Hey fellow truckers! God speed to all
I have got the lease proposal today for a used semi-truck purchase. This is my first venture in this matter, so I am cautioned to step in. I humbly ask all the good truckers and specifically the ones which had this experience to simple comment this lease proposal. Also, given that this is merely the lease proposal and beginning of the process, any suggestions on questions which I should/must ask the lender before the lease agreement are more than welcome. Thanks much.
Lease Proposal
Discussion in 'Ask An Owner Operator' started by Blacktooth 018, Mar 26, 2021.
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So much to cover with a lease purchase. How many miles on the truck? Under warranty? Service plan? Do you have your own authority, or are you using the lessors? How much do you have in your rainy day fund? Renting/buying a trailer?
Coffey and Blacktooth 018 Thank this. -
Why?
don’t lease purchase without legal advice. Get a lawyer to explain the contract and to help you prevent failure.Coffey, GFTLLC and Blacktooth 018 Thank this. -
What they said. After you go on your own you won't be able to get a buyout loan for two years because of self employment. Take it from someone that did a lease purchase without a contract and saw terms change once you're neck deep. Dumbest move I've made to date. Luckily was able to get a loan to do a buyout and not lose everything. And it was close. I did it the worst way possible I believe, so if you have questions look me up. I can definately tell you what not to do.Coffey, Blacktooth 018, slow.rider and 1 other person Thank this. -
Hmmmm. That's a lot down. I lease trucks, but I let them get started with $0. $100 buyout at the end. And their payments are less.
Speed_Drums, Coffey and Blacktooth 018 Thank this. -
By the same token, I fully understand why they charge so much up front. It is a business. For adults. Adults being the key word in this post.
Vampire, Coffey and Blacktooth 018 Thank this. -
slow.rider Thanks this.
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I have been in this business for 47 years and 99 percent of every lease proposal that I’ve ever seen were written without the leasees best interest in mind. We refer to them as the never never plan. Have someone that you really trust that knows trucks and business read this proposal before you agree to sign. The biggest most important question is ... after you have made payments on this truck for a year or two do you have the ability to take it to another company where you would have the ability to earn more revenue?
Last edited by a moderator: Mar 28, 2021
Reason for edit: Removed advertisingslow.rider, Blacktooth 018, TallJoe and 1 other person Thank this. -
Just as a general business note: leases are commercial contracts that are pretty ironclad legally. You are bound to it regardless of changes in circumstance or income. You want ironclad ability to pay regardless of breakdowns, route changes, getting sick, etc. A good size buffer fund should be at hand. When I did logging a partner and I considered leasing some equipment to upgrade. My CPA friend disabused us of our dreams just because we had a one year wood contract but looking at a three year lease. As it happened the bottom fell out of the industry after our contract expired and we were #### glad we did not get into a big lease. Equipment repairs ate through our contingency fund just two months before that. Not to say leases are bad, just that they deserve very serious thought and be willing to acknowledge whether you can commit to a ironclad contract or if you are running too lean and have not enough contingency yet.
Blacktooth 018 Thanks this. -
Has the ever popular Lone Mountain had not a better deal than that?
You take the truck and do whatever you want with it. Almost the same as a purchase. As far as I remember, for a new truck, it was $15 000 down, then $2700 (or close to it) times 60, each month after which they sign off on a title to a lessee. Question remains, why would that be better from going to a dealership and put the money down? Are they more lenient with a credit check than a bank or credit union on a commercial loan?
Better question yet, what if they go nuts and close the shop and/or other bank buys them out? LOL - I actually called them and asked them that question and the rep had no answer. NONE. As if nobody else every asked them that. Too hypothetical, I guess.
Therefore, I still prefer to purchase and have my name on the title from the very get go.Vampire and Blacktooth 018 Thank this.
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