Summer is here and that means road trips.
Before you hit the open road or set out on a camping adventure, you may want a recreational vehicle. And before you can even set foot in your own RV, odds are you’ll need financing.
Can you just walk into your local credit union and get an RV loan? What is the process? We will tell you everything you need to know.
How it works
The simple answer on getting RV financing? Yes, you can.
Borrowing to buy an RV is similar to using a loan to buy a car. Lending standards are more stringent than for auto loans, however. Your credit score will be an important factor in determining whether you get approved and at what rate. As such, it’s smart to shop for your financing before choosing your dream camper.
Do your research
Before you decide whether an RV is right for you, research what your monthly payment would be and see whether it’s feasible for your income. There are many useful online loan payment calculators.
Simply enter the estimated loan amount, interest rate and the amount of time you’d have to pay it off, or the term, and the calculator will do the rest. A RV loan’s annual percentage rate will vary depending on the size and duration of the loan, among other factors. As with cars, you’ll pay a higher interest rate to finance an older RV than a newer one.
After you’ve run the numbers and know what you can afford, you’re ready to approach the credit union for a loan.
Know the details
You’re probably familiar with financing a car, or even a home, but you may not be aware of some options applicable to RV loans.
Select RVs may qualify for federal tax breaks based on the loan interest you pay, similar to how the IRS treats mortgages on second homes.
- RV loans can have terms of up to 10 years, making the monthly payment much more affordable and reasonable.
- The credit union can also refinance debt on campers, which may help reduce your monthly payment.
- If you discuss interest rates and financing options with your credit union before approaching a dealer and pre-qualify for a loan, the sales chief may be willing to negotiate a better deal.
If you decide that a recreational vehicle is the perfect match for your lifestyle, let the credit union help get you moving and make your summer road trip a reality.