Purchasing an RV is like purchasing a home to some people. Whether you’ll be living in it full-time or if it is your home away from home, chances are you will need an RV loan to finance it. Here are three things you should know about RV loans.
A Good Credit Score Is Important
Just like it is with auto loans, a good credit score is very beneficial when applying for an RV loan. Rates for RV loans are sometimes higher than rates for car loans, which is why you credit score is so important. You definitely want to get the lowest rate possible. If your credit score is bad, work on improving it before purchasing your RV. Should there be any errors in your credit report, dispute them immediately as these errors could be the reason for your bad score.
A Down Payment Is Helpful
Keep in mind that RVs depreciate in value rather quickly. Without a down payment, you could be upside-down on your loan without even realizing it. Always put some money down if you are able to. A down payment can also get you a better interest rate and will also bring down your monthly payment and reduce the length of the loan.
An RV Loan Is Harder to Get
Not everyone who purchases an RV is a full-time RVer without a mortgage payment. Most people already have a mortgage and probably even one or two auto loans when applying for an RV loan. Based on this, lenders are often more critical and need proof that you’re able to afford an additional loan. Make sure you know exactly how much RV you can afford so you can plan accordingly. The dealership where you’re purchasing your RV can help you shop the market for the best interest rate that fits your budget.
Preparation is essential when making a major purchase. As exciting as getting an RV is, you want to be knowledgeable before going shopping. With these three facts in mind, you are better prepared.