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079 - Before You Buy, Prebuy: Cheap Insurance Against Bad Deals! - Airplane Intel Podcast, an Aviation Podcast

by Adam Sipe
November 4th 2020
00:46:57
Description

In today’s episode, we’re talking about all about the pre-purchase inspection—what it is, what it’s not, and why it’s a critical step in the purchase process of any airplane, from a Cessna... More

Airplane in town. Podcast Episode 79 This week, we talk all about pre purchase inspections, what they are and what they are not. Then five tips for selecting a pre by expert and five big ticket items to check during a pre by, plus some exciting updates. So stay tuned. Are you an aircraft owner, pilot or mechanic? Do you want to learn how to increase safety, reduce risk and save money with your airplane thin? You are in the right place. Thistles. The Airplane Intel Podcast The only show that tells you how to make aircraft ownership. Simple, safe and cost effective. Featuring the pre bye guys and brought to you by co flight dot com. We bring over 100 years combined experience flying, maintaining and managing all types of aircraft. If you're ready to make smarter decisions and get more out of your airplane, stay tuned. Hello

and welcome to another edition of the Airplane Intel podcast or in aviation podcast about the ins and outs of airplane ownership. I'm Adam. I'm a certificated flight instructor, airframe and powerplant mechanic with inspection authorization and the president of Airplane Intel. If you're a longtime listener, welcome back And if you're new to the show, welcome aboard. On the podcast, we compare airplanes, interview airplane owners and industry experts and, of course, give you real world tips for buying, maintaining and selling an airplane to join the conversation. Seymour Resource is or catch up on our episode archives. Head over to our show Notes Page at Airplane. Intel podcast dot com. Today's episode is brought to you by our friends at co flight dot com. Co Flight is an innovative desktop and mobile app designed to make aircraft ownership simple and fun. You can manage virtually everything about your airplane so you won't miss a thing from maintenance and eighties to scheduling and payments. The best part is that it's surprisingly affordable. You could get a 60 day free trial of co flight

by heading over to co flight dot com and entering the code pre by at check out. That's Charlie Oscar Foxtrot, Lima, Yankee tango dot com and entering the code pre by. I've been working on airplanes a long time and trust me when I tell you when you start using co flight, you'll wonder how you ever owned without it. In today's episode, we're talking all about the pre purchase inspection, what it is and what it is not, and why it's critical in the purchase process for any airplane from a Cessna 1 72 took Gulfstream G 5 50. I'm also going to share five tips for finding and hiring the right pre by expert, as well as five big ticket items to look for when doing a pre by that are often neglected. We're also going to hear from my favorite co host, Don Sebastian, the original pre by guy. In fact, he practically coined the term pre by, so I'm very excited to be catching up with him. But first we have some big updates. I know it's been a little while since our last podcast episode, but things have been crazy, crazy, busy for us over the past seven weeks or so. First, we've been doing

pre buys doing maintenance and flying a lot lately to help our clients by in Southern Airplane. Since the last episode, we've been to California, Texas, Louisiana, Connecticut, Arkansas, Oklahoma, Chicago and South Carolina for a wide variety of aircraft, including several Mooney M twenties, which seem to be pretty popular right now, to serious aircraft, a King Air F 90 a citation Mustang to V 35 bonanzas and in a 36 bonanza and a couple of Cessna 1 82 which are also quite popular right now. And we've got more travel scheduled for the rest of this month and into November, going to Oklahoma, South Carolina and Alabama, to name a few. So trust me when I tell you we are doing everything we can to get a podcast episode out to you guys. Also, since our last podcast episode, our company has moved into a new office and hangar at a new airport. So I'd like to officially announce that we've teamed up with shelter and working and flying out of our new location at the Ocala

International Airport in a California That's ko CF Oscar Charlie Foxtrot. So if you're ever in central Florida, come say hello to us at the old Terminal building just north of the new terminal building. I'd also like to mention that our company is growing. Shane Sandlin has joined the company as vice president. Shane is an A and P. C. F I, and brings a lot of experience to our company, and I'm very excited to have him on board with us. Also, we've joined forces with vision logbooks. Now you might remember our interview with Vision Low Books co founders Larry Hind Ball and Mark Leaper from Episode 72. Vision Law Books is the best way to cover your asset your airplane by ditching paper and digitizing your aircraft maintenance records. Doing so not only gets your airplane into the 21st century, but it also protects your airplanes value and pedigree. Did you know that 30 to 60% of your aircraft value is kept in law books? Paper logs can be lost, damaged or, for one reason or another inaccessible. Worse yet, law books are completely

