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Donna Ryun
Information Services

Question: Since reading the I-376 series of articles in Land Line Magazine, I’ve realized some of the companies I’ve been leased to before have violated the federal truth-in-leasing regulations. Now that I’m looking for a new lease company, I’m trying to review the contract more carefully in order to avoid some of the bad experiences I’ve had in the past. 

I came up against a roadblock with one particular company when I asked the recruiter if I could take a copy of the lease home so I could have some time to review it before signing … or maybe even have an attorney or OOIDA look it over for me. He told me they don’t like to do this because there are a lot of companies trying to copy their lease agreement. Don’t they have to give me a copy of the lease? I thought the regulations state they have to provide me with one. Can you clear this up for me?

Answer: You’re probably thinking of the provision in the federal truth-in-leasing regulations that requires the motor carrier to provide the owner of the leased equipment with a copy of the lease. The exact wording is as follows: 49 CFR 376.12 (l) Copies of the lease. — An original and two copies of each lease shall be signed by the parties. The authorized carrier shall keep the original and shall place a copy of the lease on the equipment during the period of the lease unless a statement as provided for in § 376.11(c)(2) is carried on the equipment instead. The owner of the equipment shall keep the other copy of the lease. 

The problem you’re experiencing is simply that you haven’t yet signed the lease. While the regulations do not require the carrier to provide you with a sample contract so you can review it off site at your convenience, your desire to do so is good business sense. However, we’ve found many motor carrier recruiters are very protective of their leases. 

I think all kinds of red flags should go up when the recruiter refuses to allow you time to review a contract they are asking you to sign, and I’m not buying their excuse that other companies will try to copy it. If another carrier wanted to copy their lease, it really wouldn’t be that hard. Our members send us their leases for review on a regular basis. When a motor carrier exhibits such “over protectiveness” of their lease, it makes me think they have something to hide.

A lease agreement is a binding contract, and your request to know what you are agreeing to is definitely reasonable. As long as the contract is legal, you and the motor carrier will be required to abide by its terms. Since you can bet the motor carrier had the contract worded to protect (and advance) its interests, you’d better be ready to switch into your own self-preservation mode. If that means you need to take some extra time to review the contract, then don’t let anyone rush you. If the recruiter keeps shoving that pen in your hand before you’re satisfied you can live with the terms of the contract, start heading for the door.

Question: What is gap? Do I need to be concerned with it?

Answer: Well, since I don’t think you’re talking about the space between the buttons and the buttonholes on your shirt, or the name of the store where your teen-age daughter buys her clothes, my guess is you are referring to gap insurance. If you owe more for your truck than it is worth, you should be concerned with finding some insurance protection to avoid being stuck for the difference if you have an accident that totals your truck or trailer.

Because the bottom has dropped out from under the used equipment market, many owner-operators are finding themselves “upside down” on their loans. gap insurance provides protection for the owner-operator when there is a “gap” between the loan/lease payoff and the market value of the equipment in the event of a total loss. 

OOIDA’s gap coverage is offered to members in conjunction with physical damage insurance, and pays the loan/lease deficiency following settlement of total loss or constructive total loss claims as a result of collision damage only. Keep in mind conditions and exclusions apply, so have an agent go over policy terms with you to get any questions answered.

If you find yourself in a situation where you owe more on your equipment than the actual cash value, you should consider talking with your agent about gap coverage. Taking the time to do so could save your hard-earned dollars.

If you have questions you’d like answered, please e-mail them to Although we won’t be able to publish all questions in Land Line, you will receive a response.