How Do Lease-Purchase Truck Programs Work?
How do lease-purchase truck programs work? It’s important to recognize that not all of these programs are the same, so you’ll need to consider each program’s terms carefully. However, getting a general overview of these programs and what you need to think about if you’re interested is a great way to start preparing.
What Happens with a Lease-Purchase Truck Program?
As Zippia explains, the basic framework of a lease-purchase agreement is fairly simple:
- Choose a company with a desirable lease-purchase agreement truck program.
- Make monthly payments as required by the contract until the lease agreement is fulfilled.
- Drive the truck during the contract. Depending on the terms of the contract, you may drive as an independent contractor for the company that you’re leasing from, for other companies, or both.
- Complete the payments on the truck to fulfill the contract and take full ownership of the truck.
Are Lease-Purchasers the Same as Owner-Operators?
While lease-purchasers are working towards becoming owner-operators, they aren’t quite the same. Owner-operators own their vehicles outright.
What Should You Consider Before Opting for a Lease-Purchase Truck Program?
According to Freight Waves Ratings, there are lots of things to consider before you take the plunge into a lease-purchase program:
- The truck. What kind of truck do you want to buy? Remember, the type of truck you select will determine what type of loads you can haul. Will you purchase a used truck or a new truck? Are you ready to handle its maintenance and repair needs when it’s time?
- The contract. Not all lease-purchase programs are equal. Some are heavily weighted in the favor of the carrier. Before signing anything, read the contract carefully and compare it to others in the industry so that you can be sure that you’re getting a fair deal. Learn whether you’ll need a down payment and who is responsible for repairs, insurance, and fuel costs, and clarify ownership of all equipment. Keep a wary eye on the payment schedule, and be mindful of any balloon payments.
- The office work. Being a business owner means accepting the responsibility of a certain amount of paperwork. Are you ready to handle your own accounting and compliance paperwork? Don’t forget that you’ll need to file your taxes as a self-employed individual if you work as an independent contractor.
- The business angle. While driving for the company you’re leasing from, work will be provided. Once the truck is paid off, you’ll be in the driver’s seat when it comes to selecting your jobs. Are you prepared to network and hustle to find work?
- The compliance angle. As a driver, safety on the road is clearly important. After all, you want to get home, and you need to maintain your professional driver’s license. When you become a business owner, compliance concerns reach a new level. Failure to maintain a good CSA score reflects on you as a carrier. You’ll need to go beyond a driver’s understanding to optimize your performance. For example, investing in a quality electronic logging device can prevent errors that might cause hours-of-service violations.
- The job choices. If you choose your lease-purchase truck program wisely, you’ll have a fair amount of freedom to choose your jobs. This can be freeing and intimidating. Leasing from a company that has a load board where they post plenty of work can make this easier. It’s reassuring to see that there’s work available. The workboard also allows you to sign up for your next job while you’re on the road, which minimizes downtime.
Are you interested in a competitive lease-purchase truck program at a great company? Be sure to check out BLC Transportation. Our driver-friendly culture is an ideal fit for entrepreneurial types. We have steady routes that will keep you rolling and offer lots of great incentives, including a free lease payment after one year of service. Contact BLC Transportation today to learn more.