uninsurable. So a Vision Law Books is the safe, secure and convenient way to guard against losing hundreds of thousands or even millions of dollars. You can learn more about vision law books at vision logbooks dot com. Oh, and on a personal note, I just bought my first house with my fiancee, Sarah, which is very exciting and stressful and hectic all the same time. So anyway, if you're wondering where we've been over the past seven weeks or so hopefully everything going on can shed some light on that. I'm not trying to make excuses by any means, but there's simply not enough time in the day. Sometimes, nevertheless, we're back on track now, so I'm glad to be back on the podcast with you guys today. I know that was a lot of stuff to talk about, but I'm ready to dive in to today's topic. All about pre buys. So if you're ready, let's go. So you've made the decision to buy an aircraft. But now what? Before you make an offer, enlist the help of a knowledgeable and experienced pre by

expert. Your dream aircraft may have a few skeletons in the closet that you want to know about before signing the dotted line. The pre purchase inspection, also called a pre by, is a critical step in the aircraft purchase process, similar to a home inspection. A pre by will help you discover any issues before committing to the purchase. A pre by inspection quickly determines the condition of the airplane as well as its true value. By uncovering paperwork, discrepancies, airframe and engine defects, maintenance issues and airworthiness concerns that could make the airplane unsafe, illegal or too costly to buy. In other words, a pre by is cheap insurance that protects you from a bad deal that pre by also serves to represent you, the buyer and your interest during the purchase process to assist in final negotiations in closing terms. Did you know, despite the vast regulations that govern pilots, aircraft operations and aircraft maintenance, there are no regulations whatsoever that govern aircraft transactions, which is

a huge reason why people could get burned. In fact, the number one cause for litigation during an aircraft transaction is failing. To perform a pre by. Performing a pre by is not only your right, but your responsibility is a buyer. Remember, once you sign the dotted line for an airplane, all of the aircraft issues, defects and discrepancies become your problem, and the FAA holds you accountable. Many people refer to a pre by as an inspection when in reality it's an evaluation or better yet, in investigation. You see, aircraft inspections are regulated and governed by the FAA, such as annual inspections or phase inspections. However, the FAA provides absolutely no description, guidance or oversight of a pre by because it is not recognized as an inspection. Therefore, a pre by is not regulated in any way and has no set standards. The lack of regulation and guidance means that everyone's idea of what a pre by is and what it should include is different. Some feel that simply glancing over the law books and performing a brief visual

examination is enough, while others believe that doing a schedule inspection, such as an annual or phase inspection will suffice. Look, every airplane has a different story to tell, and it's our job to uncover the fax from its ownership in maintenance history to its structural, mechanical and cosmetic integrity all the way to its flight performance and systems health. We believe in leaving no stone unturned. Why? Because the Onley time you get free maintenance on an airplane is before you buy it. So here are a few objectives of a comprehensive pre by number one. You need to verify the present condition of the airplane and that it is as represented by the seller to you need to verify the current inspection and maintenance status of the airplane. Three. Verify the airplane is airworthy and identify deferred maintenance items for verify the airplane conforms to all FAA, ours. It's type certificate and any installed S. T. C. S five

determined the health of the engine and functionality of all of its systems. Six. Determine the actual value of the airplane based on its condition and completeness of the records. Seven. Understand what the airplane is going to cost you as the new owner. Eight. Negotiate the final sales price or terms of the airplane based on the aircraft actual condition. Nine. Represent you and your interest during the purchase process. And finally 10. It provides an independent, unbiased assessment of the airplane. So now that you understand the objectives, let's talk about the outcomes of a pre by. So the ideal outcomes of the pre by our two determine if the aircraft is a goodbye. In other words, whether to buy the airplane or walk away from it to establish which defects will be repaired by the seller at their expense. Three. Identify how the defects will impact the aircraft value and cost of ownership, and four help you negotiate the final sales

price and closing terms. Now, as I mentioned a moment ago, there are no set standards or guidelines for pre by and therefore everyone has a different idea of what a provide should be. So what I'm going to share with you right now is our standards for a pre by the things that we include. So we break the pre by down into a three phase, step by step approach. Phase number one is all about understanding the aircraft's history and background. So those are things such as performing a title search, assessing damage history, auditing the ownership in lean history, auditing the major alteration and major repair history, ensuring that all the equipment installed in the airplane is approved and compatible with other equipment in the airplane. Perform a desktop valuation to see what a good asking price for the airplane would be. And we also deliver a written report with a follow up phone call to discuss what we found during this phase. Phase two, then, is something we would move into if everything in phase one checked out. So if everything looks good and phase when we move into Phase two, which is the records on it

