How to get a loan for RV

Sorry for the ramble but here goes:

Debt load - the sum of all the money you currently owe - is used to calculate your income to debt ratio. The sum of your total income from all sources divided by debt load = your income to debt ratio. Lenders usually like to see an income to debt ratio lower than 40%. Other factors come into play that add to a lender's risk of lending. FICO is one. The lower your FICO the greater the risk to the lender. This will result in a higher rate. When buying RV's it gets a little trickier as RV's are a heavily depreciating asset. Most lenders won't finance anything older than 10 years - and the older the RV, the higher the rate. This offsets the loss in value in their securitized asset - the RV. In other words, the older the RV the less it's worth and they can't get all their money back if they have to seize and sell. So they offset that risk of loss by charging higher interest and greater down payment from you.

Get your FICO score. Any of the credit scoring agencies (Equifax, Trans Union etc) will offer one for free per year. Calculate your income to debt ratio - how much can you reasonably afford?

Banks aren't in the habit of willy nilly telling you how much buying power you have. That's because it's heavily dependent on the exact thing you want to buy and it's value. Example - you might be able to buy a $200k house, but only a $20k RV. The amortization as well as the value of the asset secured against the loan is very different. If you find an RV you like and you think you can afford, approach the bank and ask for a "soft pull" for approval. They can tell you with limited information if they think you'll qualify without impacting your credit scores. Most banks do this now as common practice.

Lending is HIGHLY regulated and there are processes the banks have to follow to provide you with accurate information and they can't do that without actually following a due process. Several laws in place protect the consumer from false and misleading lending practices - this means they can't say "we think you might be able to buy that". They have to provide factual information based on real values from you, about you, your income and the asset you are buying. It's a pain I know, but those laws and practices are in place to protect you.

we bought ours about three years ago. I shopped around and Good Sam had the best rates.

They required one of their licensed inspectors inspect the RV before they'd write the loan.

Once we knew the loan was approved, we went ahead and pulled from our HELOC to essentially pay cash for the RV. Then used Good Sam to repay most of the HELOC.

You don't have a high enuf credit rating to buy where I work, which is pretty much how it is industry wide.

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.

Wise words, mich.

et cetera wrote:
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 I've never gotten one before.
And how much I get will drive my purchase decision, alternating between B-class and C-class. I full-timed in a 32' TT before but it was bought with cash. Anyway, that's immaterial.


I have no debt, no bankruptcies, my credit history is this: TransUnion is 705, Equifax is 630 via CreditKarma. I don't have the FICO score. I am hoping to get at least 40K but where do I go, my bank or maybe Navy Federal Credit Union, or what?

Do yourself a favor and get your real fico scores so you have a general idea what tier you would be in for a loan. Credit Karma scores are worthless for anything other than entertainment.

Then it generally comes down to debt to income ratios the lender uses.

Credit unions will usually have the best rates. New RVs are pretty easy to finance, but used ones can be much harder to finance (RV loans usually have an age restriction). If buying used, you may have to get a personal loan or equity loan.

With all that, really think about financing an RV. It's rarely a good move as the RV depreciates and you'll be underwater for most of the loan life.

I would try your credit union first,
But understand, each time a creditor runs your credit, your score will drop.
Another option may be USAA since you mention a military credit union.

Based on the amount you want to borrow, it appears you'll be buying used. Lenders will typically lend on newer RVs and charge a higher interest rate, compared to new. Your best bet will be to check with your credit union.

Start with your local credit union. Try your bank if you have dealt with them for a while. If buying from a dealer, have them carry the ball on this issue.