It is common practice for most people to find a company who can finance for the things they want to acquire. The most common items which people apply for financing are cars and houses.
But for this article, we will be talking about financing recreational vehicles. Here are some tips which can help you with your recreational vehicle financing.
The first thing you need to do when you are planning to have a company finance for your recreational vehicle is to improve your credit score. Financing companies look at your credit standing and usually, this is the basis of these companies for approving your loan.
It is always best to be prepared. So try to improve your credit score and make it get as high as it can. This way, the chances of having your loan application approved is high.
It usually helps if you find someone who can help you boost your credit score. Remember that a low credit standing will not give a good picture.
This is a very important step, so please read this article about credit score and how to improve it: What is credit score (learn how to improve yours)
THE BEST INTEREST RATE
It is also advised that you ask around for financing companies with the best interest rates. If you are planning to purchase a recreational vehicle which may cost much, then expect your loan to be a big one.
But if you opt for a financing company with lower interest rates, then at least you will be able to have a big savings. You should also look out for interest rates of banks, credit unions, and of course, the recreational vehicle dealer.
Recreational vehicle dealers usually offer competitive interest rates. These companies may also act as brokers for other lending institutions.
GO WINDOW SHOPPING
Just like when you shop for other things, going window shopping may also be applied when buying recreational vehicles. Shopping around will give you the opportunity to look for recreational vehicles with lower prices, and probably better interest rates.
You can also decide on the option of buying a brand new recreational vehicle or a used one. If a second hand recreational has all the features and amenities you want, why not. Just make sure that it will be a good buy.
CONSIDER USED RECREATIONAL VEHICLES
It may also be a good idea if you consider buying used or second-hand recreational vehicles. Buying Brand new ones may be a bit expensive.
If you really do find it necessary for you to purchase a recreational vehicle, and you are on a tight budget, then maybe buying a used recreational vehicle a wise option to consider.
Buying brand new recreational vehicles is not a guarantee that it will last longer and will be of good quality. This will also give you more control on your budget. It will give you enough savings to have your recreational vehicle remodeled to the way you want it to look.
Buying second hand or used recreational vehicles can give you the opportunity to fix it up according to your needs and style. You can buy fixer ups at cheaper process then just remodel it to have it look like your dream recreational vehicle.
This may not be a good idea for some, but if you plan well and know the ins and outs of fixing up used recreational vehicles, then you are sure to come up with a recreational vehicle which will be the envy of many.
There is an option for you to buy a less expensive recreational vehicle, especially if you are living on a budget. But if you really do think that acquiring a recreational vehicle is a must, then this is a wise decision.
Buy a less expensive recreational vehicle, but of course, one that will at least meet some of your standards, then remodel it later when you have the budget for it.
Remodeling can be done one step at a time. So you will not be needing that much budget in just one go when it comes to remodeling. And in due time, your recreational vehicle will have the features of your dream recreational vehicle.
SETTING A BUDGET
Before deciding on what kind of recreational vehicle you want, you must first set a budget. Just like when you make purchases of certain things, especially those which will play a major role in your life, set a budget.
The budget you set must be within the limit of what you can afford. This way you can look for a recreational vehicle which will be within your budget and not overspend for it.
When you set a budget, do not look at the monthly amortization you may get from financing for a recreational vehicle. Look at the whole cost of the transaction instead. Buying a recreational vehicle within your budget will not make you worry about monthly amortizations. Besides, what better way to enjoy your newly acquired recreational vehicle than to have no worries about it and just have fun.
The first problem you have to face when it comes to financing is the downpayment. The usual downpayment required downpayment for a recreational vehicle financing is 10% of the cost of the recreational vehicle.
So as much as possible, save at least 10% of the cost of the recreational vehicle yo have in mind. If you can put up a larger downpayment, then at least you will have a lower monthly amortization. This will also give you a leverage when negotiating.
There is a trend in financing rates. It depends on current market trends. If the dealer offers you a deal, check with your bank or credit union first. Whoever offers a deal with lower rates, then go for it.
Since financing rates vary, they may increase or decrease depending on the trend. You can make auto loans as a guide. If auto loan rates are low, that means recreational vehicle financing rates may be low also. This may be a good time for you to purchase one through financing.
WAYS IN FINANCING A RECREATIONAL VEHICLE
There are several ways in which you can acquire a recreational vehicle through financing. It may be through the recreational dealer itself, or a third party (a bank, a credit union, and others).
Before you decide on how to finance your recreational vehicle, try to see what these financers have to offer you. Go for the one which gives you the best deal.
Third Party Financing
Third party financing is when you acquire your recreational vehicle through a bank, a lending institution, or a credit union. Engaging the services of a third party financing company may give you leniency when it comes to a skipped or delayed monthly payment.
One problem with third-party financing is that you cannot finish or close the transaction in one day. There are certain procedures to follow, which may take quite some time.
Recreational Vehicle Dealer Financing
Another way to financing a recreational vehicle is through the recreational vehicle dealer himself. But before you go into a financing transaction with your recreational dealer, ask around. Meaning, do some research about the company and its past financing transactions.
If possible, ask around. You might know a friend or two who have had businesses with the said dealer. Gather as much information as you can about the dealer. Weigh the information you have gathered. If it is to your satisfaction, then probably you can close a financing deal with the recreational vehicle dealer.
THINGS TO LOOK OUT FOR
When planning to go into a transaction involving the financing of a recreational vehicle, there are several things to look out for and be aware of.
End Of The Season Purchase
Just like any other things which are seasonal, it is best to purchase recreational vehicles at the end of camping season. Why? Because of the obvious reason that prices of recreational vehicles go down during these times.
In negotiating for deals and offers, you may be misled by some things. There are dealers who put up their merchandise on sale. Scrutinize it properly before grabbing it.
There are cases when dealers increase the price of a merchandise by 50%. Then they offer, let us say, a 50% discount. Naturally, an impulsive buyer will grab the offer. But if you are a careful buyer, you will find out that the discount will not really be 50%, but less, or much worse, there might probably be no discount at all.
The Right Incentives
Salespeople, by nature, are sweet talkers. To increase sales and to have bigger incentives, they need to meet their quota. So if they see an opportunity, they grab it.
A prospective recreational vehicle buyer is like cold water to quench the thirst of these salespeople. They will sweet talk you and do whatever things they can within their power to persuade you to make a transaction with them.
The things they offer you about incentives and stuff may sound enticing. Be careful. These promised incentives may not be true. It might be that they are just saying these things to close a deal with you.
Be meticulous and ask questions. Do not be impulsive and go into a transaction with them, which you might regret later on.
Bottom line is, do not be impulsive when planning to buy a recreational vehicle through financing. Ask around and see what options fit you best.