, So the records audit includes performing a cover to cover audit of the aircraft maintenance records in long books determining the maintenance trends and utilization history. So in other words, if parts are being changed at abnormally high rates or parts that are failing, we need to know about that because that could affect you when we could get an idea of how often those parts are failing in an either an hourly kind of rate or what the intervals are. So you can see what the airplane would be probably doing in the next, say, 200 hours. If you concede exactly what you should expect to pay for that, we also audit the airworthiness directives compliance to make sure that all the eighties or comply with and nothing has been missed. We also perform another desktop valuation because things may now change. The more we learn about the airplane, the value of the airplane may change accordingly. So we perform another valuation on airplane. And, of course, with all this information, we could develop a customized provide checklist based on the aircraft's history, for when we go actually see the airplane and at the end of this phase, there's also another

written report with a follow up console call. So if everything checks out in Phase one, we move on to phase two, and if everything checks out in Phase two, we move on to Phase three, which is the actual on site evaluation of the aircraft. And what that would include for us, anyway, is a maximum performance test flight to determine engine performance systems, health and avionics functionality, thes air, just things that you can really not check all the functions on the ground. And you can't know the actual performance of the airplane on the ground either, because you need to know what it's going to do in the air where the air is thinner and colder and so on. We also bore scope, the engines, the wings and access limited areas. We check compressions and Mac timing for piston airplanes. We perform engine oil analysis and filter inspection. We check for conformity to the type certificate and S. T. C. S, and we perform a nose to tail visual examination of the aircraft for corrosion as well as mechanical, structural and cosmetic integrity. And of course, at the end of this, we deliver our final written report

with a follow up phone Consult. Now, everyone's opinion of a pre by May vary, but let me give you five tips right now for hiring a pre by expert Number one. The person needs to be 100% independent from the airplane and the sellers of the airplane, whether they be the broker or the owner, etcetera. I know a lot of times people are told that, uh, they know a mechanic that happens to be on the field or that happens to be close by, uh, nearby airport or what have you, and that's fine. Assuming that they are completely independent of the airplane, they have never worked on it before, and they have no ties to the cellar or broker in any way. Number two. They should be familiar with the aircraft make and model because every make model has its own kind of quirks and idiosyncrasies based on things that have been seen over the airplane while in the fleet over the years. So that person should be very familiar with that airplane as much as possible. And then, you know, it kind of just piggyback off that in addition to

being familiar with the make and model, they should be familiar with the airplanes history so that they know what to look for when at the airplane. Like I just mentioned, that's the whole purpose of face to for us. I also recommend reading reviews and interview the shop or mechanic before you hire them to do the pre by to ensure again that they're independent from the airplane and familiar with the make and model, but also find out a little bit more about what they're going to do well at the airplane again, Some people have a very kind of brief overlook of the airplane while others trying to do an annual inspection on the airplane and so on. So there's so many different ways that that could go. So you just go on to get an idea of what they're gonna be looking for. While at the airplane. Number four is. Make sure that the person doing the pre by, whether it's an independent mechanic or a shop main shop of sorts, make sure they are insured because that can open up an enormous amount of problems for you. If those folks aren't insured. I know a lot of mechanics Dupri buys may be on the side, and they're probably not insured. And by that

I mean, they should have general liability insurance and, ideally, property insurance as well as professional liability insurance. So those are some things to be asking for because, let's say hypothetically, they're doing some work on the airplane during the pre by and they find something that's broken on the airplane or they happen to break something while working on the airplane or while inspecting it. You could be liable for that because you hired them. So the seller may come into some sort of lawsuit with you and or that mechanic, so the insurance will make sure that that that isn't a problem. And number five, when you're hiring this person or this shop, make sure you have direct communication with them during the entire process. Make sure that they are going to be checking in with you and updating you regarding the status of the airplane, what they're finding out so far and what they think the implications are of what they have found at this point. And, you know, having direct communication with them is important because it will save you an enormous

amount of time in frustration, trying toe chase people back and forth. So those are my five tips for hiring a pre by expert. So now let's talk about five big ticket items to look for during the pre by. Now, some of these things you can dio as a pilot on others a mechanic will have to dio. But of course, now the person doing the pre by works for you so you can at least direct them to do this. The first thing is to audit the aircraft's records. Now I've talked about that's kind of what we dio, but this is an overlooked item. Often, sometimes people glance through logbooks or just kind of do what is often referred to as a log book review. And you know, sometimes that's enough, you know, But ultimately you want to go through the aircraft's records. You want to go through the law books. You want to go through any of the loose documents that might be a part of the airplane, which so, let's say, for example, the seller gives you digital copies of the law books through PdF or photos, or what have you. That's great and definitely a great place to start, but that's only part

