Updated September 02, 2026
Quick answer
Part 91 is private carriage; Part 135 is commercial operation for hire, and it carries a heavier maintenance and inspection regime plus different insurance. Lenders care because both change the cost of ownership — and because owners who plan to offset costs with charter revenue usually find that projected utilization is discounted heavily.
What the Distinction Actually Is
Put simply, Part 91 covers general operating rules for private flight; Part 135 governs commercial operations carrying passengers or cargo for compensation.
The regulatory detail is the FAA's rather than a lender's, and the FAA handbooks and manuals are the place to establish what applies to you. What matters here is the financial consequence, which is considerable.
Flying for hire brings a stricter maintenance and inspection regime, additional operational requirements, and insurance written for commercial exposure. Each of those raises the cost of ownership, and the cost of ownership is what a lender is underwriting alongside the asset.
What Changes for the Lender
| Part 91 | Part 135 | |
|---|---|---|
| Use | Private carriage | Commercial, for compensation |
| Maintenance regime | Lighter | Heavier and more frequent |
| Insurance | Private cover | Commercial cover, higher limits |
| Utilisation | Usually low | Higher — more hours, faster wear |
| Revenue in the file | None expected | Present, and discounted |
| Operating cost | Lower | Higher |
Higher utilization cuts both ways. It generates revenue, and it consumes the airframe and engines faster, which brings the overhaul cost forward — something the term should reflect.
Why Charter Revenue Gets Discounted
This is the expectation that most needs correcting.
Owners frequently plan to place an aircraft on a charter certificate and let the revenue offset the payment. It is a reasonable plan and it sometimes works. Lenders discount it heavily anyway, for a defensible reason: projected charter utilization is a forecast made by the person who benefits from it being optimistic, in a market that moves.
The practical rule to apply to yourself: build the case on what you can carry without the charter revenue. If the payment only works at projected utilization, the structure has no margin for a soft quarter — and a soft quarter in charter is not unusual.
Where you do have a management agreement with a documented history, bring it. Actual booked revenue on a comparable aircraft carries far more weight than a projection.
Changing Basis After You Buy
Worth flagging because it catches people out and the consequences are contractual rather than merely inconvenient.
Moving an aircraft from private to commercial operation after closing can breach both the loan terms and the insurance policy at the same time. Loan documents commonly specify the permitted use, and insurers price on the basis they were told about.
If there is any chance the aircraft will go on a certificate later, say so at application. Getting it written in is straightforward; retro-fitting it after a policy has been issued and a loan drawn is not.
Which Basis Suits the Purchase
The financing consequence should not drive the operational decision, but it belongs in it:
- Genuine private use is the simplest to finance and the cheapest to own. If the flying is for you, keep it simple.
- Commercial operation as the business is a straightforward proposition if there is real, documented demand — it is a business being financed, not a lifestyle asset.
- Private use with charter to offset costs is the hardest case, because the file depends on revenue the lender will not fully credit. Expect to carry more of it yourself.
Frequently Asked Questions
What is the difference between Part 91 and Part 135?
Part 91 covers general operating rules for private flight; Part 135 governs commercial operations carrying passengers or cargo for compensation. Part 135 brings a heavier maintenance and inspection regime and commercial insurance, both of which raise the cost of ownership.
Does operating basis change my loan terms?
Yes, mainly through cost of ownership and utilization. Commercial operation means more hours, faster wear and an earlier overhaul, which a lender reflects in the term. Insurance and maintenance costs are higher too, and both sit in the affordability assessment.
Will a lender count my charter revenue?
Partly, and usually with a heavy discount. Projected charter utilization is a forecast made by the party who benefits from optimism, in a market that moves. Documented revenue under an existing management agreement carries far more weight than a projection.
Can I put the aircraft on a certificate after I buy it?
Only if the loan and the insurance permit it. Loan documents commonly specify permitted use and insurers price on the basis they were told, so changing after closing can breach both at once. Say at application if it is a possibility.
Which basis is easier to finance?
Private use, clearly — it is simpler and cheaper to own. A genuine commercial operation with documented demand is also straightforward, because it is a business being underwritten. The hardest case is private ownership relying on charter income to make the payment work.
Sources & Further Reading
- FAA Handbooks and Manuals — Federal guidance on aircraft operation and maintenance, including the inspection regimes that differ by operating basis.
- FAA Aircraft Certification — Federal airworthiness and certification requirements - the framework behind logbooks, airworthiness directives and the records a lender expects.
- CFPB Small Business Lending Research — Research and rulemaking on business credit disclosure, including how cost is presented to borrowers.
Figures above describe ranges commonly seen across lenders and reflect published guidance as of the date on this page. Confirm current terms with the cited source or your lender before acting.