Credits no good, this is why people are tempted to do lease purchase

Point blank whether you go and buy a truck from the outside or do one of the better lease deals... If you don't have the mindset that you're running a business you're gonna fail...

You have to get rid of the company driver mentality and get into the business mad mentality or you're done from the start and that's one thing I've seen with a lot of people...

I run across so many people ask them how much is your bottom line operating cost and they don't even know what I'm talking about..

If you don't even know what your bottom line operating cost are combined with what your cost are at home then you have absolutely no idea what your minimum that you can even run for...

 

I leased because I had no credit, no savings and didn't want to own a truck anyway. So far I've paid off about 15k in debt, raised my credit 200 points, and have substantial savings. A successful lease is 1 part carrier, 1 part you. They both need to be right for a lease to work out, as mine does.

 

Thanks for all that info. Since I am a rookie who still needs a year first. Any advice getting to where you are at? Obviously leasing with a mega carrier seems to not be the answer. So save up as a rookie and then buy my own used truck? I see a lot older models out on the roads

 

Buying a truck today is easy. Most commercial loans are looking at years in business first and I'd say at least 5 years in business if less than that your looking at a very high rate on your deal. My first commercial loan was around 33%. Your FICA will play a small part in the decision as well as they want to see how you pay your bills. I have used North Mill Credit out of Connecticut for my last 3 truck purchases. If you have a FICA of at least a 600 and a 20% downpayment a $500 docs fee to lender you will get the financing you looking for. Don't be scared to apply, their inquiries are soft inquiries basically the same as a pre employment one would be.

 

If they look at your credit score it will be a hard inquiry. They are going to pull up all three credit reports and I believe that that will have a greater impact on the decision-making then how long you have been in business.
You could have been in business for the last 20 years but if you haven't done a good job of paying your bills it's not going to hold much weight. If it were me I would make sure that I had my personal life in order as far as building an escrow account and paying bills on time for at least a couple of years. Once you can prove to yourself that you're capable of putting money in the bank and keeping it there eventually you will have you're 20% down. If you don't have a decent chunk put away in some kind of savings account and have a good credit score prior to applying for a commercial loan I would say that those are two red flags and pretty good indicators that you are not going to be successful as an owner operator.

 

Well with my 1st truck they wanted my Profit and loss statements showing in business for at least 5 years back.Your wrong about the hard inquiries though. They did a soft inquiry on mine it shows all the same stuff that a hard inquiry does difference is that a soft inquiry is designed for those companies that require a credit report to be pulled for employment purposes so it does even show on my credit report. Yes most lenders do hard inquiries to make a decision on credit worthiness but this was my experience with the Lender I've used for the last 3 trucks I've bought. I've been driving since 1982 been an O/0 for more than half of the time. As I said time in business along with a decent FICA score and a decent downpayment at least 20%. A friend of mine got financing thru same lender as I went through he only had 3 years in business and a FICA score of a 600 (divorce killed his score) they financed his truck but his downpayment is what made the deal go thru with 28% down. A healthy downpayment limiting the lenders liability can exonerate you from past credit sins.

 

I know a lot about credit because I had to rebuild mine but I've never really owned my own truck. I haul cars and for me to invest into a brand new truck and trailer which would probably be the only way i would go we're talking $300,000. 20% of that would be $60,000.
That would be a very big commitment. And I'm not sure if I'm ready for a commitment like that.
I'm turning 60 this year and started out here in 1980. But I'm not ready to retire anytime soon either.

 

You and me both Mooney. I'm 55 and I'll keep at as long as I can. This will be the last truck that I ever buy short of something terrible happening to it. I got a sweet deal on my 2014 Peterbilt 579 from Wisconsin Kenworth at $48,000. Lender told me 5% down but I put alot more down than that like $7,500 (aprx.15-16%) and I already have established commercial credit plus the Premium 2000 1 year 100,000 mile engine warranty with turbo, injectors, ecm, water pump. Transmission and Aftertreatment warranty (Which I've already bypassed that was $7,100). The warranty was an additional $4,000. It takes alot of cash out of pocket to buy and get a truck on the road.
Downpayment
After market warranties
Lender Fees
Sales Tax (NC is .03% of purchase price)
Titling Fees
2290 Heavy Road Use Tax
Apportioned Plate Fees
Bobtail & Physical Damage Insurance
Gap Insurance if you buy a truck for more than market value. Lender may require that insurance.

 

If you leased a truck and were going broke doing it,
Would you admit it to anybody.
So everyone can tell you I told you so.
No, you lie and say everything is great then make up
Some family emergency excuse as to the reason
You had to give it up.

Same reason why people who get scammed out of
Thier life savings never say anything about it.
Thier too embarrassed.

So asking a leased driver how it's going is useless,
Unless he's willing to show you the past 6 months of
His settlements. Not his one good week in the past 3
Months.

 

Im sorry but theirs no such thing as a good lease purchase program that where the company leases you one of their trucks. Payments are often extremely outrageous and in some cases you will pay for that truck 1-2 times over before you complete the lease. A LP where the company owns the truck benefits only the company. If you take time off you will come back in the hole to the company or loose the truck and any equity you have in it, not good. The only lease purchase that I know about (have 4 drivers leased to same company I am under their LP program) thats any good is Lone Mountain Truck Leasing Inventory | Lone Mountain Truck Leasing

Minimal downpayment, monthly payment not weekly, you can put the truck on at any company you want to. I personally know 4 drivers at my company that have their trucks and they all seem pretty happy with the trucks they have. I put their link to their inventory page above.