Is buying used the best Option?

http://www.thetruckersreport.com/truckingindustryforum/posts/5196739/

I went through a similar thought process starting up 16 months ago, and echoed many of your thoughts.

Business credit was near impossible, even with 800+ credit and a 10 year bank history with 400k of loans - no business history = no loan.

My aim was a glider too - Fitzgerald/Andersons - or even my shop will build one. It's the rolling chassis that bothered me - how long will stuff last?

2001 KW T2000, N14 - 963,000 miles - $12,500. Now, 135,000 miles later - there's $20,000 cash from running it that could be used for inframe or deposit. I spent $30k in maintaining that truck last year, new tires, injectors, rods and mains, oil changes . . . this year less than $3,000.

I'm addicted to the lack of payments, zero. It means one less 'boss' on my back, because believe me, owning a truck doesn't mean you get to goof off a whole bunch.

The rest is in a thread I started - pretty lengthy now, but a lot of numbers in there if you get time. (Link above - just scroll back)

Remember - relax. You're still young.

 

Showing W-2 and 1099 income in the same year is not a big deal. Very common. You just have to fill out an extra form called Schedule C "Statement of business profit and loss" for the 1099 income. I just did it for 2015 myself for the taxi driving I also did during the year.

Unless you have a solid gig lined up with your current carrier to keep you moving I wouldn't be going out and buying $113k trucks although I know the "shiny object" allure is strong. Bank probably wont be game to give you $100,000 anyway unless you have a solid business track record to show them, which you don't. If you want to be an independent owner op and start from scratch with no carrier to lease on to and just work the load boards I would suggest saving more money for another year or two and buying something older with cash and go rent a trailer from Premier leasing or something. Ideally you want 4-5 years of industry experience so you can make all your rookie driving mistakes with somebody else's equipment.

 

Cool thread. Please keep us updated. Like the OP, I have no mechanical aptitude either. I think diagnosing the problem is the hardest part. After that, most parts can be replaced with DIY and YouTube vids.

My plan is to buy a used truck early next year for about $50K max, and then an extra $10K in upgrades. The election will be over and I'll have some extra cash from my tax return. I went and looked at some pretty new aerodynamic Petes (I.e. like TMC uses) and they were $150K! No thanks.

 

Blair do you think that you're next truck will be a glider? Or will you just overhaul the T2000?

 

Really split in between on that question. There's some manufacturers boo boos in that truck that prevent me from seeing it as feasible in 5 years time.

Yet, I know it pretty well now, and have most bases covered.

 

Having owned truck for many years, I would advise against going out and buying a new truck when starting out. The economy is not doing that well and those big payments come around whether you are moving or sitting at home and whether there is freight or not. I usually recommend that anyone thinking of buying a truck for the first time to buy a decent used truck and either pay cash or have enough of a down payment to have small payments. When you have low or no payments, you can afford to sit and wait for a good paying load rather than running to pay the payments. Let your business pay to upgrade to a new or newer truck when you can pay more money down or just save until you can pay cash. It is very important to have sufficient reserves to do a rebuild or pay for a major breakdown. It will happen at some point. Too many new owner operators get into trouble by starting out with more truck than they can afford. When the economy is soft it is easier to keep the doors open when you are not concerned about making your payments or paying the bills. There are some good used trucks around you can buy for less than $20,000. I know a guy who recently old his Century for $11,000. The truck was in perfect working order with a new set of tires and aluminum wheels. He just decided to sell the truck and change careers. I know another guy who works on trucks and usually has something to sell. He usually prices his trucks for less than $20,000. He goes through them and repair whatever is broken or not working properly. There are good deals around if you are patient.

 

Sometimes stuff happens, I wouldn't be to worked up over something as simple as an alternator.