Those that need/want to Fleece Purchase from a carrier

Lease Purchase?

Yeah, I could take a risk....who doesn't?

"We all gotta die sometime"

Well.....we all gotta take a risk sometime...

The problem on this board is not just the lack of healthy discussion, it's the lack of education and increased societal dysfunction within the realm of the "experienced" trucker (owner op) who compensates for it by talking down to those who desire success. As their years of "experience" progress, many on this board find themselves lacking any sense of humility only to have it replaced by an unhealthy obsession with failure coupled with a schizophrenic outlook on the industry they once loved. They have failed, once, maybe twice....miserably....only to see themselves morphing into character actors in a production that will shut down in a couple of days....but they will never admit it, they need to keep the illusion alive...

My advice for anyone going into business, any business, is to take a chance, don't be scared or afraid to drive a nail in the wood, learn, study, ask and believe in yourself.....scary old truckers on forums don't scare me anymore than the boogeyman....and I don't care about them anymore than those idiot 4-wheelers behind my tractor-trailer honking their horn to get me to speed up or move right.

The United States is the greatest country in the history of civilization.
It became great because of one thing......RISK!

REMEMBER:
Risk is your best friend
Risk is what built this country
Risk is what makes the world go round and
Risk will make you money or break you
Best of all RISK IS FUN!

....and everybody likes to have fun, right?

So let me leave you with one final observation;

If this forum were about women instead of the lease/purchase option, you would have nothing but a bunch of old truckers saying....No No No, women will destroy you (probably true in MANY cases), but there's always that one woman that you will take a chance with. She may pay off....or.....you WILL pay, nevertheless....it's all about RISK...

...and without Risk, there is no Reward.....think about it.

 

The problem with leasing a truck from a company is you often pay very high payments. When you could go to a dealer and often times pay lower payments.
I have seen drivers go to select trucks and pay $50k for a truck that could be bought elsewhere for $28k. But at select trucks it was little or no down payment. So instead of saving a few thousand $ for a down payment, the driver pays $22k more than he had to (plus interest on that extra money).
If you want to aquire a truck, try to avoid doing it the most expensive way possible.
That's the point I would like to make.
If you can't save a few thousand $ for a down payment plus more for an emergency fund, what are you doing buying a truck?
I really should start a truck leasing company or a rent to own appliance store. Then I could make a killing of people who make bad financial decisions.
Why pay $3000/month when you could pay $2000/month or you could buy a used truck..
Over the years I have seen plenty of drivers who paid way too much for a truck. But if that's what you wanna do, don't let me talk you outta spending $30k-$40k more than you had to.

 

A person can take all the risk they want, but in this business, if you don't know what you're doing, you WILL fail 99% of the time. If in an LP, there always have to be a few sucess stories to parade in the ads. You can't keep the same faces in the truckstop rags every month.

Risk is all well and good. I have risked everything, and lost most of it before. I have also risked everything, and it has been some of the best decisions I ever made. The difference was, I knew before hand when these opportinuties came along I could hardly lose unless I lost it myself.

In one opportunity I borrowed every dime I could on my home equity loan, and maxed every credit card out, (back when you could do this at a reasonable cost), negotiated a lower down payment with bigger yearly payments. I immediately applied for an SBA loan as soon as I purchased the business in order to pay off my cards and equity line, and to lower my payments to a managable, which it took several months to go through, but I got the loan.

This business was a bigger one like the business I had at the time. I had started mine from scratch, and micro-managed the figures, and knew what it was, and what it could do, so when the other came up for sale, I didn't even have to think about it. It was a very good decision.

In trucking you have to know, or be able to acquire, a lot of knowledge and common sense. Your business plans and money have so many different factors controlling it. When I bought my first truck I was very young, 19 in fact. I lit out without a seasoned driver with me OTR, with only a phone number of a person to load me. I took the rate offered, and if anything was left after I delivered, to me I had made money. Dumb, but I had no one to tell me different and help me. It wasn't long before I learned many brokers lied, I also learned some didn't and paid decent.

I also learned how to work on my own truck, which needed work all the time as old as it was. I also learned what it was like to borrow money from my FIL to buy groceries when the engine was down in the truck. I bought a truck based upon the looks, and the fact it had a recent O/H, which should have been a bad sign to me. It turned out the engine was a problem child, as was the truck, because most everything was worn out. Lesson...don't buy something you know nothing about with out taking someone that really knows how to check out a truck with you, and be willing to listen to that person and not let your emotions over rule that persons knowledge.

Know your cost to operate down to the hundrenth of a cent. It will take a few months to find your cost, and some expenses will have to be estimated based upon repair expenses to date, knowledge of what will break down, and your tire wear and repair to date. It's much easier to guess those things now with so much information on the internet.

