Lease Purchase with CRST Malone

[tgruhlke]

Hi guys,

My Husband is new to the trucking industry. He has about 9 months of experience. He's had a hard time finding a company that he's happy with. He started off as s flatbed driver with Falcon, out of Gary Indiana. He ran his butt off. His pay was 22% of the cost of the load. The problem was that they had him deadhead at times. His paychecks were awful, $600-700. Now he's with JB Hunt in their intermodal division. When he first started, he got all the miles he wanted. He was consistently getting 2500-3200 miles per week. Now he's fighting to get the miles. I guess he's talked to other drivers with JB and this happens.

Now he's talking with CRST Malone about a lease purchase. It's a 3 year lease. From what I read, most of you guys don't recommend it. I've talked to the recruiter, she said that he'll get paid 75% of the load. We live in Northwest Indiana, so there's plenty of steel out here to haul. She said that their drivers deadhead less than 10% of the miles that they drive. Since we live in Indiana, she said that getting the loads won't be a problem. The truck payment is about 300 per week. When you add in the insurance, gas advance, permits, trailer rental, securement equipment payment, the total weekly payment is amount $1600.

My husband is so excited about doing this. He really wants to get out there and work, so he thinks that CRST will give him the freedom to choose his own outcome. The recruiter keeps saying that he'll average about $1.68 per mile and that what he makes depends on how hard he wants to run. I just want to make sure that we won't have to fight for loads.

I guess my question is do any of you have any experience with this company? Are the loads there?

My husband and I know that this will be a lot of work. We know that we'll have to save for emergencies and such. I'd like to know if you guys are really happier doing this versus being a company driver? My husband thinks that there's good money to be made by doing this as long as you're willing to work.

Thanks in advance for your feedback.

[Rev.Vassago]

I've talked to the recruiter, she said that he'll get paid 75% of the load. We live in Northwest Indiana, so there's plenty of steel out here to haul.

From what I've heard, steel is generally a cheap load. 75% of 0 is still 0.

She said that their drivers deadhead less than 10% of the miles that they drive. Since we live in Indiana, she said that getting the loads won't be a problem. The truck payment is about 300 per week. When you add in the insurance, gas advance, permits, trailer rental, securement equipment payment, the total weekly payment is amount $1600.

Your fuel costs are obviously off, because you could easily spend $1600 per week in fuel alone.

You didn't add in a lot of things to this, such as maintainance, repairs, tires, taxes, etc. Your $1600 per week could very easily become a lot more than that.

My husband and I know that this will be a lot of work. We know that we'll have to save for emergencies and such. I'd like to know if you guys are really happier doing this versus being a company driver? My husband thinks that there's good money to be made by doing this as long as you're willing to work.

Why not go through traditional financing, and put a down payment on a truck through a dealer? If you cannot afford a down payment on a truck, I can guarantee you cannot afford to be in business for yourself.

A $300 per week lease purchase payment is obviously on a used truck - that means higher maintainance, repairs, etc.

Do you have $15,000 to throw into an engine overhaul?

[yoopr]

GMAN should be along shortly to help you with CRST

[tgruhlke]

The $1600 a week total came from CRST. That total does include maintenance through a CRST approved facility. I know were not going to get rich off of this, especially starting out. Regardless if we get a truck through CRST or a dealer, we'll have to worry about expenses that we didn't have to worry about as a company driver. My point is, in the long run, are the headaches of being an o/o worth it?

[Rev.Vassago]

My point is, in the long run, are the headaches of being an o/o worth it?

Not on a lease purchase program.


Go to a Rent A Center, and see how their program works. A lease purchase is the same.

[yoopr]

My point is, in the long run, are the headaches of being an o/o worth it?

It's all relative-I can't comment on CRST Malone because I was never a O/O with them.
Remember with L/P you are under their Thumb-GMAN Leased with them I believe so he'll be able to tell you their ball park Rates.

[gcal]

My point is, in the long run, are the headaches of being an o/o worth it?

Not on a lease purchase program.