of the maintenance records for the airplane. There are other things going on there, so a lot of times there's loose documents at the airplane. So if you happen to be going to the airplane or you have someone doing the pre by for you and you know they're gonna be at the airplane on your behalf, you can tell them to check through all the loose documents, the loose documents. We're probably gonna include things such as the current A D compliance list, any maintenance releases or work orders or invoices from past work. Now you know, you can generally look through the law books and get an idea of what items should have work orders. So any of the larger maintenance events that occur inspections, parts that were changed, engine overhauls, all that sort of stuff. When you see that you should definitely keep that in mind to look for work orders and invoices, because that's going to break down precisely what was done and precisely what parts were replaced, overhauled, sent out for service, etcetera, so that's a good place to start as well. You can also find parts

tags, which you'll need for serialized parts or 81 thirties, which you need for pretty much all parts. So you're yellow tags and you're 81 30. Those air your birth certificates for your parts. This is especially important on serialized parts such as your props, engines, Magneto's engine, accessories and appliances. In other large components of the airplane, something else that ties into aircraft records is verifying the current airframe. Total time, an engine, total time and engine times since major overhaul. Why? Because this has huge impact on aircraft value. For one thing, and to depending what the airplane is. Knowing exactly what the Times are will help you plan other maintenance and inspection events in the future. Sometimes the listing has either incorrect times or times that have not been updated in a while. Perhaps airplanes been listed for two or three months, and the airplane's been flying during that time. So now the total times are different, and the engine times and so on could be different. I've also seen it where people

make mistakes in the adding and subtracting of the Tech and Hobbes times, and such to the point that the time's in the log book, the most current times are inaccurate. So that's something to check out because it does have a huge impact on value both the airframe, total time and the engines overhaul time. The second item to look for and check out is the aircraft documents, so that would be your airworthiness certificate to make sure that it's valid and current and installed in the airplane and not damaged in any way. It's not uncommon to see them kind of ripped up or smeared or blurry or faded and all that. You know, that document is to be readable, and that's what the FAA says about it. So if it needs to be replaced, you need to know about that. Um, if it's a missing, of course you can't fly the airplane because that's required documents, so that's something to check out. And when you're looking at it, you know, make sure that it's for that specific airplane by making model and by serial number. Another thing to check for is the weight and balance. You want to see that the airplane's waiting balance has been updated and current at this point. That's

a required document, of course, but also helps you to see what's been added and taken out of the airplane over the years. It goes without saying, Check the registration for the airplane. Can't fly without a current registration. This would also help you double check that the people selling the airplane or if they registered owners for the airplane because it will have their name on the certificate itself. The next thing is the aircraft limitations. Now these will either be in the P O. H or the A F M. It could also be depending on the airplane. It could be on the panel as well. So you wanna make sure that all the aircraft limitations are installed in aircraft in some way, whether it be in the p. O. H a, f m or on the panel. And lastly, you want to see some things in the flight manuals such as flight manual supplements. Now again, if you went through the aircraft records so all the S. T. C s and and 3 37 forms that were done. You'll also see that some of those items require a flight manual supplements. They wanna make sure those were installed as well as any instructions for continued airworthiness. The last thing I'll say about this item number two aircraft documents. You can

check and verify the aircraft data plates. So the aircraft itself has a data plate. It could be in the door jam. It could be riveted to the fuselage. It could be by the cabin entry door. It depends on the airplane. But you want to see that That data plate matches the serial number for that airplane. It also applies to the engine as well as some of the bigger appliances and accessories for the aircraft. So those are some items to check out? Definitely for the airframe and definitely for the engine or engines. Because that's going to tell you what the current part number and serial number is. And hopefully that matches of logbooks and there hasn't been any engine changes that were not documented. Which, of course, undocumented maintenance is illegal. And a red flag. Okay, so number three in this five things to look for. Make sure you do a thorough preflight on the airplane and think like a test pilot. Okay, so you're gonna be buying this airplane hopefully and you're gonna be putting it through its paces. So preflight the airplane like a test pilot and some things you could be looking for that are kind of outside the box

is you can look for hail damage, for example, basically with the light just right outside, kind of look at the airplane skin surfaces like the wings and the stabilizers, and on top of the fuselage, it kind of a low angle, and you can see little dimples in the skin. Hail Damage, of course, is difficult, if not impossible to fix and a lot of cases. But it does have an impact on the airplanes value, so that's something you can definitely check out another thing to its surface corrosion. So if you see bubbling paint or rust on any of the hardware, things like that, those are some items to definitely take a look at and think about when you're doing your pre flight. And another thing I would say is check the door and window seals so the door seals around the cabin door and the baggage door, make sure they're not ripped or deteriorated or peeling apart or anything like that, because that not only impacts sound of the airplane noise levels and such, but also it could lead to exhaust leaks going into the cabin. So you want to check that out? Window seals is pretty similar because the window

