RV Financing

[sandsys]

I received a mailing today addressed simply to Residential Customer that I thought might interest some of you. West Financial, a branch of SharePoint Credit Union. is offering RV loans as low as 3.74% apr for 72 months. I've never received an ad for an RV loan before so this really caught my attention. That rate may be because there's a new office in my neighborhood but any of you interested might want to check out sharepointcu.com/save.

Linda Sand

[Kirk W]

West Point Financial loan rates

[Optimistic Paranoid]

Interesting.  My credit union is charging 8.75% on RV loans for people with an "A" credit rating.

[tsothermail]

I got a 7% 15 year loan thru lending tree

[momdoc]

WE got an excellent rate this spring using Alliant credit union (very easy to join)

 

[jc2]

Our recent purchase/trade  for a 2010 Dutch Aire was through Ally Financial @ 5.25% for 15yrs.  Was handled by MH of Tx.

[dhuse]

Under 5 with BofA for 20 years on brand new mh.

[sandsys]

Those are all good rates but not as good as "3.74% apr for 72 months." 

Linda

[Twotoes]

72 months is only 6years. The shorter the term the lower the rate. Longer terms always have higher rates because there is more time for you to possible default, hence more risk to the lender. 

[Big5er]

And financing for 6 years, even with that interest rate, would make the payments on my fifthwheel around $1900 a month. And the last time I financed something for 72 months, Mercedes gave me 1.2% through TD Bank. Last payment gets made next week, 2 years early. I

Seeing the rise in interest rates (hadn't paid attention until this thread) makes me glad I bought my trailer last year. 

[FL-JOE]

12 hours ago, sandsys said:

Those are all good rates but not as good as "3.74% apr for 72 months." 

Linda

Most newer RVs cost a little more than vehicles.  My monthly income would be stretched pretty thin if I had financed my RV for 72 months even at 0% apr.  

[Kirk W]

3 hours ago, Big5er said:

Seeing the rise in interest rates (hadn't paid attention until this thread) makes me glad I bought my trailer last year. 

 

7 minutes ago, FL-JOE said:

My monthly income would be stretched pretty thin if I had financed my RV for 72 months even at 0% apr.  

I haven't paid a lot of attention to them either. Your point also should help others to grasp the reason so many of us on fixed incomes try and live with what we can pay cash for. 

[FL-JOE]

10 minutes ago, Kirk Wood said:

 

I haven't paid a lot of attention to them either. Your point also should help others to grasp the reason so many of us on fixed incomes try and live with what we can pay cash for. 

Actually many financial advisors would probably tell you that dumping most of your saved money out to buy a depreciating asset is not wise.  For example, RVer #1 has $100,000 invested and in the last 2 years has averaged 7% return on that money. He finances a $100,000 RV for 15 years at 4.5%.  In 15 years even if he doesn't keep averaging 7% on his money he will at least increase that $100,000 to $175,000.  As far as the RV goes, it doesn't matter if you pay cash or not it still won't be worth anything at the end of 15 years.

I'm not saying this is the right or wrong way of doing it.  Everyone has to handle their finances the way they see fit.   

[Kirk W]

4 minutes ago, FL-JOE said:

Actually many financial advisors would probably tell you that dumping most of your saved money out to buy a depreciating asset is not wise.

I'm no financial advisor, but I sure would agree with that statement. You also need to have the monthly income to make those payments for all of the years of the loan, while realizing that your expenses are going to increase but your income will not. I have long been an advocate for cautious financial planning. We chose to spend less on the RV in order to have a safe reserve without any monthly payments. 

[FL-JOE]

4 minutes ago, Kirk Wood said:

I'm no financial advisor, but I sure would agree with that statement. You also need to have the monthly income to make those payments for all of the years of the loan, while realizing that your expenses are going to increase but your income will not. I have long been an advocate for cautious financial planning. We chose to spend less on the RV in order to have a safe reserve without any monthly payments. 

I am not a financial advisor either, nor have I ever used one.  A buddy of mine (business owner) has some sizable wealth, unlike me.  He recently purchased a new home in Florida for just under $400,000.  I was shocked when he told me that he secured a 30 year loan with only 5% down.  I quizzed him on why he hadn't just paid cash and he educated me a little.  

[Kirk W]

1 minute ago, FL-JOE said:

I quizzed him on why he hadn't just paid cash and he educated me a little.  

