20 year loan for RV?

way2roll wrote:
Not sure why the interest question even comes into play. You can deduct the mortgage interest as a second home. Personally I'd rather use the banks money, amortize the debt, take the interest deduction and have my cash work for me. Recent events aside - I can earn a conservative 8-10% in the market or a 401 and net 5% or more difference over what I financed. I don't consider RV's as toys especially the Class A's I've owned, but you guys paying cash for your "toys" might do well to take an economics class. Paying cash for a depreciating asset is far worse than keeping your cash and putting it to work, using the bank's money, get the interest deduction and earn profit on the cash you still have. I get tired of the same 4 crusty mattress stuffers and your condescending remarks about not only who does what with their money, but reducing peoples love for Rv's to toys and advocating that financing is stupid. You are the ones who are missing the boat and could actually net money by financing. But go ahead, spend your cash on a depreciating asset. Get out of the 30's and start understanding how financing can actually be to your benefit. You have less cash and a depreciating asset. I have all my cash, plus net profit from the market by having that cash, and the RV. But I guess I'm a fool. Been in the banking industry for 25 years, not about to take financial advice from someone who pays cash for a depreciating asset. I think that falls under the list of "what not to do".

So you pay $1000 in interest to get $250 off your tax bill?

Buying on margin works great when the market is red hot. When it takes a dump, it's really painful.

Hey bid time. How is your stock portfolio doing?
Financing an Rv for 20 years is a bad idea no matter how you try to rationalize it.
Now is the wrong time to make any major purchase.

Fizz wrote:
Both sides present a good argument but it's times like this that will truly test the ones deeply in dept living pay to pay with no cushion.

That's a good point. In a worst case scenario, if I paid cash for my RV, I'd be without that windfall. But if I borrowed the money and kept my cash, and if I lost my job, I'd have that windfall.

I personally know a lot of people who have already lost their jobs due to this pandemic.

I would never advocate for defaulting a loan, but you can bet that personally if I was left with the decision of using my windfall to pay any loan or feeding my family, I think we would all make similar decisions. Most banks are being proactive and suspending collection efforts until this is over.

If you blew your cash on an rv, that RV isn't going to feed you.

It also hasn't escaped me that having an RV in times like these could be a real benefit in a lot of ways. We've used our MH for hurricane evacuations, power outages etc. IE - not a toy.

Both sides present a good argument but it's times like this that will truly test the ones deeply in dept living pay to pay with no cushion.

way2roll wrote:
Not sure why the interest question even comes into play. You can deduct the mortgage interest as a second home. Personally I'd rather use the banks money, amortize the debt, take the interest deduction and have my cash work for me. Recent events aside - I can earn a conservative 8-10% in the market or a 401 and net 5% or more difference over what I financed. I don't consider RV's as toys especially the Class A's I've owned, but you guys paying cash for your "toys" might do well to take an economics class. Paying cash for a depreciating asset is far worse than keeping your cash and putting it to work, using the bank's money, get the interest deduction and earn profit on the cash you still have. I get tired of the same 4 crusty mattress stuffers and your condescending remarks about not only who does what with their money, but reducing peoples love for Rv's to toys and advocating that financing is stupid. You are the ones who are missing the boat and could actually net money by financing. But go ahead, spend your cash on a depreciating asset. Get out of the 30's and start understanding how financing can actually be to your benefit. You have less cash and a depreciating asset. I have all my cash, plus net profit from the market by having that cash, and the RV. But I guess I'm a fool. Been in the banking industry for 25 years, not about to take financial advice from someone who pays cash for a depreciating asset. I think that falls under the list of "what not to do".

We need a "LIKE" button.

People need to learn the difference between investment spending and consumptive spending. There is nothing wrong with borrowing money to invest and make more than the cost of the loan. Borrowing money to buy a depreciating asset that is non-essential is as dumb as it gets, especially with a 20 year term. I would be reluctant to borrow money to buy an RV even it was a full-time residence. I would use the proceeds from my house to buy one for cash.

If you are trying to retire, you want to pay off your house mortgage, and not take on any additional debt.