seals keep out all the water. So that's something to definitely check into a swell and tip Number four is do a thorough test flight of the airplane. Okay, so what you're gonna do, basically, here is you're not gonna be the pilot command. In fact, I recommend not even flying the airplane period. Have yourself sit in the passenger seat in the right seat and have the airplane go through a test flight with some that's approved on the owner's insurance. And that will reduce any liability that you may face should something happen. But basically, during this flight test, you want to check the engine to make sure that it is making full power and that the takeoff distance is pretty good. The rate of climb is good and that the cruise numbers are good in terms of speeds and field burns and power settings, and so on. So those are some items to definitely to be doing. That's really the only way to know the health of the engine. Realistically, the health of the entire engine anyway, So it's a quick way to do it to flight test last. Maybe, you know, 45 minutes or so and that's something you can check out. I also recommend during the flight test, check all the systems of the airplane. So if the airplanes got

air conditioning or de ice equipment or oxygen or anything else like that, you can check all those things during the flight tests as opposed to doing it on the ground, because now you're putting it through its paces in its operational environment. Things that might work OK or seemingly work okay on the ground may not work in the air per se. So this is the best way to make sure that all those systems are working correctly. You know, again, if the airplanes pressurized, that's another easy way to check the pressurization system on the airplane as well. And, of course, during the flight test, you can check all the avionics, So if the airplane has an autopilot, you can have the art do most of the flying, make sure that it contract headings and track in knave bowed to view ours or GPS courses that all the modes within the GPS and or multi function display works correctly, Aziz. Well, and the way it should be operating, you can fly a couple of approaches. I recommend flying A I l s approach and they aren't have approach, you know, with the autopilot as much as you can, and again going back to the pot, making sure that it it can hold altitude. And if it's supposed

to work in, I asked mode or flight level change mode that it does that or if it's supposed to be capturing an altitude, that it does that or holding an attitude that it does that and that there's no deviation. The other day I did a flight test on a 36 bonanza, and the airplane would turn right with heading mode but not turn left. It was very slow to turn left, and the airplane would actually make a right turn when you're selecting a heading to the left. So that's obviously an issue and something you wouldn't necessarily find on the ground. Okay, so my last tip tip number five things to do during the pre by. Look over the engine or engines very thoroughly. Now, this is gonna be true. Whether you're dealing with a turban airplane or a piston powered airplane. Just look at the engine you're looking for. Signs of fluid leaks, air leaks such as leaks in the bleed air system or leaks in the exhaust system or leaks in the turbo charging system, as well as fluid leaks like such as fuel and oil and any kind of corrosion that might be in the engine as well. You can also be checking the ignition system, so spark plugs and ignition

leads and the Magneto's you know, for example, it is not uncommon to see the P leads on a magneto for piston powered airplane. Maybe one of the terminals has bent and almost broken, or the boots air not attached to these air. These things you can see visually and make sure that they're okay. Another thing would be to check the flywheel and the starter shaft, because it's not uncommon for those items to have broken teeth. And those can be pretty expensive. So definitely look over those engines of surly is possible, particularly with cylinders and exhaust systems and the ignition system and all the appliances. So those were my five things to look for that are often overlooked during a pre by. So what I'd like to do now switch gears and get into my discussion with Don, the pre by guy to talk a little more about pre bys and why they're more like an investigation as opposed to an inspection. And we're also going to touch a little bit about why doing an annual in lieu of a pre by is really not the

smartest idea. So let's catch up with them right now. And today I'm really excited because we're joined by our famous co host, Don Sebastian, the original pre by guy. Hey, Don, it's great to have you back on the podcast. How you doing? Okay. Feels really good to talk to you again. Like to say about all those podcasters out there in aviators? Yes, for sure. And you've been dearly missed by all of our faithful listeners. So it's great toe. Have you back on again? We're talking today about the difference between a pre by and an annual inspection as well as some items, too. Kind of really be careful of and mindful of when it comes to a pre by. So, Don, if you're ready, I'm ready. Let's get right into it already. Perfect. So Don, you've been doing pre buys a long, long time. In fact, I mean, you've basically invented the term free by so kind of tell us a little bit about what a pre by is and how it's different from other inspections that we may have heard about, such as an annual inspection or 100 hour or any kind

of progressive inspection. Pretty by is in a formal inspection, so it's not recognized by the FAA as an inspection. We inspect the airplane, but it's more of an investigation. It's more about finding defects and is about performing certain tests. It's a lot different than an annual in an annual inspection, A soon as you start inspecting it, the plaintiffs in airworthy it's made on their word till it's signed off. But in a pre by. That's not the case, so I recommend a pre by holds the time. So whenever you say I had enough, I'm not buying the airplane. If that's the case, that's when our inspection ends. Another big difference is we fight. Test the airplane, Darren. Before we start to provide and then annual inspection. It's a group simply a ground inspection so not required to fight by war. Yeah, that's right. You know, I think the word

