is made and the aircraft is purchased. The new owner can now control all needed and desired maintenance. In a worst case scenario, the buyer does not have to purchase the aircraft and his money is safe in escrow. He’ll not have any return of deposit problems. As agreed to, the purchaser will pay for agreed to delivery expenses. And, in this worst case scenario, a seller does not have to make any repair/concession. Reason, common sense and the reality of a serious discrepancy usually influences an owner to properly address a major squawk.
It is often during this phase of a transaction that a seller’s or buyer’s broker, consultant, etc., earns their fee. Working through the problems and managing the details in order to produce a pleased and satisfied Buyer and Seller is a complex undertaking.
Closing the sale is an orchestrated event. Some actions are simultaneous, but here is a common sequence.
The Purchase Agreement is signed by Seller and Purchaser. If necessary, the typed in sale price, accepted in the Offer to Purchase, can be amended and initialed by both parties. In reality, the Offer to Purchase primarily protects the buyer. The price and conditions are offered. The Purchase Agreement primarily protects the Seller and his broker, if there is one. As with the Offer, in the Purchase Agreement all parties and the aircraft are identified. The “legalese” addresses the guarantee of clear title, the exchange of logbooks and other records. The Purchase Agreement will clearly address the subject of warranties and guarantees. The term “As-Is” and “Where-Is” may be repeated several times. Most used aircraft sales documents will stress that the aircraft is sold with no warranty, of any type, promised by the seller or any broker/agent.
In rare cases where a seller will offer some type of warranty, then the conditions and terms of this require considerable detail. Any item that may still have a manufacturer or shop warranty should be noted. The Seller should have researched this “plus” before beginning to market the aircraft and a Buyer should have confirmed the details of this when considering the purchase.
Most Purchase Agreements will state that each party is responsible for any taxes/fees that apply to Buyers or Sellers in their state, county, etc.
Most dealers and brokers have their own Purchase Agreement. AOPA offers an example. If a Seller’s attorney, especially one not familiar with general aviation has prepared the Purchase Agreement, expect it to be overkill. However, it usually does not require a stand-off and new negotiations.
If you are financing, getting the signed Purchase Agreement taxed to the lender is a priority. Many will require this before funding.
Call your insurance agent and instruct them to bind the aircraft and send you a bill.
Hopefully an escrow agent is being used. If so, advise the escrow officer by telephone and fax of the OK to fund. The escrow agent will use your deposited money, the 5 – 10% deposit, and any other money you’ve sent, plus any money being received from a lender to pay off any security liens and pay the seller.
The escrow agent will have completed several actions. The Buyer, and any lender, will have been provided with a title search. The escrow agent will have obtained an official lien release from any bank with a Hen filed on the aircraft. This is how they can insure you of obtaining a clear title. Lien holders and the Seller will be paid.
Sellers are protected by the escrow process in knowing that the Bill of Sale they must sign and submit is being held by an insured Aviation Title and Escrow fum. In addition, they are assured that the correct registration changes will be made.
Now that a twin Cessna has been purchased and is at its new home, it is time to address the discrepancies discovered on the Pre-Purchase Inspection, the Pre-Purchase Evaluation Flight and the Post Sale Delivery Flight.
Perhaps your local shop will conduct all maintenance on the aircraft. Perhaps they’ll only handle routine maintenance. Perhaps Annuals and major modifications will be conducted by a twin Cessna specialist. As with the selection of the shop to conduct the Pre-Purchase Inspection, conduct the same “due diligence” to choose the facilities that will maintain this major investment.
If your local shop is not familiar with your model twin Cessna, discuss their becoming so. Are they willing to invest in your business?
As a new owner, I urge you to purchase from Cessna a Service Bulletin listing and subscription. It can be long and intimidating. However, I would soon know what Service Bulletins have been complied with and which remain optional. Though ADs were reviewed in the Pre-Purchase Inspection, I would become familiar with each that has been complied with and those that are reoccurring
Now just as you would not consider for a moment flying without insurance, proper training or proper maintenance, then do not consider owning any aircraft without photocopying all logbooks and other critical maintenance records ASAP. See Cessna Owners Magazine 11/95 to read more about the why and how of this critical subject.
The challenge in preparing this Part Three was that such critical and complex subjects such as the Pre-Purchase Inspection, insurance, contracts, etc., must be reduced to a few paragraphs. Therefore, what you now hopefully have are guidelines that direct you to seek additional information and guidance on many subjects.
Like the purchase of a new auto, the purchase of a new aircraft is relatively simple. Select what’s now available or order it. Pay for it. The rules and procedures for purchasing a used airplane, especially a twin Cessna, are not simple, but complex.
The decision to purchase, fly and maintain a Cessna 310, or other twin Cessna is a major undertaking. When properly managed the decision can be very rewarding. Go For It.