Did I make a mistake in Financing? How long do you finance?

[yankeeslover]

oh boy....stupid me.... purchased my camper last summer... 2014 primetime rv... first camper ever... I didn't know any better... none of my family members nor friend camp or own campers so this was my wife and I sole decision...anyways, stupid me, not knowning any better financed this camper for 12 years... I didn't know any better.. spoke to my credit union for the financing and they told me most people finance these for 12-15 years..
I admit, I should have researched more, but I didn't... has anyone else made a big boo-boo like this? and no, I cant afford to double up on my monthly payments right now to pay off sooner... do these campers with proper care, generally last this long? I don't want a camper breaking down in two years with ten more years of payments...how bad are they to trade in? do they depreciate just like a car?
I know its all too late now and we cant change this, but im just wondering if anyone else has ever made a boo-boo like this and financed the camper this long? or am I the only poor sole...LOL

[phenrichs]

We financed for 12. We bought basically for our kids. Meaning we intentionally bought a bunkhouse so the kids would have a more enjoyable time camping. Our youngest daughter was only 2 at the time of purchase so we knew that it would be a keeper for that duration. We know that eventually we will get rid of it for something better for just the two of us. If we get to a point where we can make bigger payment we will but that doesn't mean we would get rid of it sooner.

[yankeeslover]

bravo bigdogger.... Last thing I want in life is to live in regret.. I don't want to look back 25 years from now and say "I wish I did this".... I think life is too short to regret and wish I did something..100 years from now, I don't think a sole on earth will give a darn wether I over spent or over extended myself..... this board was great,, I thank everyone for the insights...

[bigdogger]

The only pay cash crowd is speaking to those who have trouble exercising good judgement and control. No different than AA mantra of never taking a sip of alcohol or Gambler's Anonymous decreeing one should never make a bet. Most of us can have a glass of wine or take a trip to a casino and not spiral into the gutter. Same with credit, use it wisely and you can make your life better. There are even flaws in the old saw about always living below your means. When you wake up someday and find yourself physically unable to fullfill a dream will you be comforted by the fact you could have done it, it was within your means, but you didn't because you "lived below you means"? Often we regret what we could have done more than what we have done. Credit is a tool. Used wisely it can build great things, used poorly it causes damage.

[SpoiledRotten]

M GO BLUE wrote:
Take your payment and divide it by 12...then add this amount to your payment every month

Just make sure to tell them to apply it to your principal only or they will apply it as principal and interest, and it won't go as far.

[v10superduty]

Ivylog wrote:

v10superduty wrote:

sherpaxc wrote:
I made the same mistake with a truck. Impulse buy and I was upside down. I ended up selling it, cutting my loses, paying off what I owed and calling it a lesson learned. I then saved up and bought a pop up camper for 5k.

Please don't expect to pay 15 years on that thing. It's not worth it. Everyone makes mistakes, but your's can be fixed. Cut your losses and sell it.

So this guy who obviously wants to go camping has a brand new camper in his yard at a payment he can afford. He is going to pay a whack of interest if he doesn't re-fi lower or make some extra payments BUT he has a camper he can afford..

He is badly upside down and your "advice" is to sell it now at a loss, still owe probably quite a lot, don't get to go camping but keep making payments on something you don't have? :h

Sorry, but I can't agree and doubt he will take this advice..

Sorry, but I can't agree and he needs to take sherpaxc's advice. For you finicial genuis 15 years at 10% equals to paying for it 2 times... OP Taking your monthly payment and X 12 and X 15 and I come up with $40,500. How much did it cost and how much did you put down? Campaign tastes on a beer pocket book. Cut your loses while it's still fairly new, borrow what it takes to pay off the difference, get a 2nd job and buy something you can afford at %4 for seven years so you are only paying 125%, not 200%. The only way to really get ahead is to live below your means which really means paying cash BUT that's too late.

So someone ho has been RVing since 1972 (which would make you a senior like most of us here) is telling someone who is obviously young and didn't understand the situation he got into, to give up his dream of camping, take a immediate financial hit of probably $10,000, pay on that and sit home and wish he was camping..
Hmm..
Don't think that's advice many in his situation would follow.

No disrespect meant here but, good golly, you are a mature business owner.. entirely different financial situation than the OP.
Quit lecturing and let them go camping.

He said he can handle the payments he is committed to, he now understands how to save a lot of the interest costs with extra payments.
He KNOWS what he did was not GOOD but said is prepared to live with it.
We have ALL been there once.

