How to Finance Your RV
When a potential RV owner finds a camper that seems to be everything they are looking for and has all the features they could want, it’s hard for them not to get excited. Unfortunately, this enthusiasm is often doused when they see the sticker price. The dream of owning your own camper can seem forever out of reach, but there are always other paths forward. Many RV buyers, over 70% in fact, make their purchase using financing, and it’s not hard to see why. With financing, you don’t have to settle for less when you purchase or save up for years upon years to get what you want.
1. Build a Budget
Before anything else, it is important that you determine your budget. Knowing exactly how much you can afford to invest in an RV accomplishes two things. First, it will help ground your search, preventing you from “dreaming too big” and being tempted by a model beyond your price range. Second, you won’t be forced to play it too safe and skip out on features or models that might appear too luxurious but are within your maximum. In essence, knowing what you can afford will allow you to get the highest quality RV possible while not going over budget.
2. Save up for a Down Payment
If you choose to finance, it is best to start saving up for the down payment as soon as possible. Most financing options require an upfront down payment of between 10% to 20% of the RV's total cost. On the plus side, paying more upfront will allow you to get a lower interest rate and save you money in the long run.
3. Check Your Credit
One factor that many do not initially consider when they are applying for RV financing is their credit score. A higher credit score tells lenders that you are less likely to default on your loan, making them less reluctant to give you a loan and may even result in better terms. If you are unsure of how to start building your credit score, there are various resources online that can help you. If possible, try to shoot for a score above 700.
4. Consider the Types of RV Loans
You should know the different types of RV loans and what their terms are before you begin to pursue one. With a secured RV loan, the RV you purchase is used as collateral and may be repossessed if you default on the loan. On the upside, these loans usually have lower interest rates and higher borrowing rates. In the case of an unsecured loan, your RV is not at risk of being repossessed but the interest rates are usually higher.
5. Consider the RV's Long-Term Value
If you choose to take out an RV loan, you’ll be paying interest fees. With this in mind, be careful when choosing your RV so that you don’t find yourself paying more than the model is worth. An RV’s value depreciates over time, with the rate being highest for the first few years after the purchase. Though you may be tempted to buy the newest and most expensive model, if your loan terms are very long, you could end up paying more than the RV is worth due to interest over time.
If you’re ready to check out our selection of RVs for sale, stop by JR Motors in Lake Havasu City and Parker, AZ. Our expert staff is here to help you find your dream RV and walk you through the financing process. We are proud to serve all those in Blythe.