Schneider lease purchase vs buying new vs buying used

hello welcome to big rig CEO I'm James - Zhang and this is gonna be my third video this week because the second video I put out this week I realized had some misinformation in it and it's important to me that you get the right information all the time not some of the time especially with the amount of misinformation that's out there so I had a video up I took it back down because I made a mistake in my math since then made a few phone calls gotten things straightened out I've gotten some better more solid information and so here we go today's video I'm going to talk about the difference for a first-time buyer in buying a used truck versus a new truck versus police purchase so you can decide whether or not lease purchase is a ripoff okay so now that I've made some calls and what I did was I called around and talked to the finance department at three different Freightliner dealerships mainly the one that I do lots of business with back in my hometown and here's what I found out if you were to buy a truck similar to mine which I paid 145 five for and it had 27,000 miles on it so it was virtually brand-new but I'm gonna assume for the sake of argument that it's going to cost you about the same to buy a brand new truck from a Freightliner dealership you are looking at putting no less than 15% down on your first truck usually it's a lot higher than that it all depends on your credit score but I'm gonna assume that you have a 750 or better probably hopefully closer to 800 if you're really considering doing that and anyway 15% down so if you put 15% down on a hundred and forty five thousand five hundred dollars you're going to put down twenty one thousand eight hundred and twenty five dollars you're going to then have to finance the remaining balance of a hundred twenty three thousand six hundred and seventy five dollars over seventy two months at a rate and this is what they told me when I called a starter rate at eleven percent depending on your credit now can you get a commercial loan for a lot less than that maybe you know somebody that I don't know I don't know but if you're going through the dealership you can expect a rate no less than eleven percent on a commercial truck loan right now which means on that one hundred twenty three thousand six hundred and seventy five dollars over seventy two months you're going to pay a hundred and sixty nine thousand four hundred and ninety one dollars now and you add that to what you put down you're going to wind up over a six year period of time paying one hundred and ninety one thousand three hundred and sixteen dollars for a brand new Freightliner Cascadia evolution should that be what you decide to buy and like I said for this video I'm going with what I have now the other side of that coin is you can go buy a used truck a used truck right now three years old less than four just about under four hundred thousand miles for a Freightliner Cascadia evolution you're going to spend about seventy one thousand dollars plus plus if you want an extended warranty that will be extra because most likely it's not gonna have any warranty left so let's choose to go for the sake of argument that you're not going to buy the extended warranty the first thing they're gonna want for a first-time buyer is 25% down 1,700 I'm sorry seventeen thousand seven hundred and fifty dollars down leaving you a remaining amount to fifty three thousand two hundred and fifty dollars that you can maybe go down to your bank and finance at let's say six and a half percent at six and a half percent over a three-year period you're gonna pay 58 thousand seven hundred fifty four dollars plus the seventeen thousand seven fifty that you put down for a total of seventy six thousand five hundred and four dollars for that truck over three years but it's a used truck and if any of you know anything about used trucks you know that most likely if it's used it's going to be a fleet truck from a mega carrier of some sort and you know anything about the way these mega carriers take care of their trucks you know they absolutely do not take care of their trucks they don't serve a cement to correct intervals that Alou bum at the correct intervals they may not even do an overhead at the correct interval the reason why is they're not intending on keeping this truck to go 1.5 million miles they're intending to keep this truck for 400,000 miles and then put it out and get new trucks and then you wind up buying one of these trucks that hasn't been serviced properly and is more likely to have maintenance issues and possibly break down so what I did was I factored in over that three-year period of time the fact that you're gonna pay at least $20,000 a year in maintenance because that's the nature of it and I'm going to guess and I'm going to assume that that's about the average cost which means that you're going to wind up paying an extra $60,000 in maintenance on top of the 76544 that loan now it's a lot riskier in my opinion because you don't know what you're gonna get and you can pretty much so assume that what you're gonna get is a truck that has not been maintained properly now are there exceptions to the rule of course there is there's owner-operators out there that have bought a truck and babied it from you know mile one up to four hundred thousand miles and you might get lucky and you might get one of those trucks but the odds are not in your favor so there's the third option which is the option I went with at least this brand-new truck that had 27,000 miles on it that's brand new to me I paid one hundred and forty five thousand five hundred dollars I didn't have to put a dime down nothing zero for the first three years I'm gonna pay eight hundred and nineteen dollars a week that's gonna come to one hundred twenty seven thousand seven hundred and sixty four dollars then I'm gonna have a fifty six thousand dollar balloon now I've spoke to my bank and I know that I can finance that $56,000 balloon when I walk in there with three years worth of taxes the fact that I've been in business for three years for about six and a half percent but for this video we're going to assume that I can't do that and I've got to grab a commercial loan and that that commercial loans going to cost me the same 11 percent that the first-time truck buyer has to pay interest on if he buys a brand-new truck so fifty six thousand and eleven percent over three years is sixty six thousand and one dollars one hundred twenty seven thousand seven sixty four plus the sixty six thousand and one dollars comes to one hundred and ninety three dollars one hundred ninety three thousand seven hundred and sixty five dollars now if you remember earlier in the video I said that a first-time buyer over a seventy two month six year life of a loan at eleven percent was going to pay a hundred and ninety one thousand three hundred and sixteen dollars I'm gonna pay a hundred and ninety three thousand seven hundred and sixty five dollars at the same interest rates that's a difference of two thousand four hundred and forty nine dollars and I got a brand new truck with a warranty and I'm not gonna have all those extra maintenance costs and major breakdown costs for the first three years of my business because I'm under warranty plus because I bought it through SFI my truck has a six hundred thousand mile warranty and that includes the DPF system which is awesome because if you know anything about DBF systems you know it's going to go down on you if you hire your truck for more than an hour anyway I don't know if it's worth it to you to pay the extra twenty four hundred and forty nine dollars and not have to put 21 thousand eight hundred and twenty five dollars down but for me it would it was totally worth it I put zero down I lowered my risk by not having to get a used truck and I only spent twenty four hundred and forty nine dollars more than I would have had I had gone down to the dealership and had I a financed a brand new truck over seventy two months anyway I'm interested in what you think do you think after hearing that information that lease purchases a ripoff put it down in the comments below I really want to know what you think for those of you who watched the second video I put out this week which has now been taken down because my mass was a bit off my apologies I'm hoping that you'll watch this video and comment again but I really really really did not want to put misinformation out there there's a lot of misinformation out there and I don't want to be part of that so like I said leave a comment down below also if you haven't subscribed to the channel please hit subscribe button smash the bell so you can get in on future videos if you need to get a hold of me big rig CEO at gmail.com and as always keep your wheels on the ground oh yeah one last thing I recently started a Facebook page I'm putting a link down in the description you can simply go to your Facebook account type in up there in the search bar at big rig CEO it'll bring you right to my page you really want to get that page going I need some lights if everyone who watches this video and just hit a like I'll get there a lot quicker anyway again keep the wheels on the ground

Channel: Big Rig CEO

Views: 26,714

Rating: 4.8963923 out of 5

Keywords: Schneider Owner Operator, Schneider Choice, Schneider pay, Schneider IC, trucking, transportation, trucker, Schneider lease purchase

Id: A_XwBefTvcA

Length: 10min 45sec (645 seconds)

Published: Wed Mar 06 2019