Most people do not have the cash to buy houses, cars, Rv's, etc hence why lenders exist. Banks are in the business of making money, but they aren't loan sharks. The rates at which you can borrow money is pretty low. Do some people over leverage their debt? You bet. But some people use loans wisely to acquire what they want/need. In the example I stated before, if I have $100k, I can use that to purchase a Class A Rv in cash. I am left with a depreciating asset and $100k less in my reserves. Or I invest that money at a modest 10% return on investment and borrow the money for the RV at 5%. Now I still have my cash, I have my RV, and I am earning a net of 5% on my money. Granted not everyone does this, but it does illustrate that in this scenario, it's smarter for me to leverage the bank's money rather than my own.

Each person's financial decisions are their own and each person has reasons for why they do what they do. I am not sure most people consider their RV's toys. I know any of the Class A's I've owned were certainly not toys. The OP asked if 20 year loans exist, and yet there are a few on here that can't help themselves but to chime in that to finance an RV is stupid, and then further to reduce anyone's Rv to a toy. It's condescending, narrow minded and not real helpful. in fact the advice could be costly. It's certainly not mainstream. If RV loans didn't exist, neither would the RV industry - and the thousands of people that build them would not have jobs, and neither would the thousands of people in that supply chain. Without lenders the only people that would have RV's are the ones that could build them themselves, or pay to have one built.

If you feel better paying cash, great. If someone else doesn't, that's ok too.

Matt_Colie wrote:
Millenials and GenXers have it right. Only look at the cost per month and only pay that. If things go bad just go Chapter 7 or 13 bankruptcy. That is how they sell 1000$ telephones and 1E6$ RVs.

I can never again advise anyone to try to save for retirement. I had done this. No big toys and no great vacations for the last 28 years (after the kids moved out was our first chance), it all went into an account to make retirement comfortable.

Then came the abrogation. The regime decided that since they couldn't legally reward the labor organization that supported them well enough, they have to do something else. They did.

Until that time corporate bonds had been treated as real property, like I owned a piece of a building or a 1Kton stamping press. Even if the company was forced to liquidate, I would still get most of my money back. That is not what happened. They decided that they could buy out our (the plan's) interest for 5¢/$. Then they put rules in place that made the cost to recover that 5¢ to be 3¢$.

It was a little too late in my life for me to recover, so I have done the best I could with what I had left and lots of sweat.

Matt

While that is a horrible occurrence for you Matt, I love the value in your situation when it comes to how to "prepare" for retirement.

I am having similar issues currently (not near the magnitude you experienced) in that one of our investments in an employee owned company is appearing very shaky (nothing to do with the economy or the covid, just p!ss poor upper management).
While we are nowhere near physical retirement age, technically, we are much closer financially, but this snafu above could affect that in a 6 figure fashion, pretty easily. And the regulations surrounding it, are of no help to the investors (employees).

I'm working to mitigate that situation, but it does beg the questions...
What good is saving all your life just to lose it or have someone other than yourself benefit from it?
And would you rather enjoy your money earlier while you're younger and have the ability to enjoy it, or risk loosing it or getting dead earlier than planned, thus never reaping the fruits of your labor?

Not that we have scrimped and scrounged by any means, but sometime's life's situations (any or all of them) change one's priorities.


So bottom line, the rest of you can get off your financial high horses....

I have a post a few pages back that I stand by, but will add this loans are a tool and are like a pair of shoes not one size fits all. I agree with way2roll folks should enjoy there life but not live above there means. If you can make a payment without over exstending that's your choice. Some people don't have anyone they wish to leave there assets to so who cares if the bank takes it after your gone at least you enjoyed it for a period of time.

Ivylog wrote:

troubledwaters wrote:

Ivylog wrote:
OMB, a 20 year loan on a depreciating toy. Even at 4% you’ll pay more than double for it. A trailer at the end of 20 years might be worth 1/10th of what you paid for it. :S

And in the meantime while you saved up for that RV, the kids grew up and were gone before they got the chance to see the country. One size doesn't fit all. Nothing wrong with resposible debt.

“Responsible Debt” on a depreciating toy... now that’s stretch.

We bought (for cash) a used 8 year old Aurstream, one of the few trailers that will last more than 20 years, and pulled it all over the country for the next 10 years with a used burb. Sold the Airstreams for more than I paid for it because the new ones cost so much more. Our kids have been in almost all the states and probably 30 NPs.

Like I said above “ I apologize in advance as it’s probably not a good time to take on a older person who is limiting his outside exposure.

Doesn't sound like your Airstream was a toy.