Financing a brand new HDT

[Heavymetal]

I read up on the forum before looking for our new truck and even know we have great credit and am putting 50% down I was worried about finding the financing, It was not an easy task to accomplish.

No regular RV financing source would touch it since it was a commercial truck and our credit union (of 32 years) said no and I was just about to give up. I think this comes from not having small town backs any longer and a banker that you know and can talk to face to face also the crash of 2008 made it even more difficult.

We did prevail in the long run and was able to finance the balance through Diamler/Freightliner using our Montana LLC all we had to do was get a EIN. The only problem we ran into was not having a CDL and after convincing them that we were not over the road truckers just RVers it went right through. So in the end we saved the 12%FET and the 7.25% for Texas motor vehicle tax.

[GlennWest]

Our cc was reluctant to begin with and then suggested they finance later. Go figure.

[rickeieio]

using our Montana LLC all we had to do was get a EIN.

 

Might this make it difficult to convince the DOT officer that you are not commercial? Oh, the tangled web we weave.

[Heavymetal]

using our Montana LLC all we had to do was get a EIN.

 

Might this make it difficult to convince the DOT officer that you are not commercial? Oh, the tangled web we weave.

I doubt it because both the registration and insurance show as a RV.

[Alie&Jim's Carrilite]

Have a question about that, Can you buy the truck in the LLC name, but actually register the truck in your own name? Kinda like your retirement gift from the LLC was your new truck?

[Big5er]

I doubt it because both the registration and insurance show as a RV.

The fact that it is "registered" as an RV does not mean you are not commercial.

 

The fact that it is owned by a "company" (LLC) implies that it is commercial. The fact that companies do not, out of the goodness of their heart, supply employees and corporate officers with an RV to drive around in, suggests that there is some sort of "perk". Whether that "perk" is for the employee (free use of the company RV in lieu of other compensation) or for the company, there is still a "benefit" (tax deferment?) involved.

A moped, in the right circumstances can become a "commercial motor vehicle" and subject to the federal regulations. An HDT is already a CMV by definition but may qualify for an exemption to the federal regulations.

 

This topic has been discussed here many times and I, for one, would consider a company owned RV falling into the category of "corporate sponsorship" which means that your RV would be subject to all of the federal regulations, including a DOT number, CDL, log book, medical certificate.

[Heavymetal]

Have a question about that, Can you buy the truck in the LLC name, but actually register the truck in your own name? Kinda like your retirement gift from the LLC was your new truck?

I guess we will find out. I'll keep you posted if I get pulled over before I can refinance through good SAMs Bank of the West which have better interest rates but would not finance the truck from the dealer.

[Larry&Donna-AK]

The fact that it is "registered" as an RV does not mean you are not commercial.

 

The fact that it is owned by a "company" (LLC) implies that it is commercial. The fact that companies do not, out of the goodness of their heart, supply employees and corporate officers with an RV to drive around in, suggests that there is some sort of "perk". Whether that "perk" is for the employee (free use of the company RV in lieu of other compensation) or for the company, there is still a "benefit" (tax deferment?) involved.

A moped, in the right circumstances can become a "commercial motor vehicle" and subject to the federal regulations. An HDT is already a CMV by definition but may qualify for an exemption to the federal regulations.

 

This topic has been discussed here many times and I, for one, would consider a company owned RV falling into the category of "corporate sponsorship" which means that your RV would be subject to all of the federal regulations, including a DOT number, CDL, log book, medical certificate.

Thanks Big5er, that is also my point of view. I bought my Volvo, New, as a recreational vehicle and wasn't required to pay the 12% FET (legally) for that very reason, Recreational Use. Also, You enlightened me about the "Not for Hire" and how it doesn't mean Not Commerical. If ever I put any words on my paint it will say "Recreational Vehicle Use Only".

[rickeieio]

Yes, you can register in a name other than who wrote the check. I do that on my pick-up for a rather trivial reason......I can't get a vanity plate on a farm tag. That said, as far as the IRS is concerned, I jump through all the hoops, and I'm actually paying more to the DMV than I would with the farm tags.

 

Disclaimer: no finance company involved.

[Shifted]

It's the use that matters. Ownership may imply certain uses, but it doesn't prove or disprove them. Is the LLC involved in any interstate commerce? Is the vehicle ever involved in or used for interstate commerce? If the answers to both questions is "no", then it is definitely not subject to the interstate commerce laws that govern the regulation of commercial motor vehicles. If the answers are "sometimes", then it entirely depends on the actual current use of the vehicle.

