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Rules on buying or selling amateur builts/experimentals


ekisbey

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I'm still doing some research on just about everything aviation related, to include frying my brain trying to figure out the faa.gov website. There's so much information there that its hard to find something specific.

 

What I'm looking for in particular are the regulations/rules pertaining to resale or selling of a homebuilt aircraft. I know it can be done, but I was curious if there are people who build them for profit, as a source of income. There's a fella I met once in California who builds RC planes in his spare time and sells them, making a tidy profit in the bargain. He's retired, and can afford to spend the time, but he sometimes turns out two or three a month, and from what I saw they were really well put together. I guess he was one of those who preferred building them to flying them. Does the world of homebuilt aircraft have an equivalent?

 

By the way-- I plan to build mine, so please no comments about wimping out! :)

Evan Kisbey

Cozy Mk IV plans # 1114

"There may not be any stupid questions, but I've seen LOTS of curious idiots..."

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Hi There,

 

I'm not too sure about regs in the US but in the UK here are the points to be noted.

 

Considering Purchasing an Aircraft?

 

Documentation to be Checked

 

Permit to Fly

(or Certificate of Airworthiness)

 

Certificate of Validity

(This shows whether the permit has expired or still current, and when it will expire)

 

Certificate of Registration

(This shows who the CAA consider owns the aircraft)

 

Flight Release Certificate

(This shows when the inspector last carried out an inspection)

 

Airframe and Engine logbooks

(Check that regular entries have been made and suitably signed for by the owner and inspector)

 

Weight and Balance documents

(This will show if aircraft is overweight or out of balance)

 

Hope this helps.

I'll never get this project off the ground. lol :-)

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I highly suggest you join the EAA and then have them send you all the past articles written by Ron Alexander. He wrote a whole series of articles about how the FAR apply/don't apply to homebuilders, then how to prep the plane, yourself, and your records for the inspection.

 

Wayne Hicks

Wayne Hicks

Cozy IV Plans #678

http://www.ez.org/pages/waynehicks

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....Oh, and Ron Alexander did write an article on homebuilt resale, incluing pros and cons to put into the contract to help avoid potential litigation. On the subject of resale, I hope this doesn't break the homebuilder industry. There are alot of specialty shops out there that are "building" and then reselling for profit. (The Lancair IV-P comes to mind...). The rules are quite specific, that it's strictly amateur, with the gist of it being to educate one's self. I hardly consider sending $500,000 to a specialty shop, then getting a completed plane in return to be within the spirit of the "amateur" aspects of homebuilding.

I just hope we still get to build planes once they bust these shops.

 

Wayne Hicks

Wayne Hicks

Cozy IV Plans #678

http://www.ez.org/pages/waynehicks

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There is nothing illegal about someone building a homebuilt and then selling it. As long as that person registers it as a amateur built aircraft under FARMAT 21.191 PAR(g).The FAA developed the "amateur built"classification many years ago to separate guy's like you and me from the manufacture.Because of that,We do not have to have PMA(parts manufacture approval)numbers on our parts and expensive liability insurance,like certified aircraft have.The term amateur does not isolate it to someone who's building a homebuilt in there garage and has no intention of ever selling the aircraft. Under FARMAT 21.191Experimental certificates PAR(g):

 

[Operating amateur-built aircraft. Operating an aircraft the major portion of which has been fabricated and assembled by persons who undertook the construction project solely for their own education or recreation.]

 

There is absolutely nothing pertaining to economic or capital gain.In fact,if you read all FARMAT's you will find nothing pertaining to capital gain concerning certifying certified aircraft.It all has to do with integrity and airworthiness of an aircraft and the criteria to which each aircraft must operate in it's present and or,future form.

 

Joe Cygan

www.cyganfamily.com

Cozy MKIV #1022

Joe Cygan

Cozy MKIV #1022

Southern California

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Okay... NOW I have questions. Please bear with me. The more I'm learning here, the more unanswered questions I end up with. :)

 

So let's say ten years from now I lose my mind and sell my Cozy, perhaps to buy a 310 or some such. I was reading the regs on who is authorized to perform maintenance on an experimental, and as I understand it, the builder of the aircraft, by virtue of being considered the manufacturer, is by default an authorized service provider. On the other hand, I would not be authorized to perform similar maintenance on the 310.