that I love that you use is investigation because ultimately were like airplane detectives were here to see what's wrong with the airplane from its entire history, anything that effects the value of the airplane, which is especially important when you're buying it right, because the new owner becomes the responsible party for any issues of the airplane has. So obviously, we want to try and find out what's wrong with the airplane before you buy it. So that way, the current owner can correct any of the defects or any of the items that affect the value of the airplane, Right? Don? Yeah, that's right. Yeah, we're actually we're looking for the big items. It might not be on the checklist for the airplane and annual inspection. Every year the airplane gets an annual inspections that's pretty well covered, greasing the wheel bearings and stuff like that. But a pre by inspection, I say inspection. I should say investigation is different than an annual because we're looking for the effects

that hasn't been discovered over the years of the airplane. A lot of these airplanes now is 60 years old, so there's a lot of things that an annual inspection doesn't cover. That's exactly right. And it's interesting because we always find something unique to the airplane based on its history and often times, it's a paperwork problem. It's a issue with logbook or missing documentation or inadequate documentation. And that's enough to make not only the airplane on airworthy, but also maybe potentially cost the new buyer the new owner. Ah, lot of money because there's equipment installed that either doesn't work or doesn't belong in the airplane because there's no record of it being there or no stc four it or no other supporting documents to say that that equipment belongs there and we see this a lot, Probably. Don. I know you've seen it with simple things that seem harmless, like the addition of a landing light or the the moving the location of the landing light. But that's an issue, right? If there's no paperwork

, that could be a major problem down the road. Yeah, glad you brought up the S a a SE supplemental type certificate. There might be things on the airplane through modification, maybe as long as 30 or 40 years ago, and there was the paperwork and we don't have the STC. I was a sharp mechanic in the annual inspection. You might say to you, Well, if you can't produce the sGC, I'll take the part of the airplane. Bring it back to its original configuration. So gift T STC is missing. It's up to the seller to produce it, and that might be my good pretty involved, especially if the year it was done 40 years ago or so. Yeah, there's a lot to that because it seems so simple, and it could be something as simple as the landing light. As I mentioned, it could be something big, like an engine swap that was approved by STC previously. But if the paperwork isn't there or it's inadequate, then

there's an argument of, well, really a question of whether that equipment or that engine or that modification belongs on the airplane. And that couldn't cost the buyer or the new owner. I should say a lot of money down the road and something like a landing light, Let's say, might seem pretty harmless because, you know, it's just a landing light. But what happens if that landing light causes a fire or an electrical failure or a short circuit somewhere? That's a major problem and especially the airplanes covered under insurance. And there's an accident as a result of it. I mean, the insurance company made deny a claim because there's no proof that that equipment belong there to begin with. And not only that, you know, like you mentioned on the paper could be lost. Or maybe the STC holder. The people that that made the STC and got it approved are no longer in business. And now that paperwork, they're either going to charge you a lot of money to get the paperwork, or it may not be available at all. And that's just one of the many items that come up during a pre pie. Isn't that right? Yeah, that's right. Most

of the older mechanics kind of overlooked that during an annual instruction. But if you get a young guy, just a young inspector, what's Rice mechanic? Well, except you, of course, that, uh, you would notice it, but a lot of mechanics wouldn't notice that the paperwork is missing and it would get by angles over the years. A matter of fact, we find these airplanes that have 10 and 20 annual inspections. And the paperwork was Vincent, Darren, those inspections and it was overlooked. Yeah, and it could be S T. C s. It could be previous maintenance done on the airplane for a major component, like a serialized part. It could also be for a nadie. Um, any of these items could be overlooked or missed or undocumented or lack of documentation for something like that. And that's when things get kind of complicated. And again, that's part of what we're doing here in a pre by is investigating the history of the airplane to see what is this airplane going

to cost you as the new buyer or the new owner of the airplane down the road? And how can we reduce the risk of buying this airplane? Ah, lot of people think that the pre by is all about, you know, physically looking at the airplane to make sure that it's in good shape and and even even that notion is somewhat vague. But yeah, we're, of course, looking to see if the airplane is cosmetically, mechanically and structurally sound. but we're also looking to see what are some of the skeletons in the closet that might be in the records. That's right. Our mission is dedicated to find defects where in an annual inspection, they have a checklist. There have been you. Their inspection is dedicating on the checklist. So it's like we're out of the box looking at things that will take away the value of the airplane. And this way, if you terminate the inspection, that's it. An annual inspection. If you order an annual inspection, you have to pay for it

