Financing for Recreational Vehicles

Many of us enjoy nothing more than adventuring out and exploring our world traveling the open road. Doing this in an RV is the dream of everyone who loves comfort and style. What could be better than taking your home along for the ride? You can make this dream come true by getting the right kind of RV financing!

RV Loans

The easiest way to finance your new RV would be to take out a loan. Most RV loans involve simple interest. This means that each time you make a payment on your loan, a portion of it is allocated to pay for interest on the loan, and the rest would go towards the principal. As you pay down the balance on the principal, your interest payment goes down as well.

You can get RV financing through a bank or credit union as well as other types of independent lenders. RV dealerships also provide financing. To put yourself in a better position to negotiate your loan, it is best to obtain pre-approval for a loan before setting out to purchase an RV.

A typical loan on an RV will run 10 to 15 years; however if you are borrowing more than $50,000 the term on your loan will usually be longer.

Prior to Financing Your RV

There are a few things to think about before you pursue financing for your RV. It is vital to know what your personal credit score is. Because an RV is thought of as a luxury item, people need very good credit in order to qualify for an RV loan. If you find that your credit is less than stellar, take steps to improve it before you seek financing for an RV.

In the meantime do some shopping around so that you familiarize yourself with the prices of RVs and the interest rates being offered. Do not get ahead of yourself in your excitement for owning an RV. You need to be thinking objectively, using good judgment when you evaluate your options. You have got to look at your entire financial picture so that you know exactly what you can afford, how much you can pull together for a down payment, and what terms will work for you before you decide which RV to buy. It is easy to go online to find out what the competitive loan rates are for RVs. Knowledge is power, so give yourself this advantage when you go in to negotiate the purchase price of your RV and your loan. The more you know ahead of time the better.

Down Payment

Most lenders will allow people to put less than 20% down when buying an RV. Many will even be okay with less than 10% down, and some lenders will offer loans with no down payment. For the most part, the more money you have for a down payment, the lower your interest rate will be. If you agree to a loan that has prepayment penalties in the contract, you will usually get a lower interest rate. Make sure you know the implications of this so you won’t regret it later.


One big advantage of taking out an RV loan is that an RV is considered to be a second home, as long as it has sleeping quarters, cooking facilities and a toilet. This means RV owners are allowed to take a tax deduction on the interest they’re paying for their loan.

Many lenders offer automatic bill pay these days, which means your RV loan payment can be automatically paid every month directly from your bank account. This usually works out well for RV owners because they are often on the road and it’s easier because they don’t have to worry about sending a check on time.

Spend some time researching all your options for RV financing, looking for what will work best for you. When you’ve done your homework and examined everything carefully, you will be confident that you’re making the right choice. It will be so much sweeter when you finally are holding the keys to your new RV. Enjoy the ride!

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