 

Who then, other than another Cozy builder, would be able to perform maintenance on my Cozy? Doesn't a mechanic have to become certified for the aircraft he's performing maintenance on? And if so, how does he become certified if it's a homebuilt, other than building one of similar type himself? :confused:

Evan Kisbey

Cozy Mk IV plans # 1114

"There may not be any stupid questions, but I've seen LOTS of curious idiots..."

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Being in Canada - the rules are somewhat different, and have recently changed again for the better (stop reading now to avoid drooling!) :P

1: An amateur built aircraft is maintained by the "OWNER" who is responsible for any contractor "AME". New also for certified A/C, the owner is responsible for everything done with, by or to the A/C - and be satisfied that the AME etc has done everything required.

2: An amateur builder may "subcontract" any portion, but must show direct control and supervision of building. (I can pay someone to build for me as long as I supervise)

3: A US built amateur built may be imported and registered after 100 hours of flight time.

4: Any powerplant except rockets.

 

New Category - "owner maintenance" Formerly (certain types only) certified aircraft fully maintained by the owner - yes everything! contracting out allowed of course. Not yet allowed in the US as no similar category there yet.

 

Detailed reference docs on these available.

 

/dan

/dan

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Fort Hood Texas..... A good place to be From :D

 

I used to be a professional builder. The FAA does not like us building planes for people - Period. Capital gain is not the idea as stated in the FAR's for homebuilts.

 

After building professionally I must tell you what I have come away with and I am sorry if this seems a little tough but, consider how my oppinion became this way!

 

1.) If you didn't build it, you don't deserve to fly it. (95% of the time)

2.) Builders of airplanes are very different then buyers of airplanes. (95% of the time)

3.) You create a mountain of legal ramifications becoming the manufacturer of a homebuilt airplane. (100% of the time)

4.) I would rather be with a builder/pilot then a buyer/pilot any day. (100% of the time) They are very different people.

 

Repairing for a builder to me is okay or marketing parts or props is also okay. But trying to build an airplane for a person that have more money then sense is a tough row to hoe.

 

Wasn't meant to offend anyone..... rather just enlighten.

 

My current thinking is this; If you have more money then time, buying a certified airplane is the correct answer. If you really enjoy learning and like the mechanical experience and the problem solving of building then homebuilts are for you. Homebuilders are a special breed of people from whom I continue to learn from. ;)

 

- Dale

--

Dale Martin, 509-780-7320

LEZ

Lewiston, ID

EAA Technical Counselor

Owl Eagle Aerial Composites

=====================>

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Per the FAR's the "owner" of an experimetal aircraft may perform any maintanence major and minor, any modifications major and minor. And all this may be done with no notification or approval from the FAA. Its in the regulations.

 

The only item a non-builder owner such as myself may not perform is the "Yearly Inspection". This is not an annual inspection as required for a type certificated airplane, so you only need an A&P to sign it off, IA not required.

 

The EAA website has extensive documentation on this if you require it for your own education or your A&P's.

 

Per another post I have no problem associating with any aircraft owner or pilot, as long as they are polite. We even allow non-canard owners-flyers at our airport!

 

Scott

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>> Scott's comment --

Per the FAR's the "owner" of an experimetal aircraft may perform any maintanence major and minor, any modifications major and minor. And all this may be done with no notification or approval from the FAA. Its in the regulations. <<<

 

Until the owners starts to work on the certified engine (If it is certified). Then the data plate is to be removed - Per the FAR's.

 

We have may liberties in this area. My ex-hanger partner still does his maintanence on his purchased VEZ and LEZ. Never wanting to do it the right way, always the quick way because as he puts it, "I bought this thing to fly - not to work on!"

 

You might guess my feelings..... and why his aircraft is no longer in my hanger.

 

Polite people are welcome here too!

--

Dale Martin, 509-780-7320

LEZ

Lewiston, ID

EAA Technical Counselor

Owl Eagle Aerial Composites

=====================>

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Originally posted by niceez

Until the owners starts to work on the certified engine (If it is certified). Then the data plate is to be removed - Per the FAR's.

