Lease-Purchase

blucolr · Apr 9, 2005

Called A private owner about a truck he had for sale. He said he wouldn't sell it out-rite but would do a "lease-purchase" arraingement on it, adding that a 80-20 split was the norm. I told him I was looking for an out-rite purchase, but would keep him in mind. Please enlighten me, O wise ones! What are the +'s and -'s of this type arraingement and how should it be structured. An example would be good also!
Thank's
Mike

davekc · Apr 9, 2005

The word Lease or fleece is not something I would enter into as far as expediting, unless you just filed bankruptcy, I would see no reason to do it unless of course your the owner.
Why would a owner prefer this over selling the vehicle outright?

Simple. He is upside down in the loan and can't sell it outright for what is owed on it.
Or, he wants to take advantage of a new inexperienced driver
Or, if he sells it he can't pay the capital gains tax on the sale.

If the truck is being sold for 50 percent or less of its value then it might be something to consider with the aid of an attorney.
Over the years we have bought numerous trucks and seldom do I see a lease deal that is in the drivers best interest.

Whether a driver or a company, a rule of thumb to follow is,
If it was that great of a deal, they would be buying the truck themselves.

In your specific case, the owner is charging you 20% for the truck.

I wouldn't just walk, I would run from this kind of deal.
Davekc
owner
20 years