Lease Purchase Contract Woes

FAST JIMMY · Aug 17, 2006

I purchased (or thought I was purchasing) a vehicle from a person that had a truck listed on this site. We came up with an agreement.I gave him required deposit. Both of us signed it. Then after a couple of settlement errors with my carrier, they put my whole settlements in sellers account. which was only to be a % of total. I figured it would be ok and that "extra" could be taken off total owed. Wrong. Then seller decided it would be easier for me to make payments directly to bank that was holding his note until I paid it off. So kindly I gave him more "extra" money to put towards balance until payment book arrived. When payment book arrived I paid payment on time, next month also on time. Then email from seller telling me no payments were made. Bank would not talk to me about account but finally agreed that payments were made but delayed due to different name on check,but correct account #.Then made 2 more payments on time with same outcome, Seller telling me I am up to no good and he wants the truck back.I was so upset since I invested a lot of money towards purchase and also many required repairs on truck. I went to my bank and qualified for complete loan amount.Which the seller told me to send the balance owed to him and he would get me the title. I am not that stupid. The payoff was almost double than what he firt told me. I still agreed to pay the whole amount. My bank has had all money and paperwork on thier desk to payoff his loan so we could all move on. That was over 3 weeks ago. He won't cooperate with bank or me to sign what is needed so he can get his money. Now he says he wants me to bring truck to a truckstop and park it. I don't know what to do. I would walk away but I have many thousands of dollars into a deal that should have been completed. Any input would be helpfull. Sorry for long post but a lot of info.
Thanks again.
Fast Jimmy

davekc · Aug 17, 2006

Based on what you are saying, the bank owns the truck rather than the owner in which you are dealing. I would set up a meeting with the bank officer or president and the owner to get everyone on the same page.
If the owner refuses this type of arrangement then I would become suspicious. A call to OOIDA is time well spent as well.
Lastly, I would bring a attorney into the picture if it can't be resolved with the above.
Small claims is an option but it sounds like you are on a limited time schedule and possibly have past your states limitations on claim awards by the time you could have a court date.

Davekc
owner
22 years
PantherII
EO moderator

greg334 · Aug 17, 2006

I would bring in the lawyer now instead of waiting.

joebob1_30132 · Aug 17, 2006

dude .this I believe is old dance number.performed over the years by hoodwinks who you have just made free payments for ...It happened to a friend of mine.in the wrecker business.. owner of the truck said he would sell the truck to him..he just had to make the payment to te bank.. the bank held the note ..and dont care who pays..hope you payed by checkk// goten a written agreement.. but your check copy may work.... as proof to some agreement .... and now the big turn around.. owner claimes you are hood winling him..probably acting mad and incredulous... go after him, hard ..small claims court...

FAST JIMMY · Aug 18, 2006

I am going to try again today to get owner on the phone and then call bank on threeway. And see if we get anywhere. He has not returned my call or from my wife. I can't even think what he is trying to pull. It could be paid off immediatley or repoed and bad to his credit. I wish he would quit avoiding my phone calls. I tried once to get him to talk to my bank so he would know how far along our loan was. But when I hung up and tried back with my bank on the line he would not answer. In the meantime I am afraid to drive it as he has threatened with throwing around Troopers names that do not exist.
Thanks,
Fast Jimmy

tec1959 · Aug 18, 2006

Jimmy I hope you get It straight,This guy sounds like a low down bump.Also I know hine site Is 20/20 lol,But maybe you should of bought the truck out right and not did a lease.So many times the buyer gets the shaft on them lease purchase deals,and the owner/seller makes out like a bandit...Jimmy Good Luck....

bernieh48 · Aug 18, 2006

My question is on the original contract with the owner did you get it witnessed and notarized? I know that won't help now, but as long as you have you cancelled checks and the bank finally saying you did make the payments then there should be a clause in your lease agreement with this guys that the only way he could ask for the truck back is for non payment. What Davekc said is true. Call an attorney, and OOIDA. We got really screwed by doing one of these contracts and the owner was supossed to make the payments and the truck got repoed right out from under us because she didn't make the payments at all for 6 months. Then she took off for Germany with all our money. Hope it all works out for you!

kwexpress · Aug 18, 2006

KW Express
o/o till i die

call a lawyer now.troppers wont come after you cause you have the signed lease agreement and checks.they will tell him its a civil matter and if he wants his truck back he will have to get a lawyer to.

