Caravan loans – Hit the road in your perfect mobile home
Got your eye on a new caravan? You’re probably geared up to hit the road and every Australian travel hotspot along the way. But, if you need some extra cash to make the purchase, you’ll first need to check out this caravan loans guide.
What is caravan financing?
When you need to go caravanning sooner rather than later, caravan financing gives you a cash flow boost that covers full or part payment for your chosen vehicle. You then repay the borrowed amount in instalments, over a fixed period and between bouts of open-road tours.
Typically, this flexible arrangement is based on the following loan types:
- Secured. Like car loans, personal loans for caravans can also be secured. That means the lender keeps an eye on your vehicle until repayments are complete. If you default at some point, the lender may repossess the vehicle and sell it to recover the funds you borrowed. But, if you stick to the repayment plan, you’ll be able to capitalise on the low interest rate that’s a direct result of low risk to the lender.
- Unsecured. You can also use an unsecured personal loan if you want to own a caravan without tapping into your personal pool of funds. The good news is the lender won’t be able to take you off the road with a repossession when you miss payments. However, they may level down the risk of financial loss by charging higher rates.
- Fixed. With a fixed-rate personal loan, your interest rate is locked in. It, therefore, doesn’t have the freedom to move up or down. While you miss out on potential savings if market rates go down, it’s simpler to keep your budget on track throughout the repayment period.
- Variable. A variable interest rate has more room to fluctuate depending on the Reserve Bank cash rate. On the one hand, you get the benefit of paying less each time the lender implements a rate cut. But, they can also inflate your repayments and your budget along the way.
Other types of caravan loans
- Self-employed. You’ll still need some time off even if you’re your own boss. If a caravan represents much-needed downtime, you can use our comparison website to find an offer with the right lending criteria. This also applies if you’re a pensioner or casual worker searching for a finance provider with more inclusive requirements.
- Joint applicant. Since a caravan has more than enough room to allow travel with your best mate or partner, you might want a personal loan that also takes a co-borrower on board. Ideally, that means you both share in the fun while keeping each other accountable for the repayments.
- Bad credit. Finding a personal loan when you have bad credit may seem like a tough assignment. However, that doesn’t mean you have to leave your dreams parked by the side of the road. If you’re willing to subscribe to higher rates, it’s easier to come across lenders who will consider your application.
- Specialised caravan loans. Some specialist lenders offer loans with a few tweaks to match the needs of caravan buyers. Usually, this includes products with built-in insurance, extended warranties, and credit protection plans.
How do caravan loans work?
These few key steps will keep you clued in when choosing an option that squares with your budget and needs:
Find out how much you need to borrow for the purchase
Typically, caravan loan amounts have a minimum cap of $1,000 and a maximum cap of $100, 000. However, your borrowing capacity tends to narrow or expand based on your credit history, your monthly earnings and expenses, plus the lender’s terms. If you’re going for pricier motor options, you’ll ultimately need to dedicate a bigger slice of your budget to the repayments.
Pick a loan term
Personal loan terms have a range that sweeps between 1 and 10 years. A shorter term allows you to wipe out your debt more quickly, though you’ll have to deal with larger repayments. However, in the interest of affordable repayments, a longer term will be more considerate on your budget.
Compare caravan loans
Before financing a caravan, you’ll want to scout for different loan products with better features. During your quest for the best finance option, it pays to use the right caravan personal loan comparison tools.
BestFind’s comparison table delivers authorised offers from the Australian caravan loan marketplace right to your doorstep. By applying the right filter, you can quickly sift through the showcased loan options. Here’s what to consider when comparing financing solutions:
- Interest and comparison rate. The interest or advertised rate is a big-name factor that can potentially save you thousands of dollars if you manage to single out a competitive figure. However, you should also be able to spot offers that masquerade as low-interest and cheap while carrying steep fees and charges on the side. Looking at the comparison rate helps since it usually includes all fees (standard) plus the interest rate. Common fees to watch out for include upfront fees, ongoing monthly fees as well as late payment or early termination fees.
