trailer leasing – Blog

An owner operator or truck driver wanting an independent trucking business is a costly affair. The big rigs often cost too much for the truck driver job to realize their big dreams. A new rig and a trailer would require a big sum of investment ranging from one fifty thousand to two hundred thousand dollars. In this situation the truck driver turns towards commercial truck finance option. The finance companies are more than happy to offer commercial truck finance as this loan is far less risky. This is because of the reason that truck drivers make good money and has the potential to earn over one hundred thousand dollars in one year by running their trucks for approximately 70 hours a week. If they start the business in partnership with two drivers on the road then the amount earned is even more.

The types of finances covered not just include the big rigs which makes interstate trips but all other truck types used for different loads available as well. The other truck purchases that might require commercial truck finance are flat bed, dump truck, reefers, dry vans, hazmat trucks and many more. The area includes all those trucks and trailers that are commercially used to raise income. At this point of time many new owner operators and truck driver feel hesitated to take up such a huge amount of loan. Therefore, many starters go for another option which is more economic and practical i.e. of Truck leasing. In this case they take the required truck on lease for a certain period of time. This option does not require a big initial investment so the truckers can focus on other financial requirements until the business is perfectly set.

Rising fuel price is another challenge faced by both the owner operators and the truck finance companies. Where the fuel was costing 500 dollars some four years back now costs 1000 dollars. The investors are now looking for low cost finance options. The overall economy of the country depends on its fuel prices and trucking industry. According to estimation the trucking industry will face a shortage of 20,000 drivers by 2014. There are a few reasons why the truckers these days want to have their own commercial truck. The first one off course is the freedom to drive the big rig on your own terms and conditions. Many truckers don’t find the scheduled 10 or 14 hours a day job offered by trucking companies much fascinating. Moreover these days the new semi trucks are coming loaded with features like beds, microwaves, toilets, satellite televisions, and much more. So the aspiring trucker wants to get all such facilities with their own trucks.

Commercial Truck Finance options are not only limited to new trucks but are also available on used trucks and trailers for those who do not want much financial load on themselves. Many companies are coming into picture offering truck finances for new and used trucks. With the start up of the owner operator business you have the potential towards increased earnings. You can use the facilities of load boards to keep your truck always loaded. Thus taking commercial truck finance is a good idea for those truck drivers who cannot afford to buy a truck on their own but want to start up the o/o business.

For many drivers, working for a company may not be enough, and they always keep thinking of going ahead with a freight business of their own. However, these want-to-become owner-operators get discouraged when the face the reality about their financial potential. Giving recognition to such demands, many trucking companies have incorporated lease options, lease purchase and drive to own options for drivers who are not in a situation to fulfill their dreams through conventional financing modes.

The question arising here is whether leasing a truck would be able to bring you financial gain? The answer to this question mainly depends on your own conditions and the perspective you look from.

From the perspective of the truck driver, leasing a truck is the perfect option for them when they are not able to pay a hefty down payment and related start-up costs. Most carriers have come out with leasing opportunities for enterprising drivers, and thousands of drivers have been attracted by such offers. Although the terms vary from one carrier to another, but most of them claim benefits for drivers in a number ways, including low deposits, low down payments, sometimes there are no down payments, no long-term contracts, pride of ownership, chance to drive higher specifications equipment, incentives on completion of lease and convenient credit standards. This allows lease operators to enjoy the taste of ownership without involving high financial risks. Most of the carriers market their leases as ‘walk-away’ leases, which mean that drivers can walk out of the lease in case the set-up does not work for some reason.

Some of the drivers have experienced truck leasing as a financial loss. Contrary to their expectations of fulfilling their dreams, these drivers have come to experience limitations and malpractices on the part of carriers, like low mileage, baseless deductions and complicated lease contracts drafted to benefit the carriers. Sometimes, the carriers tend turn the advantage of truck leasing completely in their favor. In such cases the drivers end up owing more to the carriers than they have been able to earn from their driving. Some of the main complaints recorded by drivers about their leasing carriers include large payments, over-charging for fuel taxes, inflated insurance fees, huge deposits, repair accounts and carrier-dictated repairs with rates decided by the carrier.

In addition to these complaints, drivers also charge that the method to clear repair and tire reimbursements is mostly not mentioned in the lease agreement, and sometimes the carriers make it almost impossible for the drivers to get these funds by fixing very high limits for minimum expenses.

And to aggravate the scene further, many carriers who promise a ‘walk-away’ lease, fail to release the funds collected from the drivers for deposits or repairs, in case the driver wants to leave the contract for any reason. Such experiences have led to the drivers questioning whether truck leasing opportunities are real opportunities or simply an easy way to a more complicated financial disaster.

Even though there have been instances that prove that leasing a truck may be a big gamble for drivers, but another side of the same story reports that there are numerous truck drivers who have turned their logistics business into a profitable enterprise. Therefore the drivers are primarily left with their own conscience to get to their personal conclusion.