 

Individual states may have differing laws, but usually those differences apply to the driver's licensing but otherwise are in line with federal laws about the vehicles.

 

I won't quote the entirety of the federal code, but this is a link to some official questions and answers that are relevant to the section of law that we are discussing. Within the first couple of paragraphs of the below link is a link to the actual federal code:

 

https://www.fmcsa.dot.gov/regulations/title49/section/390.3

 

In summary, the Federal Motor Carrier Safety Regulations (FMCSRs) apply to people or entitites who are operating a "Commercial Motor Vehicle" while engaged in "interstate commerce". Those are specific terms defined by the law, not by the dictionary.

 

The definition of "Commercial Motor Vehicle" is discussed in this link, with another link in the first part of it to the actual federal code:

 

https://www.fmcsa.dot.gov/regulations/title49/section/390.5

 

It defines a "Commercial Motor Vehicle" as being either over a certain weight, or carrying over a certain number of people, or carrying "hazardous" material. But in ALL cases, it must ALSO be engaged in "Interstate Commerce" in order to be considered a "Commercial Motor Vehicle" from the perspective of the Federal government.

 

 

"Interstate Commerce" is, in general, defined by moving between states AND being involved in "commerce" (exchange services or goods for other services or goods, including money). Whether it's trade, traffic or transportation. There must be an exchange involved, not just "transportation". You would have to transport something for some kind of remuneration, even if it is indirect, like free delivery of items that a customer buys from you.

 

 

But here is the kicker for those who think that a Montana LLC owned Class 8 truck is automatically engaged in "Interstate Commerce":

 

 

Question 5: A driver used by a motor carrier operates a CMV to and from his/her residence out of State. Is this considered interstate commerce?

Guidance: If the driver is operating a CMV at the direction of the motor carrier, it is considered interstate commerce and is subject to the FMCSRs. If the motor carrier is allowing the driver to use the vehicle for private personal transportation, such transportation is not subject to the FMCSRs.

So, not only does the law clearly not apply to Class 8 trucks used for private and personal purposes regardless of who owns it, but the Federal authority on the matter has even gone so far as to post a question and answer on that very subject.

 

Remember, the United States law system is a "permissive" legal system. Which means that everything is allowed unless explicitly disallowed. So unless there is a law that states that no truck over a certain size may be owned by an LLC unless it complies with FMCSRs...it is allowed. The federal code explicitly disallows the operation of trucks of a certain weight rating or with certain cargo types/sizes that are involved in interstate commerce unless they comply with the FMCSRs. Regardless of who owns it. But both of those conditions must be met for the law to apply.

 

 

A law enforcement officer who is authorized to enforce FMCSRs, whether they are a local, state or federal LEO, can and will make their own interpretations on the spot. But that doesn't mean that they are correct. If a LEO treated a truck that is not engaged in interstate commerce as though it were, when it gets to court the owner/operator of the vehicle in question will prevail. It's not only straight forward in the law, but an interpretation of the law that represents the position of the Federal government is publicly and clearly stated.

 

 

Be prepared for the LEO that doesn't understand the law and treats you like you are in violation of the FMCSRs. It may happen to someone at some point. And it might interrupt your trip for a while until either their supervisor gets involved, a call to the federal regulatory authority is made, or, worst case, you have to take it to court. But sooner or later you will prevail if you are not engaged in interstate commerce.

 

Which is why you should never accept gas money, help working around the house, free parts, sponsorship, or anything in any shape or form in compensation for towing, advertising, hauling or transporting something for someone with your Class 8 truck. Don't even pick up some oil from a local store for a friend (and accept repayment) or sell your custom widget kit at a rally if you transport it with your Class 8 truck. Give it to them for free, no problem. Accept remuneration, and you are now engaged in interstate commerce. You are only one qualification away from falling under the FMCSRs. Don't take chances with the use of the truck so that there will be no question as to your compliance.

[13speed]

Great post Shifted!!! Just because the truck is registered to a LLC or a "company" it does not automatically mean that said company is engaged in interstate commerce with the vehicle.

[GeorgiaHybrid]

The truck can also be owned by a LLC and leased to an individual just like a car.

[Heavymetal]

Shifted,

That truly clarifies much of this discussion, thanks for your input.

[billr]

If it were true that an LLC owned unit is automatically a comercial vehicle what about all those rigs out there pickups and fivers, Class A MHs and even thier toads with MT tags.

 

I agree with Shifted post. Very clear.