Go to a Rent A Center, and see how their program works. A lease purchase is the same.

that is sad if people can do that to someone who wants a rig and to start a business. but to do it to a retard who cant live with out a 60 inch tv is funny and he deserves it.

[Ian Williams]

that is sad if people can do that to someone who wants a rig and to start a business. but to do it to a retard who cant live with out a 60 inch tv is funny and he deserves it.

Some evil marketing geinus combined Rent-to-Own with Bling Bling and volia! RTO Wheels!

http://www.detnews.com/2005/autosins.../C03-69726.htm


At least you can enjoy the game or playing your Xbox on a big TV.

[Sonny Pruitt]

well, you kind of answered your own question

2 jobs that he did not like.
This is not a problem you can always leave and find a job that fits your needs.
What happens if he does not like CRST ?
He signed for 3 years.
That's 3 years of you hearing him complaining.

[flyncasafo]

I recently heard that defaults on truck leases are at an all time high. Why is that?

It sure is a great feeling and thought of being your own boss, but it takes %200 work and stress. Don't lease! Save your money and buy a truck and be able to pay it off from day 1!

I am sure your husband is a great guy, but if he can not stick with two companies in 9 months, he will not be happy making lease payments on a truck that will not be his in 3 years. Stick with working for a company until you can come up with the cash to purchase a truck. It does not make sense money wise. The companies would not be doing this if it did not make them money. Do not do it!

[GMAN]

He can qualify to lease or run for CRST Malone after 6 months of driving experience. I sent you a pm a few minutes ago about their program. I will expand on that somewhat for general consumption. The first thing he need to do is find a company and stay with them. We are in a slower freight cycle right now. This business has it's strong and weak cycles. We are now entering a slow down, although it is somewhat earlier than usual. I suggest he gain more experience as a company driver before jumping into a ownership situation. He will not be an owner operator if he leases a truck from a carrier. He will be a lease operator. There is a difference. You can buy a truck that you will own for about what your actual cash outlay will be with CRST or any other carrier. If you are running as you probably should, you will burn about 100-125 gallons of fuel per day. At $2.50/gallon you will spend at least $250 per day on fuel alone. I have spent more than $1,800 per week just on fuel per truck. The figure that you were quoted is in the range you can make with them. Keep in mind that also includes the fuel surcharge which varies from week to week. If you have huge fuel spikes it may take a week or two for the fsc to catch up to what you are paying at the pump. That means that you will need to pay out the difference. If I remember correctly, the average miles an owner operator runs with CRST Malone is around 2,500/wk. You will also need a trailer if you lease on with CRST Malone. You can purchase your own trailer, rent one from a leasing company or rent one from them. They charge $165/wk for trailer rental. You can buy a good used trailer for about this amount monthly. This is another expense you will have when you make the switch. Most flat bed carriers do not furnish a trailer to owner operators, although there are exceptions.

I have a friend who is leased to them and averages around $2/mile to the truck, but he is an owner operator with a number of years experience. You are assigned a dispatcher, but will need to be very proactive to find the better paying loads. You do live in a good freight area for flats. Steel usually pays fairly well coming out of that area. However, there are also cheap loads. I have seen rates range from $1.45 to over $3/mile plus fsc for steel. That is gross and not truck money. Your part will be 75% of those numbers plus fsc. Newer drivers are usually not offered the higher paying loads. Most carrier's like to see how a owner operator or driver runs before offering the better paying loads. Those with experience will not normally haul below a certain amount, so they tend to be offered the better paying loads.

My suggestion is for your husband to get more experience, save his money and buy a truck. If you get into one of these lease programs, you will usually make less than if you stayed a company driver. If something breaks, as it always does, you will be responsible for all repairs. Unless you have a good nest egg starting out, you could be sunk and in bankruptcy. These companies would not do these fleece purchase programs if they were not profitable for them. You can buy a good used truck for under $20,000. Most lenders will require from 10-30% down payment with decent credit. One thing lenders look at is your credit score and experience when looking to lend money for a truck. There is a high failure rate in this industry. The more experience and better credit score makes him a better risk. He hasn't been in this industry long enough to know very much about how things operate. Business is picking up a bit and will do so until around mid December. Things will be slow until after the first of the year. Most aspects of the business will pick up around mid to late February. That is just the way the industry works. He may not be getting the miles he wants because of the general slow down and may have nothing to do with the company where he works. Drivers lose a lot of money each time they switch jobs. Also, some companies are looking more closely at how many jobs a driver has had. I usually won't hire a driver who has had more than 3 jobs in the last 2 years. There are companies who will hire someone who job hops, but those are usually not the better paying positions. The better carriers want job stability.

