Owning a recreational vehicle is a unique experience. It’s become more prevalent in recent years with the rise of digital nomads and the escalating prices of traditional homes. For those looking to sample this lifestyle, RV loans come in different shapes and sizes. The amounts available, terms, and conditions vary from lender to lender. Here’s what to know about financing terms for an RV. 

Secured Loans vs. Unsecured Loans for RVs

The cost for a new RV could range from a few thousand dollars to $500,000 for the more recent models with all the bells and whistles. This may depend on factors such as:

  • Class
  • Size
  • Floor plan
  • Manufacturer
  • Availability

RV financing from the dealership, which is a secured loan, works like an auto loan. The RV is the collateral for the loan, and the buyer is required to come up with a certain percentage of the selling price as a down payment.

Unsecured loans do not require collateral or a down payment. Smaller and used RVs may typically be purchased with cash or by taking out an unsecured loan. Factors that influence the lender’s decision include the applicant’s credit score and debt-to-income ratio.

Budgeting for an RV Purchase

When considering the budget for an RV purchase, individuals should assess both upfront costs and long-term expenses. This includes factoring in the price of the RV itself, insurance, maintenance (including fuel costs), and potential campground fees. It’s important to allocate funds for unexpected repairs and upgrades to ensure a smooth and enjoyable travel experience and avoid financial strain.

RV Loan Terms and Interest Rates

RV loan terms and interest rates play a crucial role in the affordability and financial planning of purchasing a recreational vehicle. Typically, loan terms for RVs range from five to 15 years, depending on the lender and the borrower’s creditworthiness.

Interest rates may vary widely based on credit score, down payment, and current market conditions. While some lenders offer fixed-rate loans, others may provide variable rates, each with its own advantages and considerations.

It’s important for buyers to thoroughly research and compare loan options to secure favorable terms and rates that align with their budget and long-term financial goals.

The Bottom Line

By carefully assessing loan terms, individuals could make informed decisions that fit their budget and contribute to a fulfilling and financially sustainable RV ownership experience. Additionally, consulting with financial advisors or RV loan specialists may provide invaluable insights and guidance throughout the financing process.




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