Reminds me of a friend who went out and bought a new motorhome just a week after being diagnosed with terminal cancer. He financed it as long as possible and put a life insurance policy on the loan since those do not ask about health. His prognosis was 2 years and he lived for 3, but the RV was financed for 15 years so he left his widow a paid for motorhome that was 3 years old.  But Emmit had the means to comfortably make those payments while maintaining his living standard. Had we bought the diesel pusher we dreamed of and financed it for 20 years, we would still be paying for it and our living expenses have increased significantly in the 18 years that we have been retired. 

[jamtracy]

Has anyone financed their RV this current year? If so can you please tell me where and the rate?

We financed $47K from Alliant credit union 5 years ago 4.75 for 12 years.

We sold that RV and now they want 7% for 15 years on the new one. We were only 5 years removed from a bankruptcy discharge when we bought the last one. Now we are 10 years removed. Our income is 20% more now. All they say is the rates have gone up. I know the rates have gone up because in the Escapees magazine from 2 years ago show rates at 2.99 from alliant and 3.99 from Essex (Bank of the West). In the current issue Bank of the west starts at 4.99 and I don't see Alliant advertising in it. It's very mind boggling. Our only debt is our home, Truck (TV) and car. No CC debt or any other. We have the 10 or 15% they want for a down.

Thanks,

James

[Barbaraok]

I notice that no one mentions that there are times that financing can make sense.   For example, if your would be paying $100K from a tax exempt account, then you would have to pay income tax at a much higher rate (~25%) on that amount, and then the $100K would be gone.   If, however, you had a low interest loan and the tax exempt account was earning at a rate higher than the loan interest, you would end up with not only the $100K intact at the end of the loan period, but MORE than you started with plus a rig that has the same value as if you paid cash.   This assumes that you have an income stream that is sufficient to make the payments.  

[dhuse]

James

We purchased our '19 Winnebago dp a month ago. Even with a credit rating of 830, the best we could do was B of A for 4.99% for 20 years. Good hunting.

[sandsys]

59 minutes ago, dhuse said:

the best we could do was B of A for 4.99% for 20 years.

Be aware that you don't have to take twenty years to pay off a twenty year loan. Making extra principle payments brings down the balance due very quickly while still taking advantage of the low interest rate.

Linda

[Kirk W]

Just now, sandsys said:

Be aware that you don't have to take twenty years to pay off a twenty year loan.

Make sure that there is no early payment penalty. It has been a long time since I borrowed any money, but some loans used to have such in them, usually far down in the multipage forms where most people didn't bother to read. 

[dhuse]

Both good points.

 

Doug

[Barbaraok]

4 hours ago, sandsys said:

Be aware that you don't have to take twenty years to pay off a twenty year loan. Making extra principle payments brings down the balance due very quickly while still taking advantage of the low interest rate.

Linda

It is amazing what doubling early principle amount can do for you.  😉

[FL-JOE]

23 hours ago, jamtracy said:

Has anyone financed their RV this current year? If so can you please tell me where and the rate?

We financed $47K from Alliant credit union 5 years ago 4.75 for 12 years.

We sold that RV and now they want 7% for 15 years on the new one. We were only 5 years removed from a bankruptcy discharge when we bought the last one. Now we are 10 years removed. Our income is 20% more now. All they say is the rates have gone up. I know the rates have gone up because in the Escapees magazine from 2 years ago show rates at 2.99 from alliant and 3.99 from Essex (Bank of the West). In the current issue Bank of the west starts at 4.99 and I don't see Alliant advertising in it. It's very mind boggling. Our only debt is our home, Truck (TV) and car. No CC debt or any other. We have the 10 or 15% they want for a down.

Thanks,

James

James, late last fall Alliant was doing RV for 10, 15, or 20 years below 5%.  Haven't checked on 2018 rates.  Are you going through your dealer and if so are you sure they are not adding on?

[Big5er]

Strangely enough Alliant doesn't even show an RV loan for more than 10yrs on their web site. Big label says 4.9% with a max term of 120months. But in the fine print it says loans up to $300k and 20 years??

It seems most of the others (Good Sam/Essex, USBank) that are posting their rates online are running in the low to mid 5's. Bank of the West and Southeast Financial aren't even posting their rates any more.