[Vegas Teacher]

Because of everything you are talking about is why I have been saving for the last 3 years and this summer will make 4. I have an investor I use for everything and part of my savings is tied in the stock market. I hope Trump takes care of us because this summer I could have anywhere from 20K to 44K depending on the stock market. At the beginning of this month I had 26K and some change and I invest 1200.00 each month. I just hope the market is back and going strong and Trump delivers on his promises.

 

Later,

 

Cory O

[Big5er]

Shifted, as many people do, you selected the sections that you wanted to be applied to you and used them. You are absolutely correct that a CMV is defined (in our case) as a vehicle or combination of vehicles with a gross vehicle weight rating in excess of 10,001 lbs. Ok, so we ARE CMV's by definition. Then you supplied your own definition of "commerce". That isn't how it works. If you will read 390.5 you will find the definitions of both "inter" and "intra" state commerce. Without wasting time on the differences between the two, neither one requires any exchange of "goods and services" as you want to claim. The definition of commerce according to the FMCSA regulations is simply "any trade, traffic, or transportation". That is it. Trade, traffic or transportation. You are reading into the definition when you claim that there must be an "exchange" involved. Every vehicle on the roadway is involved in trade, traffic or transportation, and that is the definition of commerce. The only difference between inter and intra state is where it happens. And only the ones meeting the definition of CMV are subject to the FMCSA regs unless they meet one of the exceptions. You are trying to bend the definition to what you want it to be.

So now we get to the exemption allowed for RV's. Again, you chose to use only the part of the regulations that fit your side of the conversation. First, the guidance that you referred to addresses a vehicle and driver doing things at the "direction of a motor carrier". You might want to read 390.3 which covers "Applicability" of the FMCSA regs to CMV's. You will find that the FMCSA regs apply to all CMV's (remember we are CMV's) and lists the exceptions. One of those exceptions is 390.3(f)(3) which is "The occasional transportation of personal property by individuals not for compensation nor in the furtherance of a commercial enterprise". That is all well and good, until you read guidance question 21.

Question 21 asks:

Does the exemption in §390.3(f)(3) for the "occasional transportation of personal property by individuals not for compensation nor in the furtherance of a commercial enterprise" apply to persons who occasionally use CMVs to transport cars, boats, horses, etc., to races, tournaments, shows or similar events, even if prize money is offered at these events?

Guidance: The exemption would apply to this kind of transportation, provided: (1) The underlying activities are not undertaken for profit, i.e., (a) prize money is declared as ordinary income for tax purposes, and ( the cost of the underlying activities is not deducted as a business expense for tax purposes; and, where relevant; (2) corporate sponsorship is not involved.

This leads us right back to the vehicle being owned by a LLC or company/corporation.

There are other sections that refer CMV's used strictly for "recreational or non-business purposes". Is a company truck recreational? Ask Jeff (user name "beyerjf"). He drags his RV trailer with his commercial work truck....and follows all the regs as if he were towing a customers trailer when he does. Why? To avoid any pitfall of trying to do otherwise.

I personally do not care how you register your truck. As you can see by my retirement counter I retire in roughly 3 months. I have no desire to get into a pissing match with you but if you had been here longer than 8 posts you would know that enforcement of the FMCSA regs is what I do for a living and I have for roughly 10 years. I can debate the regs with you all day long. What line of work were/are you in?

It is a fact, your HDT is a commercial motor vehicle, by definition and what it is. If it is on the road, it is engaged in trade, traffic or transportation, in either interstate or intrastate commerce. The ONLY question is does your HDT qualify for the exemptions that are allowed by law. I see trucks pushing that limit every day. I catch trucks pushing that limit every day. If you want to push that limit, help yourself. I would like to ask that before you give bad advice you study the regs a bit more. There are many people who do not want to push the envelope who desire and deserve good answers.

You said "Don't take chances with the use of the truck so that there will be no question as to your compliance."........isn't that what you are doing driving a company owned truck?

[Big5er]

If it were true that an LLC owned unit is automatically a comercial vehicle what about all those rigs out there pickups and fivers, Class A MHs and even thier toads with MT tags.

 

I agree with Shifted post. Very clear.

Bill, no one said that being owned by an LLC automatically made a vehicle a CMV. The definitions in the federal regs is what makes it a CMV. Being owned by an LLC is what may cause it to lose the exemptions given to RV's though. And while most enforcement officers stay away from RV's, I work in an area where racers claiming to be "RV'ers" are rampant. I also know (as do others here) of an enforcement officer locally that has no issue with stopping and citing RV's.