Know how to drive the truck smooth and easy, keep it maintained, know what to listen for and feel when something is wrong. Don't drive hundreds of miles out of the way to see someone or something when money is tight. Know exactly how far it is from pickup to delivery, not what you are paid on. If you're paid mileage, the difference could go from say $1.00 per mile to .80 real quick. The shorter the run, the more you will be shafted on the mileage rates. If you get paid a very low rate to D/H, count that into calculations, especially if you are going into an area where you may have to move to get another load. A long D/H could drop you into the low .70's on that $1.00 per mile load.

You may do everything right, and still lose everything. You may have a problem child truck. One of those can break anyone unless you are able and willing to take a loss to get rid of it. After a few repairs for the same thing with different mechanics in a short time, you better move on to another truck, for you may not ever get it right, and if you do, you may be broke by then.

With trucking you have thousands of ways to lose everything, and a few ways to make it. That's a fact. Everyone, and I mean everyone, has their hand in your pocket, and you only have a few pockets to put your hand into.

There are risk in everything. There are good risk, dumb risk, and stupid risk, and risk only an idiot would take. Just saying to take a risk is a sure way to fail. You have to take an informed risk, weighing the odds with knowledge and education about what you are getting into. You WILL need lots of help and guidance from someone long term sucessful. Most anyone can look good financially on paper under the right circumstances for a year or less. I mean find someone with years of making money and experience.

After you decide to take the risk, be perpared to lose it all, everything, even to the point of having nothing and still owing lots of money. That is what risk is all about. You win, stay the same, or lose big. That's why it's called risk.

Also, many long term drivers know squat about trucking, or how to drive for that fact. I have teamed with 8-10 year or more drivers that I was thrilled to have my run over with and be out of the truck. Years of experience is not always years of good knowledge. Sometimes it's just years of holding a steering wheel from one town to another, daydreaming all along the way. And also, years of being a good company driver does not mean a person knows anything about owning a truck, no matter how good of a company driver they are. The only way to truly know what the boss goes through is to be the boss, or owner and driver of the truck in this case.

What I'm saying is don't jump into the deep end just because nothing is accomplished without risk. If you're going to jump into the deep end, at least know something about how to swim, and know the conditions of the water.

I'm going to assume (there's that word) that the poster I quoted was speaking of managed risk, and not blind risk. I just wanted to expand on it.

If you think you have what it takes, realistically look at yourself, and want to give owning a try, a decent WALK AWAY lease may not be a bad thing, after you have learned how not to tear up a truck on a company truck. This way if you get in too deep you can walk away and be done. If you buy outright or do an L/P, you are still on the hook long after you jump ship.

If it appears after a year or so you have be an informed, successful leaser, you should be ready to buy your own, if you want that responsibility.

Not everyone needs or wants the same thing. At least with a good lease (if you can find one) you have the company to back you up when that big expense hits you and you don't have any money to pay for it. Some companies will just yank you out of the truck, others, if you have proved yourself, will front you money to keep you going. Just remember, they will get their money out of your check first, so be prepared to live lean for a while.

As long as this is, I have only touched on this subject. There is so much to know it would take a large book, with more added every day.

 

I can see how idiotic it may seem to wait in line for a small repair that does not require tools. But also I would not sacrifice my hometime and get dirty my clothes and my precious Mercedes if I am at the home shop. There is a difference between a driver and a mechanic. If I gross 265000 a year I can spend 15 for repairs and preventive maintenence.
It is definitely better to have those mech skills than not. But to say that you cant make it at all or should not be O/O if you are not mechanically inclined is a little overboard

 

These leases typically only attract those with credit that is in despair. So for someone with bad credit, no money for a down payment, and a history or poor decisions with money, it only makes sense that it would be an attractive way for them to become an owner operator. Now before some of you get bent out of shape over my statement, read the first sentence again, very carefully, notice the use of the word "typically."

And here is the problem with that. Our creator in his good book says that we are not to oppress the poor. Basically that we are not to charge someone more for something just because they don't have the means to acquire it another way.

 

I am sucessful, very sucessful L/p o/o. Company I was leased to, and still am with, with a paid-off truck, never once mentioned me, or my truck to anyone for advertizing, or ever approched me about it. Their sucess rate is fairly high so far as well. They only started a L/p deal a few years ago, when the economy was bad. They ended up with an excess of used (400-500k) trucks that they couldn't get rid of. The C.E.O. stood right in front of me, and all the office personel, and stated "I don't like Lease purchases. Most drivers end up failing...If a good driver wants to own their own truck, thats fine, we have an excess of them that we need to replace...but,...I ABSOLUTELY DO NOT WANT THAT TRUCK BACK!,...I/we are not a charity organization, but we can at least do what we can, to help them not fail as much as possible."

 

The one sentence you chose to quote is for the vast majority of lease purchase companies very true. Read the terms. Unless everything falls exactly into place, they are almost impossible to accomplish. If you had read the rest I also stated a GOOD walk away lease may be the best way to start out with a first truck.