/QUOTE]

 

Naw, this is another OWT. Exactly what FAR states this? I've never seen it, and I dought if anybody else has.

 

Scott

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Originally posted by niceez

Until the owners starts to work on the certified engine (If it is certified). Then the data plate is to be removed - Per the FAR's.

Can you clarify this? I'm still looking at the regs, and haven't seen this yet. You're saying your aircraft certified engine becomes no longer aircraft certified once you (the owner) perform maintenance on it. Unless, of course, you're an A&P. That makes sense.

 

Obviously, this would affect the value of the engine. Would this have any impact on the aircraft certificates, such as (but not limited to) airworthiness certificates? Also, could the engine be re-certified at a future date, and by whom? The manufacturer?

 

By the way... Ever try to find info in the FAA documents when you're not sure what you're looking for? I think I have a permanent headache. :D

Evan Kisbey

Cozy Mk IV plans # 1114

"There may not be any stupid questions, but I've seen LOTS of curious idiots..."

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I used to correct and write regulations for the USAF so I had to become familiar with the government ways of doing this.

 

Biggest problem with the FAR's is a single subject can be spread over so many sub-chapters.... They really need to be reorganized. Problem is we have different kinds (if you will) of aviation. As such there are different rules for those individual catagories and often one catagory will be applied to the other. (Mistakenly of course).

 

For our concern we have to focus on everything the falls into Experimental catagory. We are allowed to use certified equipment in our aircraft. However, the equipment -such as the engine- is not a certified installation for use in our aircraft.

 

I wish I had the time to quote the exact regulation to you but if I did that, it seems no matter how correct you are there is always someone out there ready to "pee in your Wheaties" so to speak.

Try this instead;

Go ask Lycoming or Continental what the extent of work a homebuilder with no powerplant rating can do to his engine before they will consider it as needing to be factory rebuilt before returning to the Standard aircraft catagory as airworthy.

 

My thoughts are, you will be astonished.

 

Your have assumed correctly in the value of an engine going way down with no "P" sign off. Most engines (including mine) are worth very little until rebuilt by Lycoming or the man with the "P" rating.

 

Ask yourself if your willing to pay top dollar for an engine with logs that have been maintained by a homebuilder with no A&P rating for the last 1000 hours. They're many homebuilders out there that do a much better job of maintaining an engine then an A&P has time to do but unfortunately, the FAA nor the Engine manufactures see it that way. I think the moderator for C-A was also in engine design for the auto industry. I have to chuckle at what he is thinking when people offer up idea's about different fuels and oils in aircraft engines. All I can say is there is a lot more then meets the eye.

 

Using your computor to copy and paste you find it easier to make your own book of what is and is not legal with amatuer building and maintanenece.

;)

--

Dale Martin, 509-780-7320

LEZ

Lewiston, ID

EAA Technical Counselor

Owl Eagle Aerial Composites

=====================>

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See what I mean! :confused: You won't take advise not even from someone who has put 11 planes through amateur construction and certification process.

 

Why don't you call your local FSDO office for help on this subject. I know it's enough for me.

:o

--

Dale Martin, 509-780-7320

LEZ

Lewiston, ID

EAA Technical Counselor

Owl Eagle Aerial Composites

=====================>

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Having just sold an experimental airplane I built, here is what I learned about the legal aspects of the sale.

 

1. The builder can not escape the potential liability of having built the airplane. Liability waivers are held "not in the interest of the public" and are not worth the paper they are written on. The waiver is somewhat of a barrier from the buyer, but none at all from third parties, like his wife or children.

 

2. The wording of a contract can make it difficult to file suit, but if money is sniffed out by a lawyer, he will go for it. If the builder has nothing, he is not likely to be sued. If he committed fraud or gross negligence, he could go to jail.

 

3. Selling parts is slightly less risky than the whole airplane.

 

4. The FAA has no interest in the buying and selling experimental airplanes except that they be properly registered. Maintenance is cut and dried. The annual condition inspection must be signed off by the original builder (if he holds a repairman certificate) or an A&P.

 

5. It is possible to recertify an experimental airplane from parts with the new owners name on the data plate. Whether or not that person would be eligible for a repairman certificate is unknow.

 

dd

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