- Flexible repayment options. Can your repayments be arranged according to your cash flow? Depending on your circumstances that might mean opting for weekly, fortnightly, or monthly repayments. In addition, you should also be able to choose a convenient repayment method. This can be through BPAY, direct debit, or manual transfer.
Use the caravan loan calculator
Enter your selected amount and term into our caravan loan repayment calculator. This is another crucial tool that helps you to work out the dos and don’ts of your budget. With caravans costing up to hundreds of thousands of dollars, it’s crucial to confirm what your budget can handle before settling for your dream pick. Using the caravan finance calculator in this way also boosts your chances of approval since lenders only agree to a deal when they know you can afford it.
Make your application
Another advantage of using our product table as your marketplace is the quick application process. Once you find a caravan loan that parallels your financial needs, click the ‘Go to Site’ button. This immediately links you through to the lender’s website. From this point, you’ll have to complete and submit an online personal loan application form.
Generally, to be eligible for a caravan loan, you must meet the following requirements:
- Be at least 18 years of age
- Be an Australian citizen or permanent resident
- Have a driver’s licence
- Give proof of income or bank statements and payslips
- Give proof of address or a utility bill
- Provide details about your other debts, expenses, and liabilities
- Have a good credit rating
If you’re successful and your loan contract comes through, be sure to give it a thorough once-over. The goal is to ensure you see eye to eye with the terms and conditions.
What’s in a caravan buyer’s guide?
Even if your home is out on the road with you, modelling the perfect environment is just as essential. Fortunately, caravan finance covers a wide range of vehicle types. That means you can easily control the comfort of your mobile home, starting with the purchase.
- Conventional. This basic type comes with a full-height roof and solid protection from the elements. They can be single-axle or double-axle. Either way, they’re trendy because of their spacious dimensions, multi-room plan, and built-in furniture.
- Poptop caravans. Unlike conventional caravans, poptops are on the smaller side. However, you’re able to lift the roof if you want to create more headroom or air out your living space.
- Popout caravans. These caravans take it up a notch as you can not only lift the roof, but you can also pop-out certain sections on the ends of the van. It’s perfect for large families who want to travel light while utilising on-demand storage space.
- Recreational vehicles (RVs). Also called motor homes, RVs are 2-in-1 vehicles in that they also function as your home. In terms of comfort and convenience, they generally offer little set-up, fold-out sections for extra space, plus all basic amenities.
- Fifth wheelers. These large vehicles could be your ideal mobile home. They usually surpass even conventional caravans when it comes to storage space and comfort level. Typically, you tow them behind a truck as you move from campsite to campsite. However, there may be some movement restrictions due to size.
- Teardrop trailers. Camper trailers are small and easy to tow, without sacrificing basic amenities like bedding and kitchenettes.
4 tips to help you shop for that perfect caravan
- If you’re planning on going off-road with heavier loads, go for a vehicle with a robust chassis and suspension to avoid getting stranded.
- Besides the purchase price, make sure you also budget for other extra costs. These include modifications, servicing, repairs, insurance, and storage.
- Make sure you’re familiar with towing requirements in Australia, so you can drive legally wherever you go.
- When it comes to bedding ensure there’s enough space for large-family trips or weekend drives with friends. It’s also important to make sure the available trailer space is not cramped. After all, quality rest is just as important while on the move.
Frequently asked questions about caravan loans in Australia
Can I get financing to buy a used caravan?
Yes, personal loans are generally flexible enough to let you purchase a used vehicle. However, if the loan is secured, the lender might place a few restrictions to ensure the vehicle is in good condition.
How long does approval take if I apply?
It depends on the credit provider, but loosely speaking, it can take anywhere from 24 hours to a few weeks.
Can I get pre-approval if I apply for a caravan personal loan?
Yes, it’s easier to get pre-approval on a personal loan. This, in turn, gives you more negotiating power when caravan shopping.
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