If you are thinking of buying and financing a Camper, you may wonder what Camper loans will be like. Used to the car financing, it may seem that these loans are similar, but they have very important differences.
One of them is the length of time you can get a loan for a Camper.
What is a Camper Loan?
The first thing to understand is the importance of recreational vehicles in the United States to understand what a Camper Loan is.
The number of RVs on the road in the United States is well into the tens of millions. We are talking about a significant volume ranging from small RVs to motorhomes to luxury coach homes.
There is a market for financing this type of vehicle. That is to say since it is such a large fleet, specific loans to buy campers exist and have particular characteristics.
How does financing an RV differ from other loans?
There are some relevant factors you should consider if you are considering buying a Camper and financing it with a loan.
The first one is that, in some cases, depending on the amount of the vehicle, it is enough to be able to resort to both conventional personal loans and specific loans or financing for these vehicles.
Usually, when the amount is low/medium, the difference with a conventional loan is small. The average duration is around five years, and the interest rates can be similar.
The only advantage of financing these low / medium-priced vehicles may lie in eliminating bureaucratic procedures when the financing is done through the sellers themselves. However, always check the cost carefully.
The main difference between a loan for a camper or a car is mid/high-end recreational vehicles.
In these cases, the loans may look more like a mix of conventional and mortgage loans. Generally, the loan will have a longer term, and the interest rates may be somewhat lower due to the longer repayment terms.
In fact, we can find loans for this type of vehicle in the market for up to 20 years. Logically, this is a type of financing oriented to two factors:
- That the vehicle has a certain market cost: you will not be able to obtain one of these loans for low-cost vehicles.
- That your credit score is adequate: with a bad credit history, it is very difficult to obtain a good loan to purchase one of these vehicles.
Factors to Consider Before Applying for a Camper Loan
There are some factors you should consider before applying for an RV loan.
The first of these factors, logically, is the price of the vehicle. Vehicle costs can vary greatly depending on the seller. Financing is always easier on a new car than on a used vehicle, where depreciation is a determining factor.
The second factor is the amount of money you can contribute from your pocket. Financing, whatever type it is, will have some added costs. For many people, it is in their best interest to contribute funds out of their pocket to reduce the loan cost in the long run.
Another key factor is your credit history. Keep in mind that with a bad credit history, two things will happen: first, you will have a harder time finding the right loan, and second, the loan will probably be more expensive.
Finally, it is also very important that you choose your lender carefully. Keep in mind that this is a large sector with many offers and that you can use different financing tools.
Therefore, it would be necessary to make a good comparison of loans, considering both the dealers’ financing and the loans of your usual lender and other specific market loans. All this until you find the loan that best suits the purchase of your Camper but also your pocket.