[Rev.Vassago]

These companies would not do these fleece purchase programs if they were not profitable for them.

And it says a lot about the company as a whole, when they will willingly screw over the hand that feeds them. CRST included.

[azcardnlz]

My suggestion is for your husband to get more experience, save his money and buy a truck. If you get into one of these lease programs, you will usually make less than if you stayed a company driver. If something breaks, as it always does, you will be responsible for all repairs. Unless you have a good nest egg starting out, you could be sunk and in bankruptcy.

Don't they have a maintenance program where you pay 11cpm and they cover all maintenance and repairs, including tires?

[GMAN]

They don't cover anything. The mandatory maintenance account is set up for you to take funds out as needed. Should your costs be more than you have in the account you will need to come up with the rest of the money. The maintenance account is really designed to pay for a major expense, such as an engine overhaul. CRST Malone is not the only carrier that has a mandatory maintenance account. They all have a mandatory maintenance account. It is not insurance. It is a maintenance account set up so you will have the funds available when you need any type of repairs. They will advance the money but you will pay for your base plates and permits in ADDITION to any other costs. They deduct the cost of plates at about $75/week. You pay that whether you lease a truck from them or sign on as an owner operator. Keep in mind if you lease a truck from a carrier, you are not an owner operator. You are a lease operator. There is a major difference. Your lease payments will go on whether you run the truck or not. You cannot afford to pay out $800/wk, buy fuel and have much left over. You cannot just access the maintenance money anytime you want. You must get in touch with the person who handles that for the company. They usually work during regular business hours. I am not sure what you would do if it was after hours and you didn't have the funds with you to pay for the work. If you don't have your own tarps, binders, chains, etc.,

We have discussed this a lot on the forum. A lot of those who ask only want validation about a decision that have already made. I don't think the fleece purchase deals are good for the driver. If it were me, I would save my money until I had enough to pay cash for a truck or at least enough for a

[azcardnlz]

They don't cover anything. The mandatory maintenance account is set up for you to take funds out as needed. Should your costs be more than you have in the account you will need to come up with the rest of the money. The maintenance account is really designed to pay for a major expense, such as an engine overhaul. CRST Malone is not the only carrier that has a mandatory maintenance account. They all have a mandatory maintenance account. It is not insurance. It is a maintenance account set up so you will have the funds available when you need any type of repairs. They will advance the money but you will pay for your base plates and permits in ADDITION to any other costs. They deduct the cost of plates at about $75/week. You pay that whether you lease a truck from them or sign on as an owner operator. Keep in mind if you lease a truck from a carrier, you are not an owner operator. You are a lease operator. There is a major difference. Your lease payments will go on whether you run the truck or not. You cannot afford to pay out $800/wk, buy fuel and have much left over. You cannot just access the maintenance money anytime you want. You must get in touch with the person who handles that for the company. They usually work during regular business hours. I am not sure what you would do if it was after hours and you didn't have the funds with you to pay for the work. If you don't have your own tarps, binders, chains, etc.,

We have discussed this a lot on the forum. A lot of those who ask only want validation about a decision that have already made. I don't think the fleece purchase deals are good for the driver. If it were me, I would save my money until I had enough to pay cash for a truck or at least enough for a

Their recruiters are lying then, (surprise!) They are saying that you get a full bumper to bumper warranty that covers everything for the first two years. They say that it's not a maintenance account.

I'm new here and been catching up on all this stuff. CRST Malone just seemed like a decent company from everything I've read here, especially from you. Thought maybe their L/P might be one of the exceptions to the rule. Guess not.

