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Want to finance an RV? Try out these alternative loan options

Posted 02.09.2020
Want to finance an RV? Try out these alternative loan options

Everyone needs a vacation once in a while, and while it’s a good idea to lay back and contemplate what you’re doing with your life, it can be a hassle if you don’t come prepared. But why is it such a hassle? One word: budgeting.

Having a vacation can be costly, especially if you didn’t save up money beforehand. Creating a budget and sticking to it as you spend money on your vacation is essential if you don’t want to take on debt- that is, if you saved up enough money for the vacation. In reality, however, many Americans rack up so much debt in just a single vacation.

It’s not surprising, to be honest. There are many things you need to spend on a single vacation like your lodgings, car rentals, flight expenses, or RVs. Fortunately, there are alternative loan options if you want to finance an RV. But first, let’s delve deep into what an RV loan is and how it works.

What is an RV loan?

An RV loan is a type of loan that helps you finance an RV. This type of loan is a long-term loan that can be used to buy a motorhome, a camper, or a travel trailer. These RVs do not come cheap and have a range of at least $10k to a million, or even more. For this reason, many RV buyers need to rely on some form of easy financing to purchase these vehicles. Thus, RV loans exist.

However, if you want to opt for second-hand vehicles that are still usable, there are lenders in the market that offer loans, allowing you to purchase new ones or used vehicles. Also, there are a lot of alternative lenders in the market, not just banks. You can find lenders online, credit unions, or RV dealerships that run promotions or loans to help their customers buy an RV.

More often than not, RV loans are made as collateral once you’re unable to pay the loan itself. However, this can also be a good thing since a loan that puts up your purchased RV as collateral means you don’t have to put your other valuable assets on the line.

Since RVs are expensive, the repayment terms for RV loans are typically long, like 10 to 15 years. It’s like this to make the repayments more affordable and customer-friendly. If you are looking for RV loans with good credit that don’t last that long, you can find one if you look hard enough. Some even offer less interest if you’re able to pay for the loan before the repayment period ends.

However, if you aren’t sold on taking out an RV loan, check out these alternative options that you can opt for your next vacation.

RV type loans

If you are shopping for loan rates for your RV, you can try finding one that is specific for the RV that you want to buy. Major banks and other alternative lenders have reasonable rates. However, the percentage you will pay in interest will depend on whether the RV you’re buying is new or not or whether it is from a dealer or a private party.

If you’re buying from a dealer, lenders tend to give you the best rates and a warranty from a dealer, which is an excellent deal for most. But if you’re buying from a private party, interest rates tend to go up, although private parties can be negotiated about the principal amount you will pay.

Dealer loans

Under the category of RV type loans are dealer loans. Generally, RV dealers tend to offer financing on their expensive vehicles, just like your typical auto dealer. A lender typically backs this in-house financing, but you can submit your application through the dealer and the negotiations about the RV. Not only that, but dealers also tend to give off discounts and promotions when you’re buying higher-priced RVs.

That said, if you’re planning to buy from a dealer, you can ask if they are running discounts or other promotions that can affect the final price of the RV. Probably the only drawback of financing an RV through a dealership is that it is much more of a hassle to process since there is a lot of paperwork and admin works, making it more challenging to obtain than an auto loan.

Third-party loans

If you are determined to get better RV rates, you can compare rates from banks, dealers, and alternative lenders in your area. Yes, dealership loans are more convenient to obtain. However, they can cost more over the life of the loan.

This is especially true if you didn’t enjoy a discount or a promotion that reduces the RV’s final price, not to mention that dealerships sometimes have a higher interest rate.

Also, your credit score will affect your chances of obtaining an RV loan significantly. If you manage to apply for the RV loan successfully, you’re also more than likely to get a high-interest rate.

Before taking out an RV loan, check your credit score. If it is poor, consider improving it first before taking out the loan. The better your credit score is, the better chances you will land a much better loan in terms of repayment terms and the final price of your RV (if you buy from a dealer).


HELOC or home equity line of credit may be an option for you to finance your RV. The best thing about HELOC is that its interest rates are significantly lower than your typical credit card rate or personal loans. This is because it’s secured with your home. You might want to double-check on that since this can be a significant risk to you. If you default on the loan, your house will be seized, which is unfortunate, to begin with.


If an RV is number one on your wishlist, the first thing you should think about to obtain it is how to finance it. There are a lot of places you can talk to if you want financing options for your RV. However, the process can be a challenge, not to mention risky and costly. That said, do your research, and look for better alternatives and financing options to finally get the RV of your dreams.

About author:

Lauren Cordell is a writer that excels in articles that talk about travel and financing. In her free time, she usually browses her social media and plays board games.

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