Problem is that you can't separate the financing from the compensation. I know of several good deals on leases but when you put it with the pay it becomes almost un-workable.
First thing, make sure that you have a set buy-out value at the end and not "Market Value". Anything that is market value should be considered a rental.
Next, look at what they are leasing. If you are getting a 500K truck and you have to drive team to make it work then you are going to have a very high mile truck when completed. Not the worst thing because if you are smart of the first part you will have some equity.
Then, build a true operating budget. If you find that you are have to figure out ways to make extra revenue to make it work then it won't work.
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Discussion in 'Lease Purchase Trucking Forum' started by BlackCloud75, Jan 2, 2014.
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Neither purchased the other it was a merger.... and pretty hostile towards greatwide... -
What was cardinals main account,Home Depot? Lowe's?
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Not always true,but something to think about and clear up in advance.
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I don't think I've ever seen so many deleted posts on a single thread. Now I can't stop wondering what they said.
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While I would never do a lease purchase myself because well they do not call them a fleece purchase for nothing, if you are going to go that route there are some things you need to consider.
First of all it is what is the duration of the lease and is there a buy out option, is there a penalty with that buy out option? Meaning if you pay off the truck early is there a penalty?
Then you need to look at the numbers. How much you can make a month verses how much the monthly payment on the lease is. After fuel tires and maintenance, how much is going to be left for you?
I have seen so many drivers get into a lease purchase and they are so proud that it is "their truck" that they are working for free so they an have their own truck. In the end the math needs to stack up or you will be hating life.
The reason I mentioned earlier about the buyout on the lease is this, when you look at leasing to a company you are going to be married to that company for the duration of the lease be it four, five or six years. Are you going to be happy being with that company that long? Can you count on them treating you well for that duration of time?
Having the ability to pay off your truck via getting a conventional loan is a good thing to consider doing so if things with that company are not going well you can pay off your lease and take the truck that now belongs to you and the bank to another company.
As well before you buy a truck from a company this way you really should try running with them first as a company driver and see how they treat you, and how well you like them. Just signing on hoping to buy a truck through a lease purchase and hoping to get a good dispatcher, that is leaving one heck of a lot of variables and opportunities for things to go wrong leaving you losing a lot of money, time effort and the truck you were hoping to gain.
Then once you have looked at these factors and looked at the numbers you need to take another look at it and see are you better off paying for their truck for the next few years, or would you be better suited working your butt off in a company position for the next year to a year and a half and saving up 25-35 grand and paying cash for your own truck. Sure a truck in that pice point is going to need things, but you will own it from the get go instead of chasing your tail.
Finally after all of that if you decide you want to sign on the dotted line, you need to take that lease to an attorney and have them look at it and give you their advice on it.6 Speed Thanks this. -
The buyout may not be so important if you get into a new truck with no money down. You won't have any equity in that truck for years. There are some companies out there with "walk-away" leases, JCT is one of them, where you can turn in your truck like a company driver if you decide that leasing isn't for you.
If you want to see what leasing is like, take a look at my thread:
http://www.thetruckersreport.com/tr...ing-company-here/219180-running-with-jct.html
I have posted my ongoing trials with JCT with all the ups and downs. Readers can see the miles that I get and see real-world numbers showing my profits and expenses. Leasing has worked out well for me, but it isn't for everyone. There are so many who fail, even with a good company, because they can't stop thinking like company drivers. Good luck on your research!RizenPhoenix Thanks this. -
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