Lease purchase experiences? Is it Worth it?

No, No and No.

 

I agree, no, no, and heck no. And another no for good measure.

 

The whole thing is designed to get the lease operator hungry enough that he runs full out max out just to have enough to eat after paying the 'rent' on the equipment.

The L/O's who run like this will get attaboys, smiley stickers, belt buckles maybe cash bonuses all paid for with your own money the company stole from you to begin with.

The company might be booking $2 and $3 dollar freight and paying you just $1 dollar but that is not good enough for them; they also have to short your miles out plus the fuel discounts they keep which will push your true pay down below $0.9

 

Looks to me the odds would be in your favor. Where there has been a million before you that failed it would appear a success story is past due!

 

Instead of doing a lease/purchase, do a "purchase only" through Fikes Truck Line or Cardinal Logistics. When I went through Cardinal's orientation we were told, "the note is in your name, you can leave anytime and take the truck with you." I think Fikes is the same, but a phone call and you will know for sure. I didn't follow through because I didn't want to be an 0/0 and still don't. Drove a company truck for them instead; for a few months. With Cardinal the down payment was $2000.00 which is pretty good. Don't know what Fikes requires.

 

Just do your homework. If you have to ask in the way you're asking, obviously there are a lot of costs in trucking you're not considering. Bottom line is, leasing plans [too often] are simply a means to shift the burden and costs of slow freight seasons and poor freight availability to the drivers (contractors). You are merely "renting a job" in many cases, earning little if any equity in the truck unless you manage to stick it out for the duration (the wheels start falling off). And few do/can.

"Renting" a truck long-term (like many lease contracts are essentially) so you can have a income makes very little sense, no matter how you choose to look at it. There are too many good company driver slots out there. The roads today are literally filled with old, wore-out trucks, gel together with wire and tape, the result of many cycles of "failed businesses". Trucks that have been bought and sold and paid for 2-3 times, over by the never-ending cycle of desperate drivers wanting to "be their own boss". These trucks made the carrier money when times were good, and they saved the carrier money when times were slow or things broke ... ALL at some contractor's expense and demise.

This is all not to say, some have been successful, but it takes lot of hard work, absolute devotion, perfect long-term health, no serious accidents/incidents, and A LOT of luck, especially in the first 1-2 years. And you need to realize and understand there is a huge difference between an independent owner-operator, and run-of-the-mill lease contractor. These are 2 completely different business models.

 

i think SNI let you leave with the truck 2.. im not sure tho.

 

Bottom line is, if you inherit a bunch of money, and can go out and pay outright for good used truck cash, or pay 80% down on a new truck. You're on you're way to standing a chance making it through the first year. But the way lease agreements are written, they allow the carrier to move "cheap freight" if they need to (or all the time for that matter) Having a fixed cost at 90 cents/mile + FSC gives the carrier A LOT of flexibility in setting rates and accepting offers, and practically guarantees the contractor remain in a permanent state of "non-profit" business activity. Paying yourself a wage or salary and having little if anything left over after expenses are paid IS NOT PROFIT. But be sure, the carrier is making a lot of profit on you, while leaving you on the hook for massive costs and one illness away from of bankruptcy and a ruined credit report and work history.

Never mind the fact carriers use leasing programs to shift employee tax liabilities (FICA) away from them, and onto the "contractor". All you need to know is, a carrier can move freight with a lease contractor cheaper then they can a company truck/driver. You do the math and draw the necessary conclusions.

 

If you come into some cash like someone else has said, you'd be better off putting that into the bank, and leave it there, and here's why.

First, it'll get interest. Second, you would HAVE money in the bank for your first full year, if you DO NOT touch it. Any new business will need back up funds for x-number of months, to pay down your debts, and YOU WILL have lot's of debt, because your first year or two, are the "proving years" for you. You would be an "unknown quality" lease owner, and times will be tough and down right slow for you at times. Where's that "emergency bill fund" if you take that sudden money and blow it off just to buy the truck?

To take any sudden money, like a lottery winnings or inheritance will quickly disappear in due time.

It is actually a losing proposition to take all the money you suddenly garner and badly invest that into a device such as a big rig as they depreciate once driven off the lot, and that's a fact.

Lease to own deals benefits the company, hardly if ever the person signing on the dotted line. some will say they are making money, but I have never heard the "bottom line" they actually take home after ALL bills are paid. They say something like, "i grossed over $200,000 last year". But ask them how much money they actually took home. If they say, "around $40,000" after GROSSING over $200,000, there is a huge problem, and when you "figure" the annual salary of a trucker at or about the $40,000 level, why bother with the bills, headaches of lease to own?

I have been a company driver all my career, and yes, for sure, I "thought about" going the lease owner way. But I did my homework, and my calculator never made sense of the numbers. In fact, I had to buy at least 4 replacement calculators as each one would burn out in disgust.