I'm planning to buy a new RV in March. Yes, I know they depreciate like crazy, but I've window shopped the used market and I don't see any that's what I want at a reasonable price and I don't want to get into the used RV inspection dance, either. I have the cash, but my plan has been to finance initially and then pay off the loan in a month or two. Interest would not be tax deductible for me and I don't think I'll get a 29% return in the market again next year. So I don't want to keep the loan.The reason I want to get a loan to start with, is because I like the idea that a bank or some other business has "skin in the game" with me. What I mean by that is "How do I know if I give the dealer my cash for the RV they will actually deliver the RV? I don't have much trust for any RV dealer and I don't know what paperwork to look for. A company in the business of putting their money out to finance these purchases almost certainly knows what to look for.So what are your opinions/suggestions about a plan like this? I know I will loose a little money by doing a loan, but I consider that to be like title insurance if I was buying a home. It's something I'm willing to pay for. And as a related question, What are typical prepayment penalties or terms on RV loans?

The only one with skin in the game after the loan if funded is you. There are reasons to finance but I would not use the bank aiding you in the transaction as one of them.

I would first talk to the bank. We have some bankers on this site might give you good advice. If the bank loans you the money, I would expect a hefty pre-payment penalty. They don't like to go to all that work for nothing. I would just go to a well established dealer, make a deal on the rig. Tell them that's the out the door price so they on't stack fee's on top.Buy it off the lot is what I mean. Then come back with a cashiers check and you'll have your RV. If it's a long standing reputable dealer, there shouldn't be a problem.

you select an RV from the dealer’s lot or place an order for the factory and put down a modest deposit ( not in cash!), making it refundable if, upon delivery, there is something major wrong. the deposit amount will be noted on the sales agreement. upon delivery you do an inspection and then pay the balance. not in cash, check, bank check, etc. get a receipt or make sure your payment is noted on the sales agreement. you pay, dealer hands you the keys. the bank will not get involved in this process.

T18skyguy wrote:I would first talk to the bank. We have some bankers on this site might give you good advice. If the bank loans you the money, I would expect a hefty pre-payment penalty. They don't like to go to all that work for nothing. I would just go to a well established dealer, make a deal on the rig. Tell them that's the out the door price so they on't stack fee's on top.Buy it off the lot is what I mean. Then come back with a cashiers check and you'll have your RV. If it's a long standing reputable dealer, there shouldn't be a problem."Shouldn't" I agree. I shouldn't have a problem. In the unlikely event that I give them $30,000, $40,000, or more, and oops, they file bankruptcy or decide to take early retirement with my funds, who here will reimburse me? It suddenly got quiet.Maybe what I need to do is investigate some kind of escrow agent (a bank or lawyer) and I pay that fee to have my peace of mind.

DallasSteve wrote:T18skyguy wrote:I would first talk to the bank. We have some bankers on this site might give you good advice. If the bank loans you the money, I would expect a hefty pre-payment penalty. They don't like to go to all that work for nothing. I would just go to a well established dealer, make a deal on the rig. Tell them that's the out the door price so they on't stack fee's on top.Buy it off the lot is what I mean. Then come back with a cashiers check and you'll have your RV. If it's a long standing reputable dealer, there shouldn't be a problem."Shouldn't" I agree. I shouldn't have a problem. In the unlikely event that I give them $30,000, $40,000, or more, and oops, they file bankruptcy or decide to take early retirement with my funds, who here will reimburse me? It suddenly got quiet.Maybe what I need to do is investigate some kind of escrow agent (a bank or lawyer) and I pay that fee to have my peace of mind.In what scenario would you hand over $30-40k or something other than a deposit without driving off the lot concurrently to the transaction?

