As a requirement of aircraft ownership in the US, you must register your airplane with the Federal Aviation Administration (FAA). It is not a difficult process, and there is helpful information available on the FAA website. It is, however, an important process for a few reasons. One is simply that it is a legal requirement for all owners to register their aircraft and to have the registration onboard the aircraft.
The FAA makes that clear in Federal Aviation Regulation (FAR) Section 91.203, which states:
Except as provided in Sec. 91.715, no person may operate a civil aircraft unless it has within it the following: (1) An appropriate and current airworthiness certificate. Each U.S. airworthiness certificate used to comply with this subparagraph (except a special flight permit, a copy of the applicable operations specifications issued under Sec. 21.197(c) of this chapter, appropriate sections of the air carrier manual required by parts 121 and 135 of this chapter containing that portion of the operations specifications issued under Sec. 21.197(c), or an authorization under Sec. 91.611) must have on it the registration number assigned to the aircraft under part 47 of this chapter. However, the airworthiness certificate need not have on it an assigned special identification number before 10 days after that number is first affixed to the aircraft. A revised airworthiness certificate having on it an assigned special identification number, that has been affixed to an aircraft, may only be obtained upon application to the responsible Flight Standards office. (2) An effective U.S. registration certificate issued to its owner or, for operation within the United States, the second copy of the Aircraft registration Application as provided for in § 47.31(c), a Certificate of Aircraft registration as provided in part 48, or a registration certification issued under the laws of a foreign country.
Another reason for registering an airplane is that insurance providers use the FAA registration information to confirm that they are providing coverage to the legal owner of the aircraft. In addition, if lawsuits are filed as a result of an incident, the insurer needs to confirm that they are assisting in the defense of the legal owner.
If the owner’s information on the insurance policy and FAA record don’t match, claim defense and payment for damages may be delayed.
Addressing Old Liens
Another potential issue related to aircraft ownership is the existence of liens on the aircraft. As Merriam-Webster defines it, a lien is “a charge upon real or personal property for the satisfaction of some debt or duty ordinarily arising by operation of law.”
Common sources of liens on aircraft are liens for initial financing for the aircraft purchase, as well as liens for repair or upgrade work that is performed. The individual or organization that does the work may have a lien on the aircraft until they are paid for their services. If a claim is filed, the insured is responsible for providing a clear title to the aircraft, or having the lienholder included as a payee on the loss payment.
Should liens be discovered, their existence can have a negative impact on the settlement process, as additional time and effort on the part of the owner is required to clear them. This must be taken care of before the insurer will pay for repairs or a total loss. If not properly removed from the FAA data base, liens can be decades old, with the aircraft having passed through multiple owners since the inception of the lien. With bank mergers, the creditor bank with the initial lien may have merged, the merged bank may have merged, etc., presenting a challenge in even identifying the bank that has the authority to release the lien.
For this reason, it is important to do a title search as part of the pre-purchase process when buying aircraft. In that way, liens can be identified and the current owner of the airplane can be required to resolve them before the sale is completed.
FAA Re-Registration Requirement
Since October 1, 2010, aircraft owners have been required to renew their aircraft registration every three years. Failure to do so can result in the FAA canceling the N-Number of the aircraft and all of the administrative issues that result—issues that are particularly unfortunate in light of the fact that the registration renewal fee is negligible ($5 at the time of this article) and the renewal process is very straightforward.
Aircraft owners receive renewal notification from the FAA 180 days before their current registration is set to expire. This notice informs the owner that they have a three-month timeframe in which they can log onto the FAA website and renew the aircraft registration using a code included in the notice.
If the process is not completed online within the three-month window, the owner must fill out a paper form and mail it to the FAA Registry in Oklahoma City, and the form must be on file with the FAA before the current registration expires. Given the potential fluctuations in USPS delivery times and other factors, owners should use the online renewal option if possible, and if not, mail their form well in advance of the deadline.
Another Crucial Action: Returning an FAA Aircraft Registration When You Sell the Aircraft
Just as important as registering an aircraft and renewing it as required is informing the FAA that you are no longer the owner of an airplane after you sell it. Immediately after you close on an aircraft sale, you should remove the Certificate of Aircraft Registration.
Sometimes called the “permanent registration” or “hard card,” it is officially known as AC Form 8050-3 and should be received by the FAA within 21 days of the sale. To return the form, you provide the necessary information on the back, sign it, and mail it to the FAA using the address on the form.
Information on returning AC Form 8050-3 and other issues related to aircraft registration “duration and return” such as reasons that a registration might be revoked, canceled, transferred, etc. can be found in the Code of Federal Regulations online.
Be Proactive: Review Your Aircraft Registration Today
Given the legal and aviation insurance ramifications of failing to register or renew an aircraft, it is a good idea to check on your aircraft registration status periodically. Doing so can help you avoid the time it takes to resolve issues during the claims process and will also give you peace of mind.
You can do that efficiently by performing an N-Number inquiry. If your search leaves you with questions about the status of your registration, you can contact the FAA Aircraft Registration Branch at 1-866-762-9434.
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