Someone has to be the face, or in these days of internet forums, voice of the fleece. Some will make it, and it has a lot to do with what someone's definition of sucess and great money is. What is great for one person is horrible for another. If I am only going to make the same as, or slightly more than a company driver, then no, not if I am under forced dispatch, or am forced to run because my payments will get me in the hole if I take a week off.

If I have true freedom to go and come as I please, and can take off as much time as I want, then I may be willing to work for company wages with my own truck.

I'm glad you have a good company to lease from that has treated you well, set you up to make money and own the truck. The vast majority do not do this. They use leases as another stream of revenue and as a way to have someone pay all the expenses of running the truck. They also know the lease driver will run much harder than a company driver with less home time because they have to.

 

Yes, you are absolutely right,...There ARE a few good companies to L/p from that are not bad,...but,...

What I am about to say here is NOT fiction or just opinion. I have looked and researched very heavily into the whole L/p thing...

There are many companies that are sharks, using L/p as an extension of their revenue. Most are very easy to spot. The dry-van/reefer market lends little room for profit to begin with, and Companies that put rookie drivers into New, or Almost New equipment as L/p oo's running this kind of freight with 700+/week payments already know the profit margin is too thin for it. On top of that, they will ask $139,000 for a truck they bought at a fleet discount for $88,000 or less, and sometimes adding interest on top of that. It sickens me when I see these companies L/p O/o trucks roll down the road, their drivers screeming past me, struggling, behind on payments, not knowing any better, continuing to keep these crooks in buisness. Instead, these drivers should have their focus on lowering their fuel and other costs, beating them at their own game, or perhaps finding a better company to L/p from. Of coarse there is that company that forces their L/p O/o's drivers to run 60-62, that everyone know all too well, that convince their drivers they are a good lease company, when in fact, they still sell their equipment at ABOVE list price and interest to boot, just like the other really bad companies, all the meanwhile trying to force you to start your lease over every time you get close to completing it, keeping you 'In their endless Net of Greed'. This makes their lease only affordable if you do in fact squeeze every last drop of fuel out of your very overpriced truck, making those 700+ a week truck payments. Yes there are a few sucessful drivers with this company, because they figure out how to discipline themselves for such things, but at the end of the day, If they want to continue service with them, they are forced into leasing perpetually under the pretence that 'Your truck is too old'. This in my book is as wrong as the rest of the sharks out there, because you will never have that clear title and wad of cash they claim you will easily get.

There is very good reason so many have a bad taste in their mouths over the whole L/p o/o thing. There are actually more companies that are bad, than good, when comparing them, but NOT ALL ARE BAD. and that Is the whole point to me chiming into this ill-begotten thread to begin with. People who do not know any better,...Ppl trying to research this subject,...ppl new to trucking, need to be able to learn what options are out there for them, including the few L/p programs out there ALONG with all the other avenues like buying outwright, financing, and everything else.

 

When stuff needs doing at home, besides fabrication work that I ALWAYS do myself, the rig is dropped off at the dealership as a rule. So that far, I agree with you.
Now, last Sunday for example, at the J in La Salle,Il.....
Guy 2 trucks over from me has his hood open. I haven't showered yet that day, and was checking my fluids and tire pressures with my trusty gauge.
I walk over, 'cause believe it or not, that is the type of guy I am.
Turns out, one of his pulley's locked up, taking part of the tensioner with it and resulting in a thrown belt.
I look at the bearing/pulley and tell the guy to hang tight. Turns out they were the same as my old MBE pulleys, of which I kept 2 spares after replacing the bearings myself ($25 vs $80 BTW).
We pulled the tensioner, did some filing and drilling, bolted the "new" pulley to his tensioner with a nut and bolt I had in the bottom of my big toolbox, and he sat in cold AC the rest of the day. He was delivering in Davenport the next morning, so could buy a new tensioner at that time and keep the rigged up one as a spare. I bet he carries spare pulleys from now on....
Moral of the story? Folks like me wont always be there for you, so knowing how to rig something up yourself could save you anything from a road call (TA was nearest place, 50+ miles away), a tow bill to a repair shop, or a blown motor if left lone.
I asked for the $25 the bearing cost, he insisted on me taking $40. A real bargain for the owner of the truck, and a free meal for me when I wasn't doing anything anyways.
So I strongly stand by my prior statement of knowing how to repair stuff. That Flease truck may be under warranty, but the tow bill to the dealership, and the downtime are not 99% of the time.

Martin

 

In this industry, as a truck owner, it is cut very clear,...The more you know about your truck, and keeping it running, long term, the fatter your wallet will need to be. Every single long term (10+ years) sucessful truck owner I have ever met, can tell you how to do most things toward keeping your truck out of a shop, or off the end of that preverbial tow-hook. This is very telling of what it actually takes to be sucessful. Also, once you take the time to learn to do something on your own, the proper way, repair or otherwise, it will always be there to benifit you, increasing your bottom line. Knowledge is the one thing that no one can take away from you,...ever,...Use this to your advantage as much as possible, and share it with others when they need it. Everyone benifits from this.