, even if you terminated. So if they come up with with something expensive defects, the seller can turn around and say to you, Well, you caused it. You cause us to do an annual inspection and he might be very marriage about it might even turn into a a lawsuit. So it's best that you find out ahead of time before it goes into it. An inspection, how the airplane is If there's any big items disqualifying, Yeah, absolutely. And another point to that is most of the purchase agreements that are in place for the sale of an airplane do not include the annual inspection as a authorized maintenance event before the airplane is bought. So a lot of people I see that they want Thio get an annual inspection done. That's not in the purchase agreement. They're not actually legally allowed to do that. So that's another point that is overlooked. It's It's all about the details, right? The devil's in the details, so you wanna make sure that you're protecting yourself during the transaction process and, as you mentioned a minute

ago, down any scheduled inspection like an annual like 100 our like Maybe if you're dealing with a more complex airplane that has other hourly or calendar time inspections or a cycle inspections, you really don't want to be doing those items, at least not initially during the pre purchase process. The pre my process because once you start those inspections, you have to finish them through their completion, right? They have to be done completely because, as you say, the airplane is rendered on airworthy until it's signed off. That's right. The seller is really happy when you do an annual inspection because you're putting in a proof the airplane, and even though you might not buy it and So you're bargaining Point is less, he figures. Well, I got this guy now. He's paid for an annual. He'll accept any of his effects that he finds. And you might not be thinking that way because you don't know what the defects of cost. But to sell. You tell the figures. Well, an annual inspection you put in a value into the airplane so you become it becomes less of a bargaining chip

for the spire. Yeah, you don't want to get yourself to committed to the airplane too soon without proper due diligence and knowing what's going on with the airplane now. Hey, Don, I got a question for you. What are some items that are important for prospective buyers to be looking out when they're going through the airplane? Let's say they've gone through the maintenance records already, and now they're trying to decide what items should be looked at during the pre by what some advice that you might have for someone basically, uh, an on site inspection. Most of the time I find chips in the propeller and there fell might not be a worthy because the ship might be so deep that it doesn't meet the requirements. I found airplanes that have hailed down and so bad that makes it unfair worthy. And these are things that you can't really see unless you get to the airplane. A lot shows up on the flight test. That's why as soon as you get airplane, the first thing we do is a flight test because avionics wise and performance of the airplane doesn't meet the numbers. What

are the numbers? Take off distance over 50 ft off So great a coin and to spe had altitude with the known power settings. If it doesn't meet the numbers, then there might be something wrong with the airplane. We have to check out even further. Yeah, absolutely. In the engine is a very expensive piece to the puzzle. That's probably one of the most expensive pieces of the puzzle is the performance of the engine. And yeah, you could do a compression tests and you can do bore scoping, which we do those things as well. But that doesn't tell you the performance of the engine and doesn't tell you the overall health of the engine, particularly the bottom end of the engine, right, while the all the rods and bearings and the crankshaft and all that that could, which absolutely affect the performance ability of the airplane. In addition to that, another purpose of that test flight is to make sure that the systems of the airplane are working, especially if the airplane has modifications to it through those S t. C s or what have you that all the equipment that's installed on airplane is working in all modes

and in all functions. And that's particularly true with the avionics, such as an autopilot or something like that. These are items that you really can't check thoroughly or completely on the ground. You have to fly the airplane to check these things. Isn't that right? That's right. The pilot is at this point that might not be working at all. And there's no way to check by the airplane. And if you do ground tests on the avionics, it costs a lot of money to ground chest was an avionics technician. This way, we get old airborne so inside of the first hour or two being with the airplane. We've gathered a lot of intelligence about the airplane and constantly reporting back to the buyer and he constantly makes the decision whether to buy the airplane or not buy it. By doing that, he talks to the cellar and asked for the Cells commitment to fix these items, right? So the idea is to learn as much about the airplane is possible. We do that through the due diligence of the FAA records

and maintenance records, and then we get to the airplane. And we have, like, a checklist that we've come up with based on the airplanes history by going through the logbooks and the FAA records, of course, and determining in the quickest way possible. What's the condition of this airplane? What's the status of the airplane? Is it as represented? And what's this thing gonna cost to, Oh, for the foreseeable future? That's right. And even though you might get the workbooks copies of the logbooks me out to you thio email. It's important that we physically see the about books and that they won't match up and using dates because a lot of times you'll notice in the logbook between boggles number three and four, for example, there might not be any entries have a logbook missing, so that's important. Not only that. But if your plane was on the ground for an extended period of time, that indicated it might have been damaged. Yeah, that's a great point. And that's not anything, you know, it's not just what the logbooks tell you, it's what they don't