Cash Vs. Finance | Good Sam Community

ppine
Explorer II
Mar 19, 2020
Now is not that the time for signing up for non-essential debt.
Put your plans on hold and re-think the idea in about 18 months.
C_Schomer
Explorer
Mar 19, 2020
I would never buy a new rv... they depreciate about like a used diaper! Pay cash for a use one, as long as you can, or have, a good inspection done. I've done very well, that way. Don't pay the NADA valuation either. I've always done several thousand better. Craig
ppine
Explorer II
Mar 12, 2020
Buying a new RV and financing it is pure consumption spending. Much better to buy a used one for cash. For serious expenditures and financing I like investment spending. That is how I got retired at age 50 which was 20 years ago.
time2roll
Nomad
Jan 12, 2020
GDS-3950BH wrote:
Why not blame the company that hosts this board? They'll be more than happy to sell anyone a $20K POS stick and tin TT that will be lucky to last 5 years, and finance it for 10 or 12 years for them.
My stick and tin is doing just fine 15 years running. Much better than all that delam that gets posted. I went with 20 year financing, paid in 5. NO regrets.
rvshrinker
Explorer III
Jan 12, 2020
Did PDI, wrote check, drove home. No escrow needed.
GDS-3950BH
Explorer
Jan 06, 2020
Grit dog wrote:
GDS-3950BH wrote:
If it gets that bad and you financed an RV just dont make the payment and they'll come and get it, which is why it's called collateral. Any depreciation or difference will be written off as a profit and loss write off as you can not get blood from a turnip. At that point your FICO score won't mean much anyway, and as soon as it's over they'll be glad to finance another for you regardless.

I'll hope this part was written tongue in cheek and just not presented as such.
If not, I'd like to personally thank you for promoting the major reason I lost over $100k on a house that I chose to be responsible with and hang onto during the last recession rather than just stop paying, toss the keys under the mat and wait for the bank to foreclose on it.

(At least 2 other families that did just that with their mortgaged homes paid "some" of the rent to live in mine and offset my loss, somewhat. They got a more personal thank you, as about half my loss was not in market value, but rather unpaid rent and damage to the house because they were scum bags too...)

At the same time, I'd like to also thank those with irresponsible debt for allowing us to buy a new boat, new truck and a 1/4 section of land, all at significant discounts because the owners couldn't make their payments on their luxury items that were leveraged 100% or more.

It was all tongue and cheek. You would not believe the amount of people I know (not by choice) who live by the tactic. It became a little harder back whenever they changed the bankruptcy code which seems like eons ago, but that just slows em down a little.

Why not blame the company that hosts this board? They'll be more than happy to sell anyone a $20K POS stick and tin TT that will be lucky to last 5 years, and finance it for 10 or 12 years for them.
Grit_dog
Navigator
Jan 06, 2020
GDS-3950BH wrote:
If it gets that bad and you financed an RV just dont make the payment and they'll come and get it, which is why it's called collateral. Any depreciation or difference will be written off as a profit and loss write off as you can not get blood from a turnip. At that point your FICO score won't mean much anyway, and as soon as it's over they'll be glad to finance another for you regardless.

I'll hope this part was written tongue in cheek and just not presented as such.
If not, I'd like to personally thank you for promoting the major reason I lost over $100k on a house that I chose to be responsible with and hang onto during the last recession rather than just stop paying, toss the keys under the mat and wait for the bank to foreclose on it.

(At least 2 other families that did just that with their mortgaged homes paid "some" of the rent to live in mine and offset my loss, somewhat. They got a more personal thank you, as about half my loss was not in market value, but rather unpaid rent and damage to the house because they were scum bags too...)

At the same time, I'd like to also thank those with irresponsible debt for allowing us to buy a new boat, new truck and a 1/4 section of land, all at significant discounts because the owners couldn't make their payments on their luxury items that were leveraged 100% or more.
Grit_dog
Navigator
Jan 06, 2020
time2roll wrote:
When I bought my RV trailer I had just paid cash for my house. Dang I was out of money and had to finance the trailer. Armageddon was upon me.

Lol. Yes, there's responsible debt and irresponsible debt for sure and too many get caught up in irresponsible debt and a few too many preach NO debt.
As with anything, it's subjective and good for you, sounds very responsible.
Bobbo
Explorer II
Jan 06, 2020
To repeat myself: Do what you are comfortable doing. I pray that you don't learn a hard lesson.

The voice of caution is never welcome when things are going well. Good luck.
bid_time
Nomad II
Jan 06, 2020
Bobbo wrote:
For all of those who think it is a good idea to carry debt that you don't need to carry, I hope you never live through a 5+ year recession. I have. I won't carry debt unless it is necessary.

As far as selling your "collateral," good luck with that when the recession hits and no one has any money. As far as withdrawing your savings from your investments when the recession hits, good luck with that when your savings are suddenly 50% of what they were.

Do what you are comfortable doing. I pray that you don't learn a hard lesson.
Bobbo - Why would I wait 5 years to cash out and cover my loans?

If the market dropped 10% over a month, I can cash out, cover my loans, and still be thousands $$$ ahead.

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