This complete cornerstone article about RV financing contains three parts:
- First part: RV financing calculator. The first part is an RV financing calculator and a detailed explanation about how to use it.
- Second part: APR chart updated. The second part of this article, scrolling below, are all the ways to obtain financing for the purchase of your recreational vehicle through RV loans.
- Third part: What to consider and errors to avoid when financing your RV. Scrolling down below even further, are all the errors you can make while RV financing, and how to avoid them to save money. Most of these errors to avoid were described by us in the comment section of the blog, and also in our account on Facebook.
So let´s go first to the RV financing calculator right below and explain how to use it.
The RV financing calculator contains the following fields:
- RV Price: The price of the recreational vehicle, the face value.
- Down payment: The initial payment you are doing for the vehicle independent from the RV financing loan. For our readers in the European Union, this is called “deposit”.
- Loan amount: The loan you request to the financial institution. The amount will be similar to the RV loan quantities, minus the downpayment.
- Term: Length of the RV financing loan lifecycle, that can span too many years. The longest, the higher the interest will be.
- Interest: The market interest at an annual rate.
- Payment: Populated by our RV financing calculator analyzing your previous inputs in the other fields.
- Total paid: Self-explanatory, the quantity of the RV financing loan already paid.
The first step is that you have to introduce the first five values to acknowledge the estimated quantity of your forecasted payments on a monthly basis.
After this, you will retrieve the results for the estimated “Monthly Payment”. If you do not like this figure because it seems too high, you can adjust only this figure and the calculator will show the others change. Keep playing with these figures until you obtain adequate RV financing calculations.
Now, let´s see the APR Matrix below.
APR Matrix For RV Financing Estimation
Your target RV can be from a small teardrop trailer or a small camper without bathroom, to a large and luxurious class A RV from Monaco Coach. Therefore, you have to know first, the value of this asset.
Once you know the value of your target vehicle, you can deduct easily the APR with this APR matrix that serves you as an RV financing chart.
|APRs* are based on loan amount and length of loan (number of months)|
|Loan Amount||48 – 60||61 – 84||85 – 120||121 – 144||145 – 180||181 – 204||205 – 210||211 – 240|
|$10,000 – $14,999||6.24%||6.84%||7.24%||7.74%|
|$15,000 – $24,999||5.74%||6.14%||6.54%||6.94%|
|$25,000 – $49,999||5.64%||5.94%||6.04%||6.14%||6.24%|
|$50,000 – $74,999||4.74%||4.84%||4.94%||5.04%||5.14%||5.24%||5.24%||5.34%|
|$75,000 – $99,999||4.74%||4.84%||4.94%||5.04%||5.14%||5.24%||5.24%||5.34%|
|$100,000 – $149,999||4.74%||4.84%||4.94%||5.04%||5.14%||5.24%||5.24%||5.34%|
|$150,000 – $249,999||4.74%||4.84%||4.94%||5.04%||5.14%||5.24%||5.24%||5.34%|
|$250,000 – $349,999||4.74%||4.84%||4.94%||5.04%||5.14%||5.24%||5.24%||5.34%|
|$350,000 – $499,999||4.74%||4.84%||4.94%||5.04%||5.14%||5.24%||5.24%||5.34%|
|$500,000 – $1,999,999||4.74%||4.84%||4.94%||5.04%||5.14%||5.24%||5.24%||5.34%|
Avoiding Errors When Financing An RV
After you know where are you standing, thanks to the RV loans calculator and the aforementioned updated APR chart, you can check these errors and situations faced by our readers and mentioned in the comment section and in our social network on Facebook.
There are several factors to determine what kind of financing and interest rates you can get for a new or used RV.
Study updated current rates: RV loan rates mimic somewhat the rates for automobile loans. Therefore, if you notice a trend in the auto loans, you can expect a similar trend shadowed by the RV financing industry afterward
Dependency on the credit score: Ideal credit score for you will be 650. Anyway, you can gather an interesting and favorable RV loan contract even with a lower credit score. With lower credit score you have to pay more to the financial company because you represent a higher risk for them. Therefore you will pay more for your loan in these cases.
Down payment: If you can furnish an offer of a down payment for your loan, you will obtain better APR, better conditions and terms for repayments, lower monthly payments, so you will be less risky, and this improves a lost your bargaining power. Offering ten percent of the value of the asset to the RV financing institution as down payment will be a decisive advantage on your side.
RV financing through a dealer: This is the process I can recommend the most, as you do not have to come back and go forth al the time between the financial institution and the leader. The same dealer who is selling you the asset, what in our case is the recreational vehicle, will also, and in just one or two days arrange also the loan acting in representation of the lending company. He has a cut of the operation, but taken from the loan company and not from you.
RV financing through a bank: According to our readers, they found it less convenient, unless it is the bank institution that you have always used. In this case, they found it very convenient because they considered that your bank will be more lenient in case of default. The greatest disadvantage of RV financing through a banking institution is that it takes many days of discussions. The bank takes several days to scrutiny you and their internal approval process is a network of approvals and signatures whereas with a dealer it is concluded within two business days maximum.
As a short conclusion of what we explained, the best situation to request RV financing for your next financed purchase of a recreational vehicle will be:
- Your credit score: Credit score of 650
- Down payment: Possibility to furnish a down payment of about ten percent of the target asset.
- New RV models preferred: Model purchased should be new or not more than ten years old.
- Not full time RVer: You should not be living full time on a recreational vehicle.
- Preference for motorhomes: Preferably an RV with an embedded engine, such as class A, class B, and Class C RVs in detriment of fifth wheels, travel trailers, pop up campers, etcetera.
- Steady income: Regular income for the last triennial period: It is fine if you have switched jobs frequently, if the condition that your income has been stable, is met.
- Dealer or Bank?: Preferably this financing should be obtained with your dealer, instead than a bank. Unless that you are already working with this bank and you have a familiar relationship with them.