How to get a loan for RV
Looking at all the forums, none are a perfect fit so will ask here, my apologies if not the best sub-forum. Trying to figure out how much I can get in a loan. I need some help with loan basics as ...
Forum Discussion
spoon059 wrote:
Do you own a house? We took out a HELOC at a very low rate and used that to buy our trailer. Paid it off in less than 3 years. Rates are so stinking low right now for mortgages it's even more beneficial than it was 6 years ago when we did it.
Home equity line of credit is a great tool when rates are low to buy things like RV's.
A few things to keep in mind. Lenders usually won't ever let you borrow more than 80% of the value of your home. So a HELOC's amount is determined by an appraisal. The amount of the appraisal x 80% (minus the amount of outstanding debt in your current mortgage) = the amount available to borrow. Example: if your house appraises at $200k, 80% is $160k - this is the total amount of debt you can have against your home. If you owe $100k on a mortgage, then the maximum amount left for a HELOC is $60k.
The other thing to note, is that a HELOC is essentially a second mortgage in addition to your first mortgage and must be paid off if you ever sell your home. Using the scenario above, if you sold your home for $200k, you walk away with $40k - not $100k. (actually by the time you pay the realtor and associated fees - your net would probably be more like $20-25k)
Some of this might be old news to a lot of you, but I talk to a lot of people who don't even know what a HELOC is let alone the implications of getting one.
