Getting the best RV finance deal

By: Peter Quilty


In the fourth instalment of a six-part series, we advise how you’ll know you’re getting the best rate when it comes to RV finance.

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Securing a loan to purchase a caravan or RV is one thing, paying for that ‘bundle of joy’ is another matter.

Obviously we all have various forms of expenditure – and more often than not it can be a budgetary juggling act.

But you want (and deserve) to enjoy the adventure and freedom of a travelling lifestyle without worrying whether you can meet the weekly, fortnightly or monthly repayments on your big investment.

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So, here’s some invaluable advice which hopefully will make you feel comfortable you’re getting the best rate when it comes to caravan or RV finance.

Consumers can be overwhelmed by the multitude of choices – banks, finance companies, peer to peer and so on – and most are pushing their own products.

"What clients want is independent, unbiased advice," says Jarred Lembo – general manager of leading industry financier, Credit One.

"Clients need to look at all options – early termination fees, establishment fees, monthly account keeping fees and so on. And it’s hard to run around seeing a myriad of caravan lenders face to face."

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Rather than spending hours on the phone or searching for the fine print in terms and conditions, Lembo says specialist finance brokerages such as Credit One "can do all of the running around for you".

"We can compare options for over 30 of Australia’s best caravan lenders," says Lembo.

"It's essential to obtain a great overall package not just a good-looking repayment structure. And always consider a fixed-term caravan loan rather than adding to the home loan as a specialist caravan loan is much cheaper than personal loan."

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Lembo advises buyers to look for a finance broker who compares all of your options, so you don't have to, then does the legwork for you and deliver the lowest overall financing cost. Finance brokers such as Credit One also give you the ability to shop with confidence knowing that you have the buying power of one of the Australia's leading finance brokers behind you.

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Some of their benefits include:

  • Providing competitive interest rates and products.
  • Seeking flexible loan terms from one to seven years.
  • Providing no-obligation quotes.
  • Being affiliated with many reputable lenders, providing a wide range of products.
  • You are assured quick and no-fuss service.

If you are purchasing a caravan or RV and are looking to explore your finance options, there are several types of low-rate caravan finance options available to you.

Specialist finance brokerages such as Credit One give you access to some of Australia’s best lenders, offering some of the lowest interest rates in the market and a service guarantee that is second to none. And they work closely with some of Australia’s leading caravan brands.

In other words, if you are looking for the best rate on caravan finance the good news is that with financiers such as Credit One on your side you can be spoilt for choice.

"Credit One offers lowest rate caravan loans and finance for personal and business use," says Lembo.

"At Credit One we can offer a great low rate on dealer caravan sales and also private sales.

"Generally most clients financing a caravan for personal use will choose a secured caravan loan. Much like a secured car loan, the financier has registered security over the asset while you are free to enjoy your pride and joy."

Lembo adds that Credit One can also arrange personal loans for caravan purchases.

"Like most personal loans, no security is taken and the loan can be used for a worthwhile purpose," he says.

Leading brokerages can also arrange finance for caravans purchased for business use.

So if you have a business that requires a caravan, RV or camper trailer as an asset that will be used in the business, they can structure a chattel mortgage or other business use caravan loan that best suits your cashflow requirements.

Using an online loan calculator is a useful tool to help you estimate your weekly, fortnightly or monthly repayments on your caravan loan. It’s an easy-to-use tool that can help you compare loan options, and determine a loan amount that most suits your budget.

NEW OR USED CARAVAN?

Specialist lenders aim to make the process of purchasing a new or used caravan as streamlined and simple as possible. Whether you are looking to purchase your caravan through a caravan dealer or from a private seller, they can provide personalised finance solutions with affordable repayments and same-day approvals.

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The vast majority of specialist lenders have the buying power, negotiation skills and expertise to find the caravan loan product that will suit you, your individual financial situation and your personal preference.

But how should you compare your caravan loan options? Another industry financier, 360 Caravan Loans, has some invaluable advice:

Find out the interest rate. Although they are usually competitive, interest rate variations can potentially save you a lot of money.

Decide on whether you're willing to secure the loan. Unsecured loans carry less risk but you pay for the privilege, so choose the type first then compare fees and charges.

How flexible are the loan repayments? Most caravan loans offer flexibility when it comes to repayments but some offer more than others, with options varying from fortnightly or monthly repayments by BPAY or direct debit.

Consider the length of the loan. Term lengths on caravan loans can vary between institutions and the sum borrowed. That said, it’s a good idea to understand the time it takes to repay the loan before signing on that dotted line.

And what to avoid with a caravan loan?

Top of the list is to avoid over-committing to a high loan. You need to understand exactly what you can or can't afford. After all, caravanning is all about to enhance your lifestyle. Also, read the contract with a fine-toothed comb. As with any loan contract or financial commitment, thoroughly read through the contract so you know what you're up for.

Another excellent piece of advice is to always check the comparison rate. The comparison rate is a reliable measure of what you can expect to pay reflected as an interest rate figure, taking into account the basic interest rate, ongoing fees and charges. Factors that influence comparison rates also include the loan sum, the frequency of the repayments and the length of the term.

It's important to remember, too, that comparison rates exclude fees such as stamp duty or any penalties paid like the early repayment fee.

In forthcoming issues of Caravan World, we’ll cover the following caravan finance topics:

Insuring your financed RV: How/where/why/who?

Ready to buy: Getting your finance pre-approved before you hit the shows for the best deal!

The full feature appeared in Caravan World #573. Subscribe today for the latest caravan reviews and news every month!