tell you. It's the data that's missing that is important. You gotta read between the lines, and that takes an enormous amount of experience to determine those sorts of things. That's right. So after we're done with the pre by inspection, then we give you give the old buyer advice on how to proceed, whether you should maybe take the plane the way it is after negotiating the defects or putting in for an annual inspection if it's getting close to one. But we don't recommend that the seller paid for the annual inspection. I mean, we recommend the seller orders of annual inspection. Even though you you bought it, you could pay for it in escrow. And the reason why is because the liability reasons in case things don't go well if the seller sign sign permission for the annual inspection and it's his problem like yours. Yeah, that's right. It's quite a complex process. I mean, it's pretty straightforward overall, but the intricacies of it are are kind of

complex, which is why, you know, in our opinion, you need to hire an expert. Someone that knows pre buys very well knows the airplane well, knows what to look for and knows how to do a pre by so that you're protected when it comes time to make that decision to buy that airplane or to walk away from that airplane. Yeah, that's right. And the insurance company requires all the times that you do it because they want to see the list of defects of the airplane, right? The insurance company and the bank do if you're gonna be financing the airplane as well. And if you're using the airplane for business use, your board of directors might want to know about it a swell. And you know, by the way, that reminds me during the whole process. Here we're writing written reports on the findings of the airplane up to that point that we can use to adjust the value of the airplane as well as the status of the airplane so that us, the prospective buyer, can make many decisions and many opportunities to walk away from the airplane or to continue to move forward on the airplane before you commit a whole

lot of time and money to it. That's the whole idea. It's a step by step, pays you go kind of approach that you can use, and there's many ways to go about it. And of course, we can be flexible with our approach with you because every situation is unique and every airplane has got a different story to tell and everyone's budget and objectives are different. So it's important that whoever you have do your pre buys is flexible as well with you to make sure that it works in your best interest, the entire process don. You've been so ahead of the power curve. I think over, you know ahead of your time, so to speak, because you are doing videos sending to your clients of the airplanes for the last what 30 something years right? You've got literally hundreds of archives of videos that people got to see before YouTube and before the Internet. Even so, people can see what you for finding on the airplane, and I'm going to be uploading some of those videos that you've been creating over the years on to our YouTube channel youtube dot

com slash airplane Intel. So people can see just how much of an expert you are and and the various things that could come up during a pre by or pre purchase evaluation. Matter of fact, it used to be kind of hard in the old days. He was VHS, um, and I had, you know, and get the FedEx at night and send it to the by prospective buyer. So the next morning, before we talked to the cellar again, he had the video put it so much easier Now is direct communications and the Internet service. We could go face time, zoom or Skype or any whatever media that shall we would like we can be directly connected. Yeah, that's exactly it again, we're just here to help you in the best way that we can. Is there anything else you wanted to add to our conversation, Don, or should we start wrapping it up? No, I I guess we covered it pretty well. So I have a good day, you fellow aviators, and I'll sign off on our great down what was really awesome having you back on the podcast, we appreciate

it, and I hope that you are on the podcast again in the near future. It's always great to hear from Don, and I'm very happy we were able to speak with him on today's episode. Well, that's going to wrap it up for us today. Thank you so much for joining us. It was really great having you aboard, and we hope to see you again real soon. You can check out links from today's episode at Airplane intel podcast dot com, as well as check out past episodes and send us your questions. As you know, we love hearing from you. Also, don't forget to check out our friends at co flight by heading over to co flight dot com and entering the code pre by at check out for a free 60 day trial. Be sure to watch out for upcoming episodes as well. In our next one will be interviewing a law book expert to find out exactly what should be in an aircraft logbook, not only to be compliant but also increase the value of your airplane so you'll definitely want to check that out until next time. Stay safe and keep the dirty side down. We'll see you later. Thanks for listening to the airplane until podcast

. If you liked what you just heard, we hope that you'll subscribe to our show and leave us a rating or review. You can also follow us on YouTube, Facebook, Instagram and Twitter by searching airplane Intel to access show notes, episode archives and other free resource is Visit us at airplane intel podcast dot com to get a 60 day free trial of co flight, head over to co flight dot com and use the coupon code pre by. Also, if you'd like to support our show, visit us on patryan dot com. Forward slash pre bye guys. And remember, owning an airplane doesn't have to be hazardous to your wealth.

079 - Before You Buy, Prebuy: Cheap Insurance Against Bad Deals! - Airplane Intel Podcast, an Aviation Podcast
079 - Before You Buy, Prebuy: Cheap Insurance Against Bad Deals! - Airplane Intel Podcast, an Aviation Podcast
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