[quote="devildice"]That was my thought as well, hence my question, where are his sorces of statistics.. and I'm still waiting to find the stats that show the percentage of failed leases purchases versus succesful. Everyone goes off about how bad they are on here, yet noone has any stats collecte to back up the statement.. Guess opinions are like...... you know.

 

Whenever someone uses themself or someone they know as evidence I put on my earplugs. We are dealing with aggregates and not a handful of individuals.



Having worked with an investor that bought several pre-foreclosures, I know that the majority of the defaults in my area, which has one of the highest rates of foreclosure, comes from people that have no money down loans. It is so bad in this area that legislation was introduce to prevent the so-called predatory lending that is associated with no money down programs.


Quick google search on the subject, but not complete:

Evidence, including several reports from the HUD Inspector General, suggests that no-down-payment mortgages have significantly higher default rates than those where borrowers were required to use their own funds for a down payment.

http://www.heritage.org/Research/Budget/wm529.cfm

 

Its like frosty said, with L/P you are taking on proverbial truckload of additional risk with little or no extra reward.

Its a rigged game that the house cant loose. Heads you "win" and net the same or a bit more than what you would earn as a company driver. Their freight gets moved or the same or lower cost. Tails you sink in a stormy sea of freight claims, equipment breakdowns and high fuel prices and they repo their truck and lease it to the next sucka.

Lets say the management of the outfit you have a LP with takes a big dose of stupid pills and looses a bunch of customers. As a LP you are tied to the company with chains and you sink with them.

A a company driver with a record free of repeated boneheaded mistakes you may miss a couple of weeks pay as you change off, but then its rock on with someone else.

I would love to see some hard data on what the mean and median LP driver nets an outfit like CRE.

Do what ever you think is best for you..but please do it with your eyes open.

 

I think we'd all be surprised to find out what the mean and median net from any company off any driver is.........and I like your last statement...........what's best for one isn't all ways best for somebody else, there just isn't a one size fits all solution in this industry and we all need to keep our eyes wide open in this industry.....in more ways then one!

I'd wish all good luck, but I honestly believe luck doesn't have a thing to do with it.........instead, I'll wish you all the best you're willing to make happen.

Be safe out there folks..............we got another big storm center rolling into the plains and it ain't looking pretty.

 

There are several problems with a lease/purchase arrangement. The single largest one being you are locked into one carrier. While a lease agreement you can change carriers.

Another problem with the lease/purchase arrangement is the matter of gaining value in the equipment. If you do not own the truck at some point you have gained nothing. In fact you have lost money. Yes you can deduct the full amount of the lease each year but that amount does not offset the lost.

Another factor to consider is the price of the equipment. In most of these lease/purchase arrangements the equipment price is higher than the same unit purchased from a dealer. As an example and I'm not suggesting you deal with any dealer look at Selectruck program. I don't know if they still have the $999 deal like they did but I'm sure they have something close. In this program you are getting a truck with a much lower monthly payment that you own in a few years.

Many of the carriers have programs for such things as insurance and reserve accounts you can join.

I suggest for anyone thinking about doing a lease/purchase they join OOIDA and get their input. Even for someone leasing on with a carrier before you sign the lease have it reviewed by OOIDA. That is one of the benefits OOIDA provides.

With the high failure rate of O/O every good piece of information you can find will help you make the final decision. While some O/O will make it most will not. You have to look at it as a business all the way. You can not allow emotions to effect that decision.

kc0iv

 

I agree, this is another thing that has held me back.

I think you're thinking of a strait lease. While yes in a LP you pay more for he tractor, at the end you pay a baloon and you own the tracktor outright. So therefor "ALL" is not lost.

Still not commig out as good as an out right purchase, but still own the truck payment free.

 

What you fail to take into account is WHAT you end up owning at the end of a lease purchase agreement. You end up with a truck that is likely run down, with excessive miles on it (due to the fact that you had to run extra hard for the term of your lease agreement to cover the costs), with no warranty, and likely running very close to needing major work done.

The driver (you) are likely in the same situation. You probably don't have the finances to cover the major repairs that are looming for that worn out truck, as you weren't making any more than a company driver for all those years, and as some people have said, may have even been making less.

So what do you do? Exactly what the company wants you to do. You roll over that truck into a new lease purchase agreement, and continue to tow the company line, and never get out of the vicious cycle. There is a reason that the companies who advertise L/P agreements do so with such enthusiasm; it creates a much higher return on their investment, and allows them to have more flexibility in negotiating rates. So the company you lease that truck from should be thanking you, as well as every other lease purchase sucker out there, as it allows them to undercut everyone else on your shoulders.

 

have you ever done a lease purchase program?

 

I don't know for sure about CRE but I know Prime doesn't give you an option to buy the truck. When the lease/purchase ends they require you to sign a new lease/purchase and they give you a another truck.

Going by spencerian statement "This is a 2 year lease. I do not own it." It would say CRE doesn't have a buy-out option.

As far as a true lease agreement when the lease ends most leasing agreements give you the option of doing the baloon deal or turn in the truck.

In addition most lease agreements do not require you to lease to a certain carrier. You are free to change carriers as you see fit.

To me the best thing for a person who wants to buy a truck is to set aside money for a couple of years then buy a truck through a regular source. During that time learn as much as he/she can about trucking. In a couple of years he/she may decide owning a truck isn't really what he/she wants to do. If that is the case he/she has build a pretty good investment in a saving account they can transfer to a better saving plan.

Have a safe New Years.

kc0iv

 

I never bought swamp land in Arizona,but I know it is a scam.