I know I have been into this type of situation before.there are alot of owners out there that sell trucks many times over and always try to blame the other guy.

Ive been on both sides of these deals first off its illegal to sell something you dont own and could mean criminal charges on him and you get back what you paid. or he will come up for air and let you have the truck for payoff.if truck payoff is more than what your contract amount was for then I would payoff truck and sue him for the difference.but Im no lawyer get professional help.

I had a deal in MI one time and the state of MI says contracts are illegal for this type of deal.

had one in KY once it was legal so I guess it depends on what state the sell took place

Vinnie T · Aug 18, 2006

It's all about the language of the contract. Take your contract to a lawyer to see what you can do in this matter.

In the future...before anyone signs any of these contracts I would take it to a lawyer to have it inspected. Obviusly the contract will be written so the Lessor will basically do what he/she pleases. I would then make an amendment to the contract in order to protect yourself. I would also try to input guarantees of miles and rate the Lessor must provide the Lesse. Reason being IMO it seems most of the time,(not all the time)drivers under these contracts just get enough miles to pay thier truck payements, taking the burdon off the Lessor. The Lesse seems to get frustrated turning the truck back in after spending thousands of dollars paying the guys truck payment for him. If the Lessor has honest and good intentions, he/she will take you amendments to the contract seriously. At least I would!

greg334 · Aug 18, 2006

A little bit of advice for Newbies.

When ever you deal with a truck purchase, becoming a driver for a fleet owner or going into a lease/purchase - bring the contract to a lawyer who can go through the entire contract with you to explain it to you. If the person you are dealing with says no, walk away. There is no reason under the sun that someone should say no unless they are out to do something wrong.

In addition to this I would also write questions down to ask the person you are dealing with to ask them so there is no misconceptions.

I got to tell you if you spend $200 or $300 for the lawyer is better than losing thousands and time with a bad situation.

I know one fleet owner who has a cheat sheet (his terms) that breaks down the contract to simple terms, provide the lawyers name who wrote it and sources to find a lawyer who can check out the contract. He is serious about the success of his drivers.

bryan · Aug 18, 2006

HI

Since the truck has a lien against it through the bank, the owner can not lease the vehicle.Been there done that, bank threated to sue me.Banks take this kind of stuff very seriously.

The owner is probably avoiding you because the bank has called him making threats.Or he called an attorney and the attorney told him not to contact you.You see the agreement between you and the truck owner was illigal.This is why you should contact an attortny before signing an agreement.He could of told you and the owner from the beginning that what you were doing was illegal and could of showed you how to do it legally.

He should give you back your money or hire you as an employee (not a contractor)this is how we got around the bank.As an employee you can be given power of attorney over the vehicle.With out the POW you wouldn't even be able to plate the vehicle or insure it.

So its best to stay away from lease agreements,but if you must get one make sure that there are no liens against the vehicle.Both parties need to sit down with a lawyer.The lawyer will check to make sure there are no liens and that the contract is legal.

davekc · Aug 18, 2006

Lease purchases are a bad deal. I have never seen one of these go to term. If someone is lease purchasing a vehicle to a driver, it is because of the following,
1. They want to steal you blind either through the truck payment or excessive interest
2. They are upside down in the loan and can't get out from under it.
3. Overpaid for the truck and now have no driver(s)
4. The truck is in need of repairs or is on the verge of a major repair.

Lease Purchases are a bad deal. In case there is some confusion,
Lease purchases are a bad deal.
One more time.......LEASE PURCHASES ARE A BAD DEAL

Davekc
owner
22 years
PantherII
EO moderator

Broompilot · Aug 18, 2006

Brian you are incorrect, as long as the payments are made that is ALL the bank cares about. It is not a home (FHA, VA, or otherwise) its a truck. It may be illegal in some states but not wrong enough to call a loan if payments are made.

Now anyone with any common sense would not step into ANY AGREEMENT with a note (bank or otherwise) tied to a title. A lawyer is highly adviseable.

WE ARE BEATING A DEAD HORSE AND YET THERE ARE NOTHING BUT SUCKERS every month adding to this thread that keeps comming back. To the original poster you failed to do any home work this warning sign has been posted over and over again on how these deals ALWAYS FAIL I have never seen one completed to the very end by either party.

