Generally, an average RV loan ranges from 10 to 15 years, depending on your lender. Other banks, online lenders, and credit unions may decide to extend an RV loan term to 20 years.
The term length of an RV loan is also dependent on how much you are taking out and, of course, the lender you are working with. When considering an RV loan, it is important to know what to expect before applying for the loan.
While RV loans come with terms between 10 and 15 years, you can still find repayment terms for as long as 20 years or as low as two years. This is dependent on the overall cost of your vehicle, your financial situation, and the lender.
How to Decide the Length of Your RV Loan
The first thing you need to do before applying for an RV loan is to reach out to a professional about how to get an estimate of how much you’ll likely pay throughout the life of the loan.
You can also use an RV loan calculator to get the estimated amount you might pay. When calculating the estimated cost, consider the following:
- Sales tax
- RV price
- Down payment
- Estimated interest rate
- Trade-in-value
All of these would help you determine if you need a shorter or longer repayment term. It is important to also consider the RV age and model, including your credit score.
This is because these factors can affect the terms offered by your lender. You can also shop around and compare the best RV loans to get a lender that best suits your needs and budget.
Factors That Affect RV Loan Term
Highlighted below are factors that play a crucial role in determining the length of an RV repayment term:
- The Lender: the type of lender you work with is one of the determining factors of your RV loan term. Typically, dealerships offer longer repayment terms compared to credit unions, online lenders, and banks. You can get up to a 20-year repayment term from a dealership and two to seven years from personal loan lenders.
- Loan Amount: The amount of money you intend to borrow also affects your RV loan term. If you are taking out a large loan amount, some lenders may offer longer repayment terms.
- RV Age and Condition: Because RVs depreciate, some lenders can limit the term length based on the perceived risk of the condition of the RV. If your RV is in good condition, you can get a competitive loan rate.
- Credit Score: Your credit score also has an influence on the type of loan term you get from lenders. In most cases, if you have a high credit score, you’ll likely get a longer loan term. Those with lower credit scores are considered high-risk and are offered shorter term lengths.
How to Apply for RV Loans
If you plan on applying for an RV loan, follow the steps highlighted below:
- Review Your Credit Score: Knowing your credit score ultimately helps you to opt for the best lender. Most lenders have their own unique credit requirements to get approval for an RV loan. Check your credit score and match
- Compare Several Lenders: Comparing RV loan offers enables you to get a low interest rate and manageable monthly cost. This lets you see the loan conditions you qualify for and also the estimate of your monthly payment.
- Prequalify: Check to see if the lenders you’ve selected offer prequalification. Prequalifying for an RV loan is a quick way to see the rates and terms that are available without any effect on your credit score.way
- Shop for an RV: Prequalifying for a loan gives you an additional advantage because you probably already know what kind of RV you are choosing. Once you have decided on the lender to work with, send in your loan application.
FAQs
What are the documents required to apply for an RV loan?
When applying for RV loans, there are certain documents you are required to provide alongside your application. You’ll be asked to provide proof of income, an identity card, and proof of assets before your loan is approved. Your proof of income should include bank account statements, paystubs, or tax returns.
In addition, your lender will also need information on what type of RV you intend to buy, the model, age, make, and sale price.
What’s a good interest rate for an RV loan?
A good interest rate for an RV loan depends on the rate you qualify for as a result of your credit score. If you have a good to excellent credit score, you’ll most likely qualify for a lower interest rate. You can explore different lenders, know the interest rate on their loan, and choose the one that you feel is the best for you.
What credit score do I need to qualify for an RV loan?
The credit score needed to qualify for an RV loan varies across lenders. Each lender has its own minimum requirement for the credit score required in order to apply for an RV loan. However, if you have a credit score between the range of 670 and 739, the chances of qualifying for an RV loan are high.
If you are the type who seeks the best loan rate, you need an excellent credit score to achieve that.
