Hi All,
I bought a used A/c , the loan payments was showing 147,000 per month and Lease was around 200,000; however the cash flow is showing 1,470,000 Loan payment to be taken off me, I though I might have made an error, I bought another a/c same thing again.
Is this right, never had anything like it in Nicosia. All payment were according to the Auction price.
Loans are repaid in 274 260 installments (you can also repay earlier if you wish). But that is just repayment of principal. On top of that you are charged an interest rate of 1 to 3 percent per week, based on all the outstanding amount. You actually pay way more in terms of interest than in terms of loan principal, at least initially, and at least for as long as you keep the installments payments low. All in all, loans are not a good idea to get planes. There are some calculations from AK and other players which show there are specific circumstances when loans might possibly be feasible, but such cases are few and far between.
Yes, I understand that concept, but what I mean is the payment quoted in the market is 10x time less than the payment indicated to be taken off my account.
I will repay the loan in 20 weeks with payment like that...
Total cost of A/c : 30,000,000 Loan repayments 1,470,000 + interest. Doesn't compute to 247 instalments.
@ ganzkrott, I think your 1,470,000 weekly payment includes interest.
This example would assume so:
But to be sure, go to Management -> Corporate Finance -> Debt
It will detail your loan-purchased aircraft, the amount you pay weekly in principal as well as what you pay weekly in interest (interest is based, of course, on the current outstanding loan amount, so interest will be decreasing weekly as you progress with your payments of loan principal).
The total of principal + interest should be the "loan payment" total that shows on your weekly cash flow statement (Management -> Cash Flow).
You will pay the loan evenly over 5 years (260 weeks, I corrected my above post, I did not initially take into account a 10% down-payment you make when you take out an aircraft loan).