BEST LEASE PURCHASE??? (to head me towards ownership)

Discussion in 'Lease Purchase Trucking Forum' started by Wolfen666, Nov 13, 2012.

  1. Wolfen666

    Wolfen666 Bobtail Member

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    Well, as many owner operations have done, I am looking to sign a lease purchase contract that will eventually put me with my first owned truck and open the doors for me to become independent as a trucker and get away from the dreaded "dispatchers" and 10-15% load pay. I have been looking at a lot of companies that offer lease purchase programs, but it is very hard to get straight answers out of recruiters that know the answers I want will probably get me to decline them. lol

    Basically, I would like to know which companies all of you have found to be fairly good for a lease/purchase program or rather at least decent enough to suggest.

    I am sick of being a company driver, and think a lease/purchase will give me the added experience and knowledge to eventually become a successful O/O.

    My only requirement as you suggest companies is they allow a pet in the lease/purchase truck, the truck has an APU, and has no more than 100,000 miles and doesn't exceed a 400,000 mile lease/ purchase agreement or 4 years.

    Essentially I intend to just sell the truck and use its value as a down payment on a new, dependable truck.
     
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  3. ronrdrcr

    ronrdrcr Light Load Member

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    That sounds like a really good deal if you happen to find anything that fits your needs, you might want to keep it a secret...lol

    Ron
     
  4. OhioHotshot

    OhioHotshot Light Load Member

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    Yeah good luck with all those stipulations for mileage before and after your lease ends, your talking practically a brand new rig = high weekly payments which will result in lower take home and the need to run the max allowed miles each week, but your not going to be able to get those miles consistantly, u might wanna consider a well taken care of old rig with some miles one it to lesson that payment starting out.. And lean toward a more fuel efficent tractor instead of a long hood tractors which don't get the best mileage.. Just food for thought. Apu r good ideal to save on idiling...
     
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  5. Oscar the KW

    Oscar the KW Going Tarpless

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    If you are only making 10-15% now I can see why you hate being a company driver, I would to if part timers at McDonalds where making more than me. The reason you are not getting straight answers out of recruiters should be a sign, this is not going to go well for you. Why do you think the gateway to becoming an owner operator, independent or not, is thru a lease purchase? I bet more than 98% of owner operators that are successful did not do a lease purchase from a company.
     
  6. gokiddogo

    gokiddogo Road Train Member

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    What are your reasons for wanting to be an owner-operator? So that you can bring a pet in the truck with you? The only reason one should decide to own their own truck is so that they can make MORE MONEY. Otherwise, why take on the risk of breakdowns and maintenance and everything? In the end, greater risk must = greater reward. Only a fool would buy a truck so they can "go where they want to go" or drive extra fast or idle all night or bring a pet or whatever else. Take a closer look at why you are so sick of being a company driver. Is the pay very low? Do you feel you are not spending your time wisely while on the road? Do you generally get treated like dirt? Is the equipment sub-standard?

    The reason to buy a truck or not needs to come COMPLETELY from the numbers. You need to know exactly what your truck will cost to run. These costs should be broken down to by the mile, costs such as fuel, oil changes/grease jobs, money aside for maintenance, and tires. You also have monthly expenses which are hard to figure out per mile because they are based on time. The difference in mileage from month to month will vary it per mile, but the dollar amount will stay the same. These are truck payment, insurance, trailer payment, all taxes. You also need to know how much you expect to gross per mile and per month. If you haven't figured this out (there are many many ways to figure the costs out, you will find) then if you hop into a truck before doing this you are doomed from the start. Never forget to pay yourself at least the same as what you figure the going rate for your driving services to your company is worth. Also - when you do start this venture, look EVERY MONTH at the money you are making and where you are spending it. Look at monthly MPG averages, and percentages as to where your income is going. If you don't know these numbers you could be slowly going broke and not even know it.

    When you do decide to get your own truck, do NOT do a lease purchase through a company. What is going to happen when you have 12 payments left to own it and the freight suddenly "slows down" ? You can't take that truck to another company and sign it on there. What happens when you have to give that truck back, and now you have just worked 3 years and have nothing to show for it. Get outside financing. Save up 50 grand clear in the bank, then go spend 30k on a GOOD truck (not necessarily new) and have 20k left in the bank for "in case" money. This assumes that you will be signing it to a company who will cover your fuel while waiting for payment. If you are going to cover your own fuel, add another 20k. If you are going to run your own authority you will have some down time between where you will sit and when you can roll again. You will need to cover your monthly payments still. Add more money. Hope this helps.
     
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  7. BigBadBill

    BigBadBill Bullishly Optimistic

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    Out of the moths of babes.

    You will not find a Lease PURCHASE with the terms you are describing. Reason being is that because of the costs of the trucks the companies have to lease the trucks with a residual at the end. Todays terms are typically fair market value, So when you are done you have the option to walk away or pay the highest level of retail they can justify (plus a little extra).

    Other side that you are off on. In todays lease market, you have to run till it hurts then run a little more. People who are successful in leases understand that this is a completely different business model than being an O/O. You have high expenses, low rate of pay and those create thin margins. Only way in this game to create better margins is with miles to thin out the fixed overhead.

