Australia is a country with the most diverse type of terrain, and caravanning seems to be a highly preferred activity there. Hence, a large number of adventurous populations opt for bad credit caravan loans.
Close to 21% of the population in Australia has bad credit. The only option in such a situation is to ensure that the next adventure does not suffer because of it.
So here’s how you can buy an RV or a caravan even with bad credit.
1. Determine a payment plan.
When evaluating whether to approve a loan for someone with bad credit, the question all lenders are most concerned about is if the person is capable of repaying it. Using an RV loan calculator to estimate a reasonable payment and budget is a great way to get started.
However, the payment plan should not be unreasonable. This is because there are other expenses attached to purchasing an RV, such as:
- Campsite fees
Furthermore, the age of the RV may have an influence on these prices and drive them up or down accordingly.
2. Save 10% for a down payment.
Typically, RV dealerships request a 10% down payment on the purchase price. Others might ask for a 20% down payment. Hence, it is wise to start saving for a down payment as soon as possible. Bigger down payments will lower monthly payments, as well as the interest rate and total cost of the loan.
Furthermore, a more significant down payment from someone with bad credit may boost the likelihood of RV loan acceptance since it decreases the borrowing amount and minimises risk for the lender.
3. Look for a lending partner.
RV dealerships commonly provide loan options from partner lenders. Although this is an excellent option as they handle the loan procedures for the customer, they may not necessarily offer the lowest prices.
Some RV dealers also provide in-house financing solutions that are more credit-friendly, but they can be expensive.
Many customers, however, prefer to finance their caravans through a private lender. With a private lender, you can complete the application at home, and the loan is preapproved before visiting the dealership. This also signals sincerity to the dealer and puts you in a better position to negotiate the price of the RV.
4. Negotiate the price before signing the paperwork.
Before committing to buying an RV, shop around for the best deal. Some RV dealers jack up their rates. So, based on the RV and other conditions, you can expect a discount of 20 to 30%.
Alternatively, you can request additional incentives or services that reduce the purchase price. These can include things like complimentary maintenance or upgrades. By lowering the purchasing price of the RV, you can effectively reduce the total financing costs.
Exploring the wilderness does not have to wait. With bad credit caravan loans, you can make it happen almost instantaneously. While it may take a bit of convincing and a bunch of paperwork to be approved, it is still a pretty feasible option for those looking to head out for a quick break or even an extended vacation.
So, don’t wait any longer. Get in touch with a financial advisor to clarify whether an RV loan is possible despite the bad credit!