Can I mortgage a caravan?

In today’s blog post, we will answer the following question: Can I mortgage a caravan? We will discuss financing options for buying a caravan. We will also give you advice on making a good deal when asking for caravan enhancement. 

Can I mortgage a caravan?

No, you cannot mortgage a caravan, static caravan or park model home. The main reason why banks will refuse you is that a caravan is mobile and not a static site. You may get a partial mortgage only if you plan on buying the plot also – but this is not a guarantee and will always depend on the bank.

Are there any alternatives to finance a caravan?

The possible channels through which you can get to own a caravan are greater than those accessible in the case of buying a car, due to the large number of specialized rental shops, which is very popular for this category of vehicles.

Consequently, there is a large choice of contacts when deciding whether to buy a caravan:

  1. the private one; 
  2. the dealerships;
  3. specialised rental activities.

Therefore, even the purchase in installments, through the request for a loan for RVs (whether personal or finalized) does not encounter particular difficulties, except those of the applicant’s creditworthiness and income capacity, as is the case for any other type of loan (except for some very specific types).

To buy the caravan, is it better to finance it through a dealership or a DIY loan?

For the financial companies, which have agreements with the dealers, it does not matter that it is a caravan or a car, so you have access to offers with medium-low rates compared to those required by a possible personal loan.

Obviously, the situation changes if you decide to buy a caravan from a private individual, since in this case, most likely, the bank or the financial company will offer the possibility of applying for a personal loan, which has the advantage of not being tied to the purchase itself, but which on the other hand provides for the application of higher interest rates than those envisaged by the financial companies in the loans for the purchase.

There are rental businesses that carry out “own” loans. Still, these are forms of ‘deferred payments, for which there is, in any case, the application of interest, with conditions that must be carefully evaluated (often, this kind of offers, in fact, lack transparency and clarity).

Caravan loans: conditions for requesting one

To successfully apply for and obtain the caravan and caravan loan, it is essential to meet specific requirements when submitting the loan application. As for any other loan, the requisites required are to evaluate the subscriber’s ability to repay the disbursed capital based on a monthly instalment and an amortisation plan chosen at the subscription time. 

The subscriber of the caravan and caravan loans must:

  • be hired with a permanent employment contract;
  • be employed with a fixed-term employment contract (in this case, the duration of the repayment plan must be less than or equal to the duration of the contract itself);
  • not having been protested or placed on the list of bad payers.

To obtain the caravan and caravan loan, it is necessary to go to the branch of a credit institution to request the loan, and the necessary documentation required to get a loan are:

  • Valid identity document;
  • The tax code;
  • Proof of the last paycheck.

Can you buy a caravan on a credit card?

Yes, you can buy a caravan on a credit card. The trick is to find a dealer who agrees. You won’t be able to do this with all dealerships, and even then, it will probably depend on the cost of the caravan itself, among other things.

Here are a few tips if you want to buy a caravan on a credit card:

  • Ask the salesperson: You may be able to buy a caravan with a credit card, you may not. It all depends on the dealer’s policies. Contact the dealer directly for details, but consider calling anonymously ahead of time so the sales rep isn’t stubborn during negotiations.
  • Do your research: Research the average price of the caravan you plan to buy so that you are ready to negotiate once you are face to face with the dealer.
  • Negotiate first: Try not to reveal your payment method until you’ve closed a deal that meets your needs, or else the seller may refuse to pay the processing fees involved in accepting a credit card.
  • Avoid paying interest: Use a credit card with a long 0% APR purchase period to pay for the caravan without incurring interest charges.
  • Get Big Rewards: If possible, consider a rewards credit card and a great sign-up bonus. A caravan is usually a large purchase that can earn you a large amount of cash or reward points.

How to finance a caravan with a credit card?

Although experts say that financing the purchase of a caravan through a credit card is expensive, with some actions you could reduce some costs at the time of purchase of the vehicle. How? Here we tell you:

Buying a caravan with a credit card can be financed with a debt purchase and end up paying interest of up to 10%. For example, if the cost of the caravan is $16,500, and you have an amount of $1000 that you will give as an initial to the seller; The rest could be paid with the card at about 24 instalments, with an annual rate of 40%.

In the 2nd month, you can request the purchase of debt, the idea is to inquire about the best rates, an ideal would be, as we mentioned at the beginning, of 10%. You must contact an executive of said entity to start managing your transfer and voila, you would be paying lower fees calculated with a much lower rate than your original card and saving all the expenses involved in a vehicle loan.

Although this story can have a happy ending, you should always consider having the debt transfer pre-approved before making this purchase, lest you stay with a purchase of such magnitude on the credit card, that in the end, the search savings become a huge headache.

If you have an interest-free credit card or a card with a 0% interest rate, (which gives you a period of time to pay for a purchase without accruing interest) it may be a good idea, but if you are sure that you can pay all caravan debt during the zero interest time period. However, it is a risky proposition.

Final thoughts

According to financing specialists, opting for a vehicle loan to acquire a caravan is the alternative that will bring you benefits in the long term. Here we explain why:

  • If you have more products in the bank, you get a lower rate.
  • Vehicle insurance is included.
  • The initial fee is manageable.

Since mortgaging a caravan is not possible, we suggest you consider the credit card alternative presented in this article.

If you want to know more, or if you want to share your own experience with financing a caravan, we’d love to hear from you!

FAQ on Can I mortgage a caravan?

What to know before buying a caravan?

Before buying a caravan, the first thing to consider is to verify that you have a suitable towing vehicle to travel safely, then have an expert check what maximum mass you can tow, after which you can start your research.

How much does a small caravan cost?

The prices of a small caravan do not generally exceed 10 thousand dollars. In comparison, for small used caravans in good condition, the price range goes from a minimum of 1,500 dollars to a maximum of about 10 thousand dollars.

How much do you end up paying for a caravan on credit?

The average caravan loan interest rate remains at 13%, which represents an opportunity to own your own caravan, experts say.

What questions to ask before buying a caravan?

Before buying a used caravan, ask the following questions:

– How many kilometres/miles does it have? 

– Why is the vehicle for sale? 

– How much are you asking for the caravan?

– What are you willing to give up to sell the caravan?

– Where did you buy the vehicle?

– Do you have the invoice in hand? Etc.


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