LRM LEASING HAS ANYONE DEALT WITH THEM?

Did you ask? Did your sales guy's name start with a T?

 

I got 2 buddies who got cascadias working for CFi and the other land star so far happy they talkng to them later today
who you talking to im talking to chris

 

Talking to Tyler for myself in Greensboro but Rick in FL was original sales guy for my friend. Tyler did tell me that he was getting new inventory in, in about 2 to 3 weeks. I priced out what it would take to get to Davie FL and doesn't seem worth it. I want to make sure we have a budget put aside for inspections and getting whichever truck road worthy and would need at least a week down there. Neither of us really can wait but Im on the side where Ive seen how easy it is to fail and lose everything so if I have to, I will.

I think it just might be that I happened to come at a bad time for inventory and maybe the Greensboro location doesn't get stocked like in FL. When you deal with subprime lenders, you are going to take a hit somehow so Im not TOO concerned with the total price of the truck as long as monthly payments are manageable but it has to be a solid truck. I already have shippers and know what revenue is going to be. Just need to pass this first #### year.

Either way, Im finding other trucks now and getting ready to head out and look at them. Will see how it works out!

 

Why if you got all paperwork and budgeting knowledge are you trying to purchase a truck in the most expensive way,just curious

 

Most expensive way, how? Here's what I've found:

1. Start up fleets are generally only fundable by subprime lenders no matter how many years of driving experience.
2. Whether you lease or finance, subprime lenders cost at least 14-18% in interest and all require a minimum 20%-30% no matter your own personal credit score. (CAG starts at 14%)
3. To get out of the subprime lending (ex: wells fargo's transportation lending and equipment lines of credit program), you'd need to have an active authority/MC for 2 years and have shown strong revenues. Even Penske's leasing program requires 2 years.

Note: the requirement is not that you are an owner-operator for 2 years leasing on to someone else, but fleet. Also our strategy is leasing and swapping them out every year or two.

LRM's program:

1. Costs the same down as everyone else.
2. Monthly rates are the same as everyone else.
3. You can send the truck back anytime with no penalty.

What LRM had going for it is being able to dump the truck after a year once revenues have been shown and can qualify for non-subprime lenders (there's already a year down from the brokerage side). Truck payment is $1500 and insurance $800. Pulling in $5k to $7k gross per truck (the range I currently average) with no more than $1,000 towards fuel that week, that monthly payment is manageable (even if not desirable). Unfortunately I just can't do LRM's high mileage inventory and am afraid of maintenance costs. Maintenance costs, of course, would make or break the budget.

We could just buy the trucks outright at a lower price point but then you tie up capital that could be used to earn more revenue (or used as reserves). I'd also be entering high mileage terriroty. Drivers are hard enough to recruit and manage, try keeping them in a 2009 Volvo with 800,000 mile issues (been there, done that).

Waiting on decision from another program, however, that's closer to Penske's set up and would allow us to add more and swap out trucks as needed. No downpayment required and they accept start up fleets. The monthly payments would range between $1200 - $2000 for 2013s and younger with mileage between 100,000 to 300,000.

Open to other programs anyone else has found though.......

 

1well you put interest rates for sub prime loans what is LRM interest rate? 2 lease purchasing for a year then turning it back in is the most expensive way or are you like MysticHZ and think leasing equipment and lease purchasing are the same program?As far as tying up capitol is really a sorry excuse for not having enough capital to start a business.

 

1. How could you think Im not aware of the difference if I specifically stated the strategy is swapping out trucks every year or two? Do you know the difference?

2. I put interest rates for subprime loans because we are talking about subprime loans and what a start up fleet would realistically qualify for. I tried my best to separate the points but let me know how I can make it more clear.....

3. Debt leveraging is a business concept that mostly all businesses (and especially the major fleets) use. A .simple explanation: "even if we have the capital, could we make more borrowing against it vs tying it up?". Leverage // The companies you lease on to certainly use debt leveraging at your expense and to their advantage......

 

Don't explain leverage to pepper ... he thinks it has something to do with negotiating.

 

LOL

 

How is the best way to gain leverage.Put the % 20 to % 30 down which will get you a better interest rate compared to nothing down,And will you have more leverage with the lower operating cost compared to a LP with high payments and have the restrictions from the Leasing companies what or where you can take it to. And your trying to do the same thing MysticHZ tried by being misleading how major companies use leasing your not leasing your lease purchasing.Here is the difference major companies lease equipment there contracts are usually 3 years and payments are set by the depreciation of the equipment in that 3 years the key word is depreciation.A LP your payments are based on what the seller values the equipment.Big difference in monthly payments.So really stop trying to compare yourself to a major corporation.Your either trying to mislead people or really don't understand what your talking about