Lease Back Programs???

[gregdennis53]

I have no idea whether I am posting this to the correct forum, but here goes, and if somebody can suggest another forum or the Mods want to move this, please do.

I am not quite to retirement age but beginning to think about the perfect retirement RV. I was at a Sportsman Show over the weekend and met with a guy who does "purchase lease back" programs. As I understand the deal, I would buy the unit and place it with him. He would lease it - if possible - and we would split the proceeds according to a formula. I would get various tax advantages (depreciation) which would be nice since my current pre-retirement income is fairly high. After 1 or 2 years, I would reclaim the RV and be able to use it for my retirement.

I have the money and this sounds very attractive. My wife and I have our current RV so we would not need this "lease" unit for a year or two.

Anybody with experience or words of wisdom?

Thanks and Happy Camping!

[peaches_cream]

You have heard from all the nay-sayers, who have no idea what they are talking about. If your investment is covered by Insurance for damage done to it, you can come out well ahead. I purchased a Condo 8 yrs. ago in a resort area. Rented it out during the summer and used it during the fall and spring. Did not cost me a penny, in fact, actually made about $11,000 during the period. Just sold my part for what I paid for it 8 yrs. ago. If rental property was as bad as some make it out to be, no one would be able to rent.

[M_GO_BLUE1]

STEP AWAY FROM THE COMPUTER....

[tmarrs]

I own an RV rental company, so I am very familiar with this system. While this is a good way for you to make money - I would NEVER recommend buying a new unit to do this with. If you want to earn income from a leaseback program, buy a used Class C for about $25-30k cash for the program. Every market is different, but that would earn you about $13-$15,000 a year at my place. In 2 years your RV would have paid for itself, and the next two years is pure profit. Then you sell your RV for about 50% of what you paid for it and could potentially pocket $40-$50,000 total in 4 years.

Like others have said - make sure the company has the good commercial insurance that provides the insurance on the unit even for the renter - that way you don't have to worry about their insurance. Expect that small things are going to get broken and replaced, and your unit will not look the same after 4 years... that's why you would want to buy an RV as an investment to use and sell - don't do this with an RV you want to keep!

[elkhornsun]

The charter yacht industry has been doing this for decades. It gives the charter company boats with no capital outlay. For the boat owners they get the boat back after 10 years and then have something with very little value and nothing close to a good investment.

The RV rental outfits I have dealt with replace their vehicles before they are out of warranty and some may do this on a factory lease program if there are tax advantages for them to do this. I cannot see where it is a good idea for a private party to get in the middle. It certainly seems foolish with the huge rate of depreciation of RV's in general.

With anything like this it pays to sit down with your CPA and run the numbers from this company and to read the fine print and see if the projections are reasonable.

[tahiti16]

Jim Shoe wrote:
The only person that has no skin in this game is the guy that's going to lease it for you. His down side is no income if he can't lease it.

Well at least in the contract we had they still paid their half of insurance, maintenance and did the advertising and manned phones etc. So they have a vested interest in keeping stuff rented not sitting on a lot that also costs money.

[Jim_Shoe]

The only person that has no skin in this game is the guy that's going to lease it for you. His down side is no income if he can't lease it.

[tahiti16]

We did this with our first motorhome back in 90.We knew we would not have time to use it a lot so it would have spent a lot of time sitting beside the house.

We never intended for it to become our motorhome to travel where ever and be what most of us have, a house with wheels at our beck and call.

It worked for us for the most part, at least until the original dealer/lease company went bankrupt owing us over $3K! We were fortunate though nothing was damaged and the coach was in good shape.

Leased it back out after 6 months through a different group and that worked ok too. In both cases there was a commercial insurance policy with $1million liability on it.

Read the contract closely if you decide to do this so you know exactly what who is responsible for, like maintenance, license and repairs.

If your plan is to take it back after 2 years to use as yours I would wait 2 years and either buy a 2 year old coach or new at that time.

What the leaseback accomplishes is giving you some income and tax advantages with limited personal use. You are not leasing out your house that only has systems that most people understand, this they have to drive down the road and miss stuff, operate systems they have never used before etc.

[woodgeezer]

Run Children Run!!!!

[bukhrn]

This guy that proposed this rediculous deal, is his name I.M.Slick ?
Making money is the last thing you'll do,getting migraines is the first.:S

[H345]

.

NO !

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[monkey44]

Well, seems like all NO so far - and so will make it unanimous... Can't even imagine anyone I know use my brand new RV, let alone a buncha strangers.

I feel like taking a shower just thinking about it...

[wny_pat1]

Do these people who are renting your "perfect retirement RV", give a darn about it being perfect. I can almost guarantee it will not be perfect when you finally get it back and around to using it.

[dspencer]

JMHO but it has a scam sound to me. But that aside like everyone else says i sure wouldn't want anyone and i mean no one to use my trailer.

[Francesca_Knowl]

Step back a minute and ask yourself:

If this is such a great idea, why isn't the guy you talked to using his own money to buy the rental unit?

I'm betting that he's the only person that would come out ahead on an "OPM" deal like the one he proposes to you!