How could anyone step into such a deal with a total stranger tells alot about theIr business sense. Sorry to be so blunt but you got what you played with, you choose to play the cards with out doing your homework and the game has been played over and over on this site if you would have only taken the time to look before you entered the game. Hate it for you, the history has been played by you one more time wish you well but your probably gona be another victim of a crooked owner with no recourse unless you got deep pockets to retrieve 0 since you played with a LOOSER..

Tennesseahawk · Aug 19, 2006

I've gone thru the same thing. Actually, still going thru it, in court. I wouldn't totally dismiss the idea again, but if I did do it again, the contract would be solid! I've lost a buttload of money doing this without an iron-clad legal document. If you are taking over payments, demand a copy of the reciept from the lender. In my case, he was making the payment but pocketing the rest.

ATeam · Aug 19, 2006

I recently watched a truck seller and truck buyer run the truck through a dealer to complete the sale. All pre-arranged, the dealer took the truck in on trade toward another truck. The buyer immediately purchased the truck from the dealer.

I do not know if it is possible, but it may be worth looking into. The concept is this: all pre-arranged, the seller sells the truck to a dealer. The buyer immediately purchases it. The dealer marks the truck up a bit for his or her trouble. Both buyer and seller receive the peace of mind of making a clean deal. I would think that peace of mind would be worth the dealer's markup.

tazman · Aug 19, 2006

Hi Phil,

What you referring to is called a "courtesy trade"..in the business lingo.

It usually done when a buyer has a trade vehicle that he has already contracted or agreed to sell to a someone else.....

We do this a lot for our good clients.....

We generally take a fee around $250 or so to do the deal.....What makes it work for the dealer...is that the business office will sometimes secure financing for the "traded" truck as well as financing for the new truck that is being sold.

The dealer actually has to take title of the "traded" truck (in the form of a dealer title)...and then assign it to the new owner or list an encumberance to a financial institution...if it is being financed.

Everybody wins in that scenario...usually !!!!

The original note regarding the Lease-purchase deal is interesting to say the least....

The owner who financed the truck to the bank..probably signed a promissary note to pay the loan ...which probably had conditions as part of the term with respect to how the truck may be used....
Usually in commercial truck transactions...those terms will often times prohibit the signor from "leasing out the vehicle"..or will have verbage that indicates that prior approval would be required to have an arrangement like a "lease out"...What's more the owner is required to carry the insurance on the vehicle during the contract term.....Since we don't know in this case...who was paying for what we can only assume.

Further banks will generally accept payments from a third party to satisfy the contractual obligations of a loan..provided terms are satisfied...

And lastly...with the new banking privacy rules in effect...it really become difficult to get any info regarding payoffs and such from the lending institutions...hence the problems that was stated in the original note....

Anyway....just throwing a few cents (or sense) in here...

Thanks,

Frank in PA

davekc · Aug 19, 2006

Taz..
Excellent post with accurate information. We have a attorney facilitate all of our transactions. We just sold a DR unit and it went very smooth and was a comfort for the buyer that he had direct contact with a bank in FL as well as our attorney. It was a clear title but he needed financing and through the attorney and my bank it was no fuss no muss. Roughly the same price as you indicated. $200.00 got it done from start to finish.
I always recommend this if escrow money is involved. In our case it was, and it takes the stress out of both ends.

Davekc
owner
22 years
PantherII
EO moderator

letzrockexpress · Aug 19, 2006

Fast Jimmy, hopefully now you get the idea....get a lawyer!!now!!
If everything you say is correct and you have it in writing, you need to act quickly to get this mess resolved. Technically this guy cannot sell you a vehicle (lease purchase or otherwise) if someone other than he holds the title!!If I were you I would post his name and exactly what he has done to you so that no one else here gets swindled!!!

FAST JIMMY · Aug 20, 2006

Wow, thanks for all the posts and info. I finally talked directly to a supervisor at the sellers bank. I could not get any help through 800 number customer service. I called a branch and got some answers. They do not care who makes the payments, even though my current payments got lost in the banks system because my name on the money order did not match loan, but I did put loan number on it. The seller did tell the bank to put me on a list to obtain loan info, but they said even a spouse can not get info anymore. I am waiting for a fax from the bank ,which they said I should have by Monday or Tuesday. Then I hope things will soon be done. My bank is going to fund the payoff of sellers loan. That way all legal things to be done with the title will between the banks. Making it easier for myself so I won't have to deal with the seller anymore. I will post when I hear from the bank.
Thanks again,
Fast Jimmy