Successful Aircraft transactions are not an accident, why third-party escrow—with AIC Title—prevents avoidable pitfalls for buyers and sellers
If you only read one guide before you buy or sell an airplane, make it this one. It’s the practical, contract-driven playbook we use every day at AirSpace.
TL;DR (for busy aviators)
- Moving money or documents directly between buyer and seller invites delays, disputes, and outright fraud.
- A specialized aviation title & escrow company (we use AIC Title) sits between the parties, holds funds, validates documents, files with the FAA, and only releases everything when the contract says so.
- Result: a clean, orderly closing that protects both sides and keeps your transaction on schedule. AOPA Finance+1
Who this is for
- Aircraft buyers who want a safe, easy way to buy a plane for less hassle and maximum confidence.
- Aircraft sellers who want to sell a plane for more, with clean title, correct paperwork, and no games.
- Owners, brokers, lenders, and flight departments who prefer a predictable, audit-ready process.
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Why escrow matters in aircraft sales
Unlike a car, an airplane’s value hinges on paperwork, liens, and filings as much as the machine itself. Third-party escrow keeps the deal contract-driven: money is verified, documents are vetted, title is searched, FAA forms are filed, and nothing is released until all conditions are satisfied. Lenders often require it for exactly this reason. AOPA Finance
What AIC Title does (and why we use them)
AIC Title is a long-standing aviation title and escrow firm in Oklahoma City—steps from the FAA Civil Aircraft Registry—focused on title searches/reports, escrow, lien releases, FAA document submission, registration, and transaction management for domestic and international deals. They’ve handled 125,000+ title searches across 150+ countries in 30+ years. Business Jet Traveler+2aictitle.com+2
In practice, that means AIC Title will:
- Open escrow and hold buyer funds in a safeguarded account per the purchase agreement.
- Run title searches, surface recorded liens, and coordinate lien releases.
- Prepare/verify FAA documents (e.g., AC Form 8050-2 Bill of Sale) and file them correctly.
- Coordinate with both sides (and lender, if any), then release funds and documents simultaneously at closing. aictitle.com+2AOPA+2
Bonus: Reputable escrow teams use multi-factor verification and secure data rooms to cut down on wire fraud and status confusion—everyone sees milestones, and funds only move after formal verification. Aviation Week
Five common failure scenarios (and how escrow prevents them)
1) Direct wire → no transfer
Problem: The buyer wires funds directly to the seller “to move fast.” The seller delays or refuses to execute the FAA Bill of Sale (AC 8050-2). No document, no ownership change; the buyer is stuck chasing paperwork.
What went wrong: No neutral party conditioned the funds release on delivery of signed, recordable documents.
Escrow fix (AIC Title): Funds sit in escrow. Seller’s executed 8050-2 and other deliverables are verified first. Only then are funds released and the FAA filing executed. Federal Aviation Administration+1
2) Airplane released before funds clear
Problem: The seller hands over the airplane on the strength of a “confirmation screenshot.” The wire is reversed/never arrives; the aircraft is gone.
What went wrong: No confirmation of collected (cleared) funds.
Escrow fix (AIC Title): They confirm good funds before releasing any document instructions. The airplane and documents don’t change hands until money is verified and contract conditions are met. AOPA Finance
3) Spoofed email / fake wiring instructions
Problem: A hacker inserts bogus “updated” wiring instructions. Buyer wires a large sum to a criminal’s account.
What went wrong: No multi-factor verification of payoff/escrow instructions.
Escrow fix (AIC Title): Enforced procedures: call-back verification, secure portals, and documented workflows to validate account details before funds move. Aviation Week
4) Hidden or old lien surfaces after “closing”
Problem: The buyer discovers an undischarged lien weeks later. The aircraft cannot be cleanly registered or financed until a proper Lien Release (e.g., FAA 8050-41) is recorded.
What went wrong: No professional title search and lien clearance before money changed hands.
Escrow fix (AIC Title): Title search up front; lien payoff and recorded release coordinated prior to closing so the buyer receives clean title. Business Jet Traveler+1
5) Paperwork errors stall registration
Problem: Names don’t match the current registration, signatures are wrong, or the 8050-2 isn’t prepared in duplicate originals. The FAA rejects the filing; flying and insurance complications follow.
What went wrong: DIY paperwork didn’t meet FAA recording requirements.
Escrow fix (AIC Title): They validate names/ownership, prep correct forms, and submit to the FAA properly. (Example: 8050-2 needs two originals; one is filed with the registration, one is retained.) AOPA+1
DIY vs. using an aircraft broker vs. using escrow (and why smart sellers do both)
- DIY Private Sale: Lowest service level. You shoulder title research, lien releases, FAA filings, funds verification, and closing choreography.
- Aircraft Broker (AirSpace): Markets the airplane, qualifies buyers, negotiates the contract, coordinates pre-close deliverables, and keeps momentum.
- Aviation Escrow/Title (AIC Title): Independent funds holder + documentation specialist that ensures money and documents move together under the contract.
Best practice: Use a broker to drive price and terms—and use AIC Title to make the exchange clean, compliant, and hassle-free. That combination is the best way to sell a plane (for more) and the easy way to buy a plane (with fewer headaches). AOPA Finance
The contract-driven closing checklist (what “good” looks like)
- Purchase agreement with clear milestones and closing conditions.
- Open escrow (AIC Title). Share fully executed contract and identities.
- Title search + lien payoff plan established early.
- Document pack prepared: AC 8050-2 Bill of Sale (two originals), registration, supporting docs (trust/company papers if applicable). AOPA+1
- Wire instructions verified via call-back/MFA—no email-only changes. Aviation Week
- Good funds confirmed in escrow.
- Simultaneous exchange: AIC releases money to seller and files/submits documents to the FAA per the contract.
- Post-close packet and filing confirmations delivered to buyer; seller receives proceeds and payoff confirmations.
FAQ (quick hits buyers and sellers ask)
Do I really need two originals of the Bill of Sale?
Yes. and no. When using a third party escrow a digital signature will be used and no ink is required. When signing in person and not using an escrow service, both originals go to the buyer; one is paired with the registration and sent to the FAA, the other is retained. AOPA
Can I just Venmo the seller and pick up the plane?
Please don’t. Use escrow so good funds and recordable documents exchange together. AOPA Finance
What if there’s an old lien from a prior owner?
AIC Title coordinates the correct lien release form and FAA recording—before closing. General Aviation News
Common red flags in private aircraft sales
- “Let’s skip escrow to save time/money.”
- “Use these new wiring instructions we just emailed.”
- “We can sign documents after funds arrive.”
- “The bank payoff is ‘in process’—go ahead and wire now.”
- Inconsistent names between registration, bill of sale, and corporate documents.
- Pressure to release the airplane before funds clear.
How we (AirSpace) run a clean, easy transaction
- We negotiate fair, documented terms so buyers can buy a plane for less hassle and sellers can sell a plane for more value.
- We coordinate inspections, deliverables, and timing.
- We close through AIC Title so money and documents move together in a consistent, contract-driven way.
Education first. When consumers understand how a proper aviation escrow works, they choose it—every time.