I believe that as our little group grows, so will the enforcement effort...but that is just my opinion.

[Norm & Rhonda]

Wow this is getting very heavy. As a long time commercial driver I do know that there was one statement that I do agree with. It was the talk about interpretation of the law. that was why I traded up from a 2500 GMC to a 3500 Ram. I didn't want to be caught out somewhere and have an officer tell me that my 2500 was not rated to be towing my 18,000 lb 5er and that I needed a tow truck to tow it out of the state. The same reason I when thought the extra pain and expense to have my class 8 truck re VINed, titled and registered as a "special Construction Recreational Vehicle. If the new VIN is ever run it will never come up as a semi truck. But all of that is still interpretation of the law.

 

Big5er... Mister DOT Officer Sir! I would love to get your opinion on what I have done. I know as far as value I may have depreciated the value of my truck but I didn't do it with resale in mind. I did it to try to alleviate as much hassle as I could so that my DW and I could travel as peacefully as possible. Here in my present State of residence Missouri the state troopers are the ones that helped me through all the red tape to accomplish this. But I plan to use another state as my domicile in the near future. Right now I am thinking of Texas.

 

Thank You

I look forward to hearing about your opinion

[Shifted]

You're really reaching on this one. Not sure why you insist on your position or on stating that I am like "most people" and implying that "most people" don't know what they're talking about, but that's rude, inaccurate, and your position is not legally defensible. The links that I've provided make it clear, with easy to understand Q&A's from the federal government in case there is confusion on how to read a code that is written within a permissive legal system.

 

To answer your personal attack, I have been following this board for longer than you've been on it and am well aware of your posts and positions and your job and knowledge and experience. You can't say the same about me.

 

It seems like you've chosen your hill to die on with this issue as I've seen you post your position on LLC owned Class 8 trucks repeatedly. Sometimes it's worth reassessing a position with an open mind and seeing if maybe you've picked the wrong hill to make a stand on.

 

This is the last that I will comment on this topic or thread. I sincerely hope that people are not thrown off track by your position and that they get their own experienced and qualified legal counsel on the matter so that they can make an informed decision.

[Big5er]

Wow, It seems I hit a nerve. I was just stating facts. Like many others, you used half questions, coupled with half answers to achieve the result that you desired.

To answer your personal attack, I have been following this board for longer than you've been on it and am well aware of your posts and positions and your job and knowledge and experience. You can't say the same about me.

I seriously doubt that you have been here longer than I have but since you have only made 9 posts, I guess we will never know. And as far as what I can or can't say about you, since you chose to hide and avoid answering again, we will never know that either.

"Not legally defensible"...now that was funny

Sorry you got your feathers ruffled. Try a Dr. Pepper, maybe it will calm you down some.

And the door swings both ways on your last sentence. At least I am capable of putting my experience out there when I answer a question. All you have done is "claim" to be a lurker on the forum.

[Heavymetal]

I think it is amazing that no matter what the topic someone post on this and any other forum we always seem to have someone that knows everything about everything. If there was only one way to interpret, in the case the law, we would not need lawyers are the courts and by slinging insults or personal attacks we lose the knowledge of other members. Some people and usually the smartest and most knowledgable don't care are find it necessary to get into a pissing match with those that think because of their position or job their thoughts or interpretations are always correct.

 

So Big5er center mass or head! Which one is correct? Truly I want to know your opinion since yours is the only correct one. the next time I find myself in a combat zone I want to make sure I draw the correct sight picture before I squeeze off a round.

 

Heavymetal, US Army Infantry 1985-2009 (retired)

[Big5er]

You may be a better shot than me, but I think center mass is easier. I'm not an expert but I have been carrying and shooting a pistol for 33 years. That doesn't mean center mass is the best but it is certainly better than being told by the uninformed to just point and shoot, eh?

There are plenty of ways to interpret anything which is why there are courts and judges. I see this same issue frequently (as in the earlier post) is people ask half a question, hoping for an answer they like.

"Do I need a special license to drive my truck pulling my travel trailer?" No, so off they go, when the whole question should have been "Do I need a special license to drive my 52,000lb gvwr truck and pull my 18,000lb trailer?" Different answer.

Or my personal favorite "Do I need a DOT number to drive my HDT RV and pull a little car hauler trailer?" No and again the whole question should have been "Do I need a DOT number to drive my HDT RV and pull my car hauler trailer, with my race car, around the country to compete in PDRA competitions?"

