Lease Purchase: Things To Be Aware Of Before You Sign On The Dotted Line!

Should You Lease Purchase

By: Heidi O.

More and more companies are pushing their drivers to lease from them. Be aware of what you are getting into with a company lease. The following are some things to be aware of when considering doing a lease or a lease purchase (this is in no way a complete list, but a basic start, as many things can arise in trucking!):

1. Will you be able to get the miles to make the money you need to make the payment? A lot of companies promise so many miles when you are talking to them about leasing, but when it comes down to it, can they actually make sure you get those miles? Will they sabotage you and prevent you from getting enough miles?

2. Does the company you are leasing from keep a maintenance account for you, or are you responsible for making sure you have some money set aside for maintenance? If you need to be sure to have a maintenance account, make sure you allocate at least 15 to 25 percent of your pay to a separate account for maintenance.

3. Will you be responsible for filing your Form 2290 Highway Use Tax? If you are responsible, make sure that your have applied for you Federal Tax ID number at least two weeks prior to filing so that you are able to apply online for your 2290 and you don’t have to go to the income tax department in person.

4. Does the truck payment come directly out of your settlement from the company? If your truck payment comes out automatically then you have nothing to worry about. If your truck payment is not automatically deducted, make sure you allocate a set amount each week to be sure the payment will be in the bank on its due date.

5. Will you be able to book your own loads or will you continue to be dispatched? If you will be able to book your own loads, does your company provide a stable load board for your use or will you have to use any load board you can find? Do you know what you will need to make per mile to run your own business? If the company dispatches you, are you able to decline loads?

6. Read over your lease CAREFULLY! Be aware of what is expected of you such as maintenance, fees, and most importantly, is there a balloon payment at the end that is so unrealistic that you have no choice but to sign a new lease with the company and keep on making payments. If you don’t believe that at the end of the term that you can possibly make the balloon payment, then take some time to seriously consider the lease.

If you think anything about the lease doesn’t suit you or you aren’t comfortable with the terms, WALK AWAY! Leasing is not for everyone, even though companies will try to push anyone into a lease.

If you do have questions about the lease, the best advice I have heard is to consult your OWN attorney!

Remember, leasing a truck from a company is in effect turning YOU into a business owner. If you aren’t prepared to run your own business, then reconsider leasing any truck from any company!