    So you have to look at averaging 140,000 miles a year and not 100,000.

    BTW, few O/O's have become O/O's via the L/P route. Most do it by being disciplined company drivers, educating themselves on how to run a truck, saving and buying a truck.
     
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  8. G/MAN

    G/MAN Road Train Member

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    I don't know of any really good lease purchase programs. For you to get the truck you noted you are essentially talking about a new truck that will cost around $150,000 and that doesn't include any interest. You can expect to pay a weekly lease payment of around $650-800. In addition, you will have a mandatory maintenance account. The reality of leasing a truck is that you will do good to make drivers wages. Few lease operators actually complete their leases and get the title. When you lease a truck, you are not really taking any risk. The carrier assumes the risk and will be paid for their potential loss.

    Lease purchase is one of the most topics on this and other trucking forums. You would do much better if you saved your money for a good down payment and bought your truck. I would not recommend starting out with a new truck or one with such low mileage. There is much to learn about how to run a successful trucking company. You should not spend more than about $20,000 to buy your first truck. There are bargains around. if you are willing to spend the time and put forth the effort. If you own the truck and the carrier agrees, you can take your pet in a truck that you OWN or are buying. Not all carriers will allow pets, even if you own the truck. There is a lot of potential liability for the carrier. Some shippers will also not allow pets on their property.

    You only have 1 year experience in this business. Have you saved any money during that time? You should be saving something out of every paycheck. You could save enough in a couple of years to pay cash for a good used truck. If you want a newer truck, you could use that money for a good down payment. You need to look at this as a business. If your primary desire is to be able to take a pet in the truck, there are carriers that do allow pets. Being able to take a pet along is not a good reason to buy or lease a truck.

    CRST Malone has one of the better lease programs that you can own in a couple of years. I don't recall if they allow pets. I have owned trucks for many years. There is no easy way to get into truck ownership. Leasing from a carrier is not a good idea. There are those who lease trucks from Swift, Dart and others. Reviews are mixed. Most will fail.

    There are legitimate leasing companies that will lease trucks where you own the equipment when you make the last payment. Going through a leasing company usually means that you will have a lower payment than if you lease from a carrier. Leasing from an independent leasing company also enables you to take the truck anywhere you wish. Few drivers stay with a carrier for the length of time required to complete their lease with the carrier. If you lease from any carrier you will need to either buy out the lease or leave the truck, should you decide to leave.
     
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  9. Pedigreed Bulldog

    Pedigreed Bulldog Road Train Member

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    First off, 10-15% load pay is HALF of what a company driver ought to be making...so if that's all you are getting paid, I can understand your frustration.

    Second, a lease purchase is NOT the way to become an O/O. You don't "own" the truck, and chances are you never will. Across the industry, I've seen numbers as high as 95% failure rates for those lease purchase "deals". Why? It isn't in the company's best interest to ever let you get the title to that truck. First, they will run you ragged in order for you to stay on top of the payments, fuel, insurance, tags, maintenance, repairs, etc....so that even if you DO somehow manage to complete the lease, the truck is wore out and won't have much value as a trade-in. Then, if they don't want you to complete the lease, they can start cutting your miles....make you sit just a little longer between dispatches...give you more short runs....so that money tightens up. Ever receive a negative paycheck? Entirely possible with a lease-purchase...because the company is going to take what is due to them before they pass any money on to you.

    Third, you don't own the truck...the company does. Do you realize how many companies take out loans on trucks they have contracted out through lease-purchase plans? If the company defaults on that loan, the bank repossesses "your" truck, and there isn't a #### thing you can do about it because it isn't your truck. Even if you DO complete the terms of the lease, the bank still holds that truck as collateral (meaning you won't see the title) until the company finishes repaying the loan or refinances it without the use of "your" truck as collateral.

    If you want to be an O/O, save up some money and put a down payment on a truck....or save up a lot of money and just buy one outright. Make sure YOUR NAME is on the title from day 1....otherwise it isn't (and most likely never will be) YOUR truck.
     
  10. snowwy

    snowwy Road Train Member

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    why don't you all just get to the point. since these type of threads pop up OVER AND OVER.

    your living in a dreamland.

    no such thing exists.

    now if you want to rent the truck. by all means. knock yourself out. and as long as you go without spending ONE PENNY during the term.
    you just might actually have enough for that balloon payment to buy that truck when the term expires.

    but most rental contracts aren't geared for ownership anyways. although some would come along and say otherwise. and that they are doing really good.

    they've never been around to be heard from after the halfway mark.
     
  11. Hanadarko

    Hanadarko Independent Owner/Operator

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    Don't lease. Don't EVER lease.
    Now with Obama still in...I would expect many things to change in this industry and not for the better...

    Save Save Save and then buy used. If you can't save, then you already have a bad start at this.

    There is nothing prouder than being able to say you're a REAL O/O..one that actually OWNS their own rig outright and no
    one can take it away from you. Hell you can back it up against a fence and park it if you want.
     
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