This is a hugely complex question, and the answer depends largely on your personal financial situation. Also, aircraft loans are inflexible compared to consumer loans. Lenders will want 20% down, the first few payments in liquid holdings, and they generally won’t bother loaning you less than $50k-$100k. This means that if you can afford to finance an expensive plane, you can probably afford to buy a small plane outright. The converse is also probably true: if you can’t afford to buy any plane, you can’t afford to finance a plane. In other words, think of financing as a tool to expand the pool of planes you might buy or to buy a large plane early, not a crutch that you rely on to make owning any plane affordable.

Here are some additional details to consider when deciding whether to finance:

Tax advantages: If you will use the plane for business, you may be able to take a tax deduction on the interest or reap other accounting benefits.

Short-term ownership: Suppose you’re planning to own a plane for only a few years, maybe to get a rating or build some hours before upgrading. In this scenario, you only pay interest for a year or two. That might be cheap enough to be worth being able to avoid committing the cash needed to buy the plane outright.

Complexity: If you do finance, the purchase process will take longer and be more complex. The lender will want to approve your insurance choices, since they’re counting on insurance for getting paid if the plane is ever totaled. They’ll also need to be involved with your escrow service, since the money for closing will come from them.

Aircraft limitations: Aviation lenders will not give you a set amount of money to buy any plane you want; that’s far too risky from their perspective. Instead, you will get final loan approval for a specific range of models or even a specific N-number. Many lenders won’t issue a loan to buy an old aircraft or an exotic aircraft. If you’re buying a 172R that won’t be a problem, but if you’re looking at aircraft from the 70s or before you might not be able to get financing on any terms.

Financial requirements: Aviation loans carry far more stringent requirements than credit card, car or even boat loans. In the application, process you’ll need to provide extensive financial records. Limited job history, limited credit history, and insufficient liquid assets will all disqualify you. Terms are also less flexible: you’ll need to put at least 20% down.

Cost: Interest rates on aviation loans tend to be higher than the benchmark rate, and the benchmark rate is rising. Your cost to operate will be significantly higher if you’re paying interest on a financial loan.

Home equity line of credit: If you own a home with significant equity, you could consider tapping it. Your interest rates might be a bit lower, and the loan can probably be processed more quickly and simply than an aviation loan.

Risk: If you buy a plane outright and later need to stop flying, the worst case scenario is that you can’t sell the plane and need to scrap it. That’s a very extreme worst case, but even if it comes to that at least you can stop the financial bleeding. If you finance, however, that’s not the case. You need to keep making payments every month even if you scrap the plane. If you try to sell, you might even find yourself underwater and be unable to recoup the outstanding loan amount. Financing a plane is like any leveraged financial transaction: you take on risk.

Liquidity: If you finance, the lender will have a lien on your plane. This will make it slightly more cumbersome to sell in the future.

It’s worth at least talking to AOPA finance and see what they offer. They might reject you, or give you a stellar offer; both outcomes make the decision easy. It also costs you nothing, you don’t have to use it, and all else equal more flexibility is better when buying a plane.