Mistakes to Avoid When Financing An RV

Not Having a Budget

Budgeting is a word no one likes to hear, but when buying a large purchase like an RV, it’s definitely something you need to consider. It’s fun to look at luxury Class A RVs, but if that type of unit isn’t in your budget then it’s time to move on to more realistic options. We encourage you to use online sites like RV Trader to research and compare the pricing of the types of units you’re interested in. Remember, it’s always important to buy within your means so you don’t regret your purchase down the road.

Failure to Consider Other Costs

When planning your overall budget, you’ll also need to account for other costs rather than just the RV itself. Additional costs associated with an RV can include fuel, taxes, insurance, maintenance, and more. You’ll want to create a spreadsheet with all of the expenses that your new RV could include and then add those to your other monthly expenditures like your mortgage payment, car payment, utilities, food, etc. After adding up all of these expenses, ask yourself if you can afford an RV loan on top of those recurring payments.

Forgetting About Your Credit Score

As with any loan, you’ll need to make sure your credit is in good standing and that you have enough credit history to qualify for an RV loan. You can request a free copy of your credit report from each of three major credit reporting agencies – Equifax®, Experian®, and TransUnion®. If your credit score needs some work, that could slow down the process of getting a loan. To build your credit score, you’ll need to make sure you’re paying your bills on time and that you’re working to eliminate any outstanding credit card debt.

Not Saving For a Downpayment

Once you see what a potential downpayment might look like for the unit you’re interested in, you’ll need to start saving. For some, this can take weeks, months, or even years depending on the amount required. For most of us, it’s unlikely that we will have those funds on hand at any given time so you’ll want to start planning well in advance. Keep in mind that the more you put down, the more likely you are to receive a lower interest rate.

Avoiding Talking to a Lender

Once you feel like you’re in a good place to consider buying an RV, you’ll want to reach out to a lender or have the dealership you’re working with reach out to various lenders – the option is up to you. Unless you’re paying cash, you’ll need to consult with a lender at some point in the buying process. There are various types of places to obtain a loan like credit unions, banks, RV dealerships, and online lenders. It’s okay to shop around to find the best rate and loan options for you and we encourage you to do so. Remember, lenders are here to help you and guide you through the buying process, so you can reach out to them at any stage of the financing process and lean on their expertise.

The initial financing process might seem daunting, but it really doesn’t have to be if you avoid these mistakes. Ready to start the buying process? Check out some of our most recent listings on RV Trader.