Buyers Guide FLYING Magazine

Escrow and Aircraft: Why It’s Important and How It Works

This guide will walk through what you need to know about using this financial agreement to purchase an airplane.

Christina Hancock

Tuesday, April 29, 2025 at 01:14 PM ET

Verified

Edited By: Nick Torres

Due to the substantial financial stakes, people involved, and FAA requirements, it is critical to ensure that the process is smooth and secure. [Adobe Stock]

Key Takeaways:

Aircraft purchases are significant investments requiring secure processes, which aircraft escrow and title companies provide as a neutral third party.
Escrow services protect both buyers and sellers by holding funds and documents, ensuring simultaneous release, proper FAA registration, and handling lien payoffs, thereby mitigating transaction risks.
The escrow process involves setting up the account, depositing funds, conducting thorough title searches to identify any liens, collecting all necessary documents from both parties, and finally disbursing funds and filing ownership with the FAA.
A crucial part of the process is an aircraft title search, which verifies legal ownership, identifies any encumbrances or liens, ensures proper registration, and helps prevent fraudulent transactions.

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Purchasing an aircraft is a significant investment, whether you’re a private individual buying a small personal airplane or a company acquiring a corporate jet. Due to the substantial financial stakes, people involved, and FAA requirements, it is critical to ensure that the process is smooth and secure. Using an aircraft escrow and title company can be a significant tool in the purchase of an aircraft. This guide will walk through what you need to know about using escrow, why it’s important, how it works, and considerations to keep in mind.

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Christina Hancock

Christina Hancock is the senior escrow adviser at Aero-Space Reports, bringing over 18 years of industry experience.