[tootie04]

We did lease purchase with Arrow for about 3 years. It is HARD to do. I wouldnt recommend it for just anyone. I cant speak for CRST since we didnt lease purchase through them but 1600 a week is ALOT of money!! at Arrow AFTER our deposits were paid (2800.00) they were taking about 1,000 per week. This was EVERYTHING except fuel. That included .07 cents a mile maint. program and our 571.00 per week truck payment for an 07 KW. Arrow pays by the mile and didnt charge us for the trailer use.

We have since wised up and bought our own truck. I cant believe the difference in income that this is going to be. I wish we had done this alot sooner but we had credit issues to deal with.

Anyway I would shy away from any LP with that much output a week or for that matter dont do it at all. BUT if he insists on doing this I hope you have a good job to make up for the weeks with no pay. Also PLEASE read the lease carefully.

good luck

tootie

[GMAN]

They don't cover anything. The mandatory maintenance account is set up for you to take funds out as needed. Should your costs be more than you have in the account you will need to come up with the rest of the money. The maintenance account is really designed to pay for a major expense, such as an engine overhaul. CRST Malone is not the only carrier that has a mandatory maintenance account. They all have a mandatory maintenance account. It is not insurance. It is a maintenance account set up so you will have the funds available when you need any type of repairs. They will advance the money but you will pay for your base plates and permits in ADDITION to any other costs. They deduct the cost of plates at about $75/week. You pay that whether you lease a truck from them or sign on as an owner operator. Keep in mind if you lease a truck from a carrier, you are not an owner operator. You are a lease operator. There is a major difference. Your lease payments will go on whether you run the truck or not. You cannot afford to pay out $800/wk, buy fuel and have much left over. You cannot just access the maintenance money anytime you want. You must get in touch with the person who handles that for the company. They usually work during regular business hours. I am not sure what you would do if it was after hours and you didn't have the funds with you to pay for the work. If you don't have your own tarps, binders, chains, etc.,

We have discussed this a lot on the forum. A lot of those who ask only want validation about a decision that have already made. I don't think the fleece purchase deals are good for the driver. If it were me, I would save my money until I had enough to pay cash for a truck or at least enough for a

Their recruiters are lying then, (surprise!) They are saying that you get a full bumper to bumper warranty that covers everything for the first two years. They say that it's not a maintenance account.

I'm new here and been catching up on all this stuff. CRST Malone just seemed like a decent company from everything I've read here, especially from you. Thought maybe their L/P might be one of the exceptions to the rule. Guess not.

I don't know if they have a warranty or not. Even if they did have a warranty, there are many things a warranty won't cover and will need to be paid out of pocket. I was leased to them for 3 years, but I went to them with my own truck. My experience was pretty positive and I left on good terms. But I would not want to lease a truck from them or anyone else, for that matter.

If you go with CRST Malone, you will need to buy tarps, straps, binders, etc., If you buy new, it will cost about $2,500. CRST Malone will finance it for you with 10% down and a fixed amount per week. A performance bond will also come out of your settlements. All of those charges add up to a lot of money coming out of your settlement check. You can do it if you don't have a big truck payment starting out. If you don't have the money for a down payment and or get your own financing, you will be much better off staying a company driver. Save your money and if your credit needs repairing work on getting things in shape. You will make more money. There are no short cuts to becoming a successful owner operator. There is a high failure rate among owner operators. It is even higher with lease operators.

[Ronp3501]

Hello I saw your post if I am also from NW IN. If your husband is still looking for a job please give me a call. We pull containers in the area and the companies we deal with are pretty good. We are a no pressure company and looking for good people. If you like please give me a call at 219-218-5336 and we can chat more.


Ron

[Rev.Vassago]

Hello I saw your post if I am also from NW IN. If your husband is still looking for a job please give me a call. We pull containers in the area and the companies we deal with are pretty good. We are a no pressure company and looking for good people. If you like please give me a call at 219-218-5336 and we can chat more.


Ron

Were you given permission to recruit here?

[mike3fan]

any update from the original poster?