[dadmomh]

Totally DISagree with selling it and cutting your losses. You obviously love your trailer and camping. You have a trailer and can get out however often. Suggest you take a deep breath, plan some close-by trips....those cost less than longer jaunts. While you're enjoying your life in the great outdoors, also do some investigating at local banks and credit unions for what they might offer.

Agree that paying cash is the best, but not all of us can or choose to for whatever reason. Actually appears a bit pompous on the part of some who are not helping with the OP at all, but delivering a financial lecture. Truly, none of their business....the OP was asking for some support and suggestions.

As new as your trailer is, I would think you should be able to get close to a new-unit interest rate. Just check on a regular basis and when the time is right and you can make the change, then jump. Meanwhile, don't beat yourself up. Imagine we've all made purchases we've second-guessed. CAMP! ENJOY! WATCH FOR A BETTER DEAL!

[Reader1]

As usual, this has gone from the OP asking a financial question to a philosophical discussion. That is OK with me, but...anyway, Yankeeslover - I am happy that you got some information here that eased your mind. Enjoy the amazing trips, adventures and memories you will have with your family. THOSE ARE PRICELESS!!

[cantfindusernam]

beemerphile1 wrote:

zackyboy3rs wrote:
Bottom line is this, if you have small kids NOW is the time to have a camper to enjoy it with them. To me this is more important than $ as long as you can cover the basics of living. I am not perfect and probably can do better with our finances but I have maybe 4 years til all kids are out of the house and I want to enjoy it....

I agree, sort of. Making memories with family is a fantastic use of an RV. However, great memories can be made in a $1,000 RV just as well as a $40,000 RV.

Lots of seasonal campgrounds have cheap RVs sitting there for sale and ready to use. The OP could take the hit now, get out from under a 15 year sentence and buy a cheap unit. All RV debt could be paid within one year and finances could then be used on other debt. It wouldn't change the camping experience at all for the family.

I agree with both of you. All depends on what a person wants and can affords. Most important is the memories no matter if you are in a tent or camper or whatever.

[TOOBOLD]

ddschuman wrote:
I am going to chime in here one last time. What works for one or makes sense to one does not always work or make sense to another. I, myself, paid cash for a TT but wanted a FW with higher ceiling and more space for comfort. I can afford my payments and will pay it off in less than 1/2 the time I have it financed. It makes sense to me because I have a unit that is comfortable and I enjoy my time using it. I camp because I love to go places but prefer my own accommodations over a hotel. Plus, I can take my two little dogs with me without worry...they travel well by the way and go everywhere with us. Our children are grown. I could have waited a few years and paid cash and according to some on here, that would be the proper thing to do but you know what? I enjoy it now and am making memories now. There is nothing wrong with that. My dad died at the age of 60. His mom, my grandmother, died at the age of 59. One grandfather (mom's dad) died at age 37 and my other grandfather (dad's dad) died at age 57. All were due to cancer or heart attack. To my knowledge, I am healthy but longevity certainly does not run on either side of my family. For this reason, I choose to enjoy doing things that I want to do as I may not have the opportunity later. My father-in-law died of cancer and my mother-in-law of Alzheimer's. Both of them in their 60's. I am 44 and DH is 50. My outlook on life is probably different than most. We own a successful yet small business in a small town and we do have a financial plan which does include being debt free before retirement (when DH is age 65)... if we live that long.

My point to this post is that I see no reason to wait till tomorrow to do something that can be done today if it is within your means to do so. If my payments stretched me to the point that I was worried about being able to pay my other bills or where my next meal was coming from, I may feel differently but thankfully, I do not have any of those worries.

To the OP, don't feel bad about financing...enjoy your camping. If you are able, I would suggest looking for cheaper interest on a refinance but only because that would save you money. Do what makes sense to you...it is your money that you are spending.

I'm with you. Last year my father and mother in law died within 6 weeks of each other. Life is too short and right now we are going to live and make lasting memories with our children because tomorrow is not promised.

Yeah, we have debt but I can pay it and I live below my means. I have a loan on my trailer with a 4% interest rate. I could have paid it cash, but would have meant less money in other investments. Last year alone my 401K earned 23% for the year.

I also use my credit card for every purchase conceivable. If I could pay my mortgage by credit card I would. I have saved my miles for over a year and a half for a total over $2100 and my family of four will be flying to Jamaica for about $200 this summer. To the OP if you have a credit card who offers miles you could also do this method and you can cash in your miles and use the money for a principle payment. The catch is you HAVE to pay it off at the end of the month and not accrue any interest.

Have fun enjoy your trailer and your family.

[beemerphile1]

zackyboy3rs wrote:
Bottom line is this, if you have small kids NOW is the time to have a camper to enjoy it with them. To me this is more important than $ as long as