RVs have been a staple in the traveling industry for years. Even during the pandemic, RV sales have only increased as a means to attain the freedom to travel without risks.
There are various options for individuals who want to acquire an RV but do not have enough cash on hand to do so. Thanks to RV Financing, this is now possible. It is widely offered by different financial institutions such as online lenders, banks, and credit unions.
Unfortunately, the increase in popularity for RVs, especially among millennials, has also attracted many predators taking advantage of the customers. However, there are things you can do to avoid being victimized by shady RV financing packages.
Do not buy impulsively.
Whatever the circumstances are, do not rush your RV purchase. You have to take your time when planning and making decisions regarding the purchase. Do set a budget that you are willing to put down to acquire an RV. Once a budget is set, stick to it and only choose those units that will fit your budget.
Don’t be in a hurry, especially when shopping for an RV. Even if you already found a unit that you like, do not settle for it until you have sifted through all RV dealers around your area. It is best to buy an RV once you have already established a solid plan, including budgeting, the kind of RV you want, and the purpose for your purchase.
After asking yourself certain questions and you are still certain that you want an RV and already have a budget set solely for your RV purchase, go ahead. Maybe you need an RV after all.
Look For A Verified Financier or Lender.
The most obvious way to avoid shady lenders is to make sure you apply for RV financing from a verified lender or financer. Do a background check on a specific lender before even thinking of applying for a loan.
When looking for a lender or financer for your RV purchase, look for red flags that will tell you if the lender is a fraud, especially if you consider taking the loan from online lenders.
To help you avoid these scammers, here are the red flags that you should look into.
- If the lender doesn’t care about your credit record
- Lenders reaching out to you through unsolicited phone calls,
- Asks for the payment upfront
- Undisclosed fees
- The lender is not registered in your state.
You have to remember that legitimate lenders are clear and precise with their rules regarding financing. They are often strict in their application processes as they need to make sure the person they are lending the money to can pay it back.
If you notice the lender does not bother to secure their money, it is most likely because they won’t be giving you any money at all. Instead, they will just use your information to sell to a third-party company, or worse, use it for identity theft or phishing.
Have a Good Credit Score
Having a good credit score is another way to avoid falling into the trap of bad RV financing. Lenders, most especially bank institutions, will require their applicants to have a good credit score before they consider the application.
If you want to apply for an RV loan, you should have at least a score of 670 to be considered. The higher your credit score, the better chance you will be approved for your RV financing application. Before you apply, check your credit score to know if you qualify.
If you have a lower credit score than what is required, you can still acquire an RV loan. Some lenders offer RV loans to individuals with bad credit. However, this offer comes with a higher interest rate. This is to compensate for the lenders’ risk with providing you a loan despite your credit record.
A low credit score is an indication that you are experiencing financial struggles, and giving you another loan is too risky for the lender. This is also why lenders may also require you to offer collateral in addition to the high-interest rate as a security for the loan you are acquiring.
Don’t Be Afraid To Negotiate a Deal.
Before sealing a deal, try to negotiate with the dealer first. Do not hesitate or be afraid to negotiate whether you are purchasing a second hand or brand new RV. Dealers have already anticipated that buyers will negotiate a deal because this is what always happened.
First, you have to do your homework and search all the RV dealerships within your location and check out their listing. Look for the kind of vehicle you like and check its pricing through all your local dealerships. This will give you a better idea of the price range of the particular RV that you want.
Another thing you should do to get the best deal is to know when to shop. There are certain times of the year that RV dealers are more willing to consider a negotiation than any other time. For example, during late fall, where camping season is starting to lessen, and RV dealers still have current models parked in their shop, they will be willing to let go of these units at a lower price to make room for new models.
Times like these are perfect for acquiring the best deal in purchasing an RV. It is also best to negotiate with multiple dealers and choose the one who will give you the best offer. Do not be afraid of negotiating deals, and you will be surprised by how much you will save.
Shop Around And Do Your Research.
It is best to look for the best institution that can provide you an RV loan. Do not rush into choosing a lender no matter how good a deal they are offering. Although you can shortlist that particular lender but unless you checked all the other institutions, do not decide yet.
After you check all the institutions that can lend you money to finance your RV, it is now time to compare them. Choose what fits your needs and your capability in repaying the loan. Do not limit your search to offline private lenders. You also have to check your local banks, credit unions and even consider online lenders.
You should also consider the RV dealership you are planning to buy your RV from. Talk to them about RV financing as they can also offer you a good deal. Explore your options and take your time in searching for the best deal available.
It is important to have a plan before jumping into a decision to acquire RV financing. Remember, RV loans or any type of loan is a huge responsibility that could affect your financial health if not done right. The RV financing industry will continue to be in demand this 2021 and for the years to come as RV’s trend in traveling has increased, which is expected to continue until this year.
Lauren Cordell is a seasoned freelance writer working for various lifestyle and travel magazine sites. When not busy making ends as a wordsmith, she spends her time chasing after outdoor adventures and pristine beaches. Lauren is also a big RV enthusiast, traveling across different states using her old RV— a sentimental gift given by her father.