How to finance an RV over 10 years old?
In this blog post, we will answer the question: “How to finance an RV over 10 years old?” We will discuss the possibilities of financing an RV over 10 years old. We will also touch up on the credit score and other important factors. Furthermore, we will discuss the average interest rate for RVs over 10 years.
How to finance an RV over 10 years old?
To finance an RV over 10 years old, you need to follow the steps described below.
- Set aside a budget
- Save a down payment
- Check your credit score
- Find RV-specific lenders
- Check with credit unions
- Consider personal loans
- Check for collateral or home equity loans
Set aside a budget
- The first and most basic thing is to set aside a budget for financing an RV over 10 years old. RV financing for older models can be challenging with high-interest rates. Be sure to have a budget to help ease the overall process.
- Setting aside a budget is important as it lets you decide on the type of RV loan. Set a goal with a desired amount to help you reach the target. Determining the amount you have in each budget will help overall.
Save a down payment
- Saving for a down payment is sure to make things easy. The more you use for a down payment, the easier it becomes for financing. Most RV dealers require a minimum down payment of 10 percent of the purchase price. An RV over 10 years old might have a reasonable down payment that is not too expensive.
- In some cases, RV dealers would require a 20 percent down payment from the overall RV price. Start by saving money for a down payment. A bigger down payment reduces the interest rate and cost of the RV loan.
Check your credit score
- The crucial part of financing an RV over 10 years is having a good credit score. This is an important step since a strong credit score will help in easy financing. It is recommended to check your credit score before applying for RV financing.
- Most banks can provide your credit score. Knowing your credit score will help you determine your position. There are also various resources like Credit Karma or Annual Credit Report to determine your credit score.
- A decent credit score should be 660 or above. This is essential for most lenders to provide an RV loan without any hassle. The credit score impacts an RV loan. Hence, ensure you are creditworthy to get a loan for your RV.
- The credit score also depends on each bank. Some banks require a credit score that is more than 660. Be sure to build up your credit score before applying for a loan. Paying bills on time will enhance and improve the overall credit score. A credit score below 650 will be challenging to finance an RV over 10 years old.
Find RV-specific lenders
- The next step is to find RV-specific lenders. RV dealers usually handle this process since they direct their customers to lenders. Most RV dealers are already partnered with various lenders. In some cases, RV dealers provide in-house financing options.
- If you cannot find a lender through RV dealers, plenty of private RV-specific lenders are available. Most customers opt for a pre-approved loan by filling in an application. You can also find some of the best lenders online. Most lenders specializing in RV financing have lenient criteria for RVs over 10 years old.
Check with credit unions
- The next step is to check with credit unions. There are plenty of credit unions that provide loans for RVs. These unions are also well-known for their flexible policies. Credit unions also provide loans on RVs with lower interest rates and fees.
- Certain RV-specific lenders might not be suitable for loans on RVs over 10 years. In that case, credit unions are one of the best options. One easy way is to check with a local credit union. These unions are not cooperatives instead of corporations. Hence, they are more flexible in financing an RV over 10 years old.
Consider personal loans
- A personal loan can be an easy way out, but opting for an RV-specific loan is recommended. However, some people financed their RVs with personal loans. Some banks might not finance an RV over 10 years old, but a personal loan is left up to you and what you decide on doing with the money.
- Remember that personal loans are unsecured and do not require any collateral. One of the important criteria for a personal loan is having a good credit score. Hundreds of motorhome enthusiasts purchase RVs, campers, and fifth wheels, with the help of a personal loan.
- There are a few drawbacks when it comes to personal loans. Make sure that you have a good credit score and have all the required documents in place before applying for a personal loan. Another disadvantage is that personal loans have a higher interest rate when compared to RV-specific loans.
- In some cases, the personal loan might have cheaper interest rates. Ensure you get the right personal loan and check the interest rate before applying.
Check for collateral or home equity loans
- Collateral or home equity loans are also common. Many people use their collateral to finance an RV over 10 years old. This is an easy way out since most banks and other RV lenders easily sanction a loan with collateral in place.
- A line of credit or home equity loan can provide the funds to finance an RV. Many people use their property as collateral for an RV long. However, this is not one of the best approaches since your property is at risk in case of default. Failing to pay on time can be troublesome. There is more risk in collateral or home equity loans.
Average interest rate for RVs over 10 years
- Understanding the average interest rate for RVs over 10 years before financing one is important. The interest rates can change according to the market and lender. However, it is essential to know that RVs over 10 years might have a higher interest rate when compared to new RVs.
- The average interest rate can start from 5.24 percent to 30 percent. Those with an average credit score can expect an interest rate from 7.0 percent to 9.25 percent for a used RV.
- The only way to decrease the interest rate is by paying more than 30 percent of the down payment. Another option is to increase the monthly payments by decreasing the tenure.
- It is also important to note that many RV-specific lenders might not provide a loan for RVs in the 13 to 15-year-old range. However, if you have a down payment of 40 percent with a high credit score of 720 or above, you should easily get a loan.
- Always hire an inspector before deciding on the make and model of the RV. An inspector will be able to determine the actual cost of the RV based on its condition. This might cost $100 or more, but it is worth it.
- An inspection will also help you find the perfect rig based on your budget. An inspector can also discover any major issues with the RV.
In this blog post, we have answered the question: “How to finance an RV over 10 years old?” We have discussed the possibility of financing an RV over 10 years old. We have also touched up on the credit score and other important factors. Furthermore, we have discussed the average interest rate for RVs over 10 years.