The previous poster gave a partial and incorrect definition of commerce, demonstrating his lack of...familiarity with the laws he was trying to quote. He also tried to claim that somewhere I said an LLC owned RV was "automatically" commercial. I plainly stated that an LLC could be implied as being commercial. Either he misread my post, as he did the law, or he was intentionally misquoting my posts and the law. I don't know, or care which. I simply tried to correct his misinformation and he felt all "personally attacked". Kinda makes you wonder, doesn't it.

[Heavymetal]

This post was about how I went about finding financing for our HDT and what I had to do to get around the problems I as many others have incountered along the way. Yours and shifters post both are right and wrong but I am not a lawyer so therefore I avoid giving my interpretation of the law. The Supreme Court though has a much different take on what is private verses what is commercial and they have ruled on it many times. The problem is "We The People" let not only the states but also our federal government pass laws that are unconstitutional and by not standing up for what is our rights under our constitution we give our rights away. That being said the Supreme Court has upheld the rights of the people to move along the interstate and intrastate unencumbered by those that try and do in most cases impede us under laws passed by states and the federal government that are clearly unconstitutional. The following is just the first paragraph from one of the Supreme Courts ruling on the Carriage law which governs the movement of not only people but what constitutes commercial commerce and then a little from a ruling in 1979.

 

The right of a citizen to travel upon the public highways and to transport his property thereon, by horsedrawn carriage, wagon, or automobile, is not a mere privilege which may be permitted or prohibited at will, but a common right which he has under his right to life, liberty and the pursuit of happiness. Under this constitutional guaranty one may, therefore, under normal conditions, travel at his inclination along the public highways or in public places, and while conducting himself in an orderly and decent manner, neither interfering with nor disturbing another's rights, he will be protected, not only in his person, but in his safe conduct."

 

Thompson v.Smith, 154 SE 579, 11 American Jurisprudence, Constitutional Law, section 329, page 1135 "The right of the Citizen to travel upon the public highways and to transport his property thereon, in the ordinary course of life and business, is a common right which he has under the right to enjoy life and liberty, to acquire and possess property, and to pursue happiness and safety. It includes the right, in so doing, to use the ordinary and usual conveyances of the day, and under the existing modes of travel, includes the right to drive a horse drawn carriage or wagon thereon or to operate an automobile thereon, for the usual and ordinary purpose of life and business."

 

Thompson vs. Smith, supra.; Teche Lines vs. Danforth, Miss., 12 S.2d 784 " the right of the citizen to drive on a public street with freedom from police interference is a fundamental constitutional right" -White, 97 Cal.App.3d.141, 158 Cal.Rptr. 562, 566-67 (1979) citizens have a right to drive upon the public streets of the District of Columbia or any other city absent a constitutionally sound reason for limiting their access.

 

Unless in a close ambush I prefer the head I've seen to many keep fighting when hit center mass. I truly prefer a 2000 lb JDAM dropped from above.

[Pete Kildow]

Care to fill the rest of us in on how you got away without paying the 12%FET and State tax? As I was told it did not matter if it was for private us. I still has to pay the FET. Same as I paid on the last tires I bought for my truck. Did not matter that I was buying them for a private (In my case giant Pickup) I still paid the FET. Same as i have to pay on every sale we may of our product line.

Not saying you did anything wrong. Always like learning something new. But the only way I have found to beat the FET on a new class 8 truck. Buy a Glider and if I were buying new. It would for sure be a Glider kit.

Pete

[Alie&Jim's Carrilite]

As someone that has sat on the side of a highway recently, I-94 Fargo ND, we, my wife and I, had to educate the North Dakota Highway patrol officer that stopped us for a totally different reason (window tint) on how we were licensed, why we didn't have CDL's, and why the "Looks like a truck, Sounds like a truck, But it's not a truck" truck. The officer was professional and polite, but all he knew where his state laws, and not all of them. He knew his interpretation as he understood his state statutes, but was reluctant at best to be told he was wrong in understanding what his state actually allowed by state reciprocity agreements. After he took our offered book of information and went to his cruiser for 15-20 minutes while he researched our info. He admitted that he learned something new that day.

Since this happened back at labor day, I have seen at least 15-20 mid to heavy trucks, FL60's, Dually's with signage, HotShotters, a few HDTs with horse trailers, all on the side of the road talking with the highway patrol here. And I can guess what about. Not being properly licensed for the vehicle being operated.

Having a Texas Commercial Vehicle Law enforcement Officer on this site, giving us the ability to understand how the state interprets its laws, how and why the officers react they way they do to us has been priceless for many of us.