swift and the lease purchase

If you look at it that way, it doesn't seem to make sense. But it's not a lease purchase. It's a straight lease, or rental agreement, and you have the option to purchase at the end of the lease term.

It's like renting an apartment for $650/month (cheap) for ten years and then the property owner decides to convert the complex to a condominium. You have the option to buy, but none of the $78,000 you've paid in rent is applied toward the purchase price. However, the landlord is going to give you a discounted price since you're such a great tenant.

In the case of this ProStar Eagle, I will have the option to purchase it at the end of the lease term for about 60% of the list price for an identical truck on the open market. It's entirely up to me what kind of condition it will be in when the lease is up. If I beat it up, it will be junk. If I take care of it, I will have a good truck with half of its life still ahead of it.

Think about this: lots of people advocate purchasing a used truck. A typical used truck on the open market is three or four years old, with between 400K and 500K miles on it. That's exactly what this one will be when I am finished renting it. In the mean time, as I rent it, I am making money off it. Not too shabby of money, either.

Right now, Taiowa is not in a position to purchase a new truck on the open market. Taiowa needs a bigger asset base before I will be comfortable risking its credit. The time in the rental agreement was first, to get everything caught up and bring my personal stuff out of the red. When that was finished, it was Taiowa's turn to build assets. With an asset base, Taiowa will be in a much better position to add a large liability like a truck purchase payment.

It would be stupid to turn away from a truck I know, that has been maintained to my standards and not abused in favor of a truck I will pay 40% more to buy that I have no idea of its history.


Are you going to buy the condominium you already live in and know your neighbors? Or are you going to move down the street to a worse neighborhood and pay a higher price just because you think the landlord owes you a bigger discount?

 

Ok So you"re "renting" your truck to make money. I understand renting the tool you need for the job. The Swift program is great in that you can get in for next to nothing. I guess it comes down this--- at the end of the day I would prefer to have my name on the title rather than someone elses. I like to own my own tools,particularly ones I use every day. Will that work for me? It can IF I have my act together enough. What yer doing seems to be workin for you, right on sister! I'd rather own my house (me and the bank) than live in an apartment. But we both got to live somewhere.
For now it's all hypothetical any way.. I'm still waitin for a mentor!!! Seems nonsmoking flatbed mentors are a novelty!!

 

Important things to remember in deciding which way you go.

Many/most times the company doing a lease or L/P plan are some of the lower paying companies. This, along with a fairly high lease payment, assures them that you will want to stay out as long as possible, run as many miles as possible, and go home as little as possible. On the other hand, they handle the paperwork for you, including tags, permits, fuel tax reporting, ect. Usually you pay for these things, but they handle the paperwork.

When, not if, you truck has a breakdown, usually you have a warranty, and if needed, many times if the repair is not a warrantied repair, and you can not pay it, the company will front you the money. Some companies will arrange a loaner truck while your truck is in the shop.

When looking at the cost of the truck through out the lease, the price is not much different that buying, if you account for the amount of interest you will pay when purchasing. This is not true in all cases, but I have figured many cost from posters, and the figure is fairly close.

But, you are locked into what the company gives you like it or not. This includes loads, truck, ext. If things go bad, you loose what you paid, and considering what type of lease you have, you could end up owing quite a bit after loosing the truck. Bur, the same goes true if you loose a truck you purchased.

If you buy a older used truck, you may or may not spend all your money for the truck purchase, and then uou have money spent on repairs. If a big repair comes right after you buy, you are through, unless you have a lot of money saved up. There goes your truck, down payment, all the money you spent on payments, and your credit.

With your own truck you can pick who you lease to, but for some reason many go to the same people that pay the low rates. But, if things go bad, you can leave. Unfortunately, the cost associated with changing companies is quite a lot when you consider lost revenus during the change.

A plus for leasing, is if you have a pretty much walk away lease, and you get tired of trucking, get sick, find you need/want to be hame more, then you can leave. If you own, you can't just quit unless your truck is paid for. It's not that easy to sell your used truck for what is owed on it.

The above is just two sides of the coin as I see it. You have to choose which suites you best. If deciding to lease, do research, and see who does the most for you, and how hard it is to get out of the lease with the smallest amount of damage to you.

 

Injun, that is absolutely the best explanation of a lease I have ever read. I am going to use it to better explain to my wife how it works.

My friends (a husband and wife team) were very reluctant to do the Swift lease and now that they have they wish they had done it long before. After their settlement they are banking 3 to 4K a week.

While it's not for me and I don't see myself doing one, at least I better understand it now that you have explained it this way. Nice!

 

These are perhaps the wisest words written on the subject. We all should have the smarts to understand them! Well written, sir, well written.

 

If they are banking 3-4K a week,

they sure are doing well !!

 

I ran 2,450 miles last week and put $1,228 in my pocket for it. Well, Taiowa's pocket. But you get the drift.

I run completely solo.

 

Compelling argument to a guy whose makin zip at the moment. I will say thanks for the explanation too. I have a much better idea of the possibilities.

 

I did get a mentor today though.... No Argosy's fer me. haha

 

There are two active Argosies at the Troutdale yard. I might talk to one of the drivers to see how attached to that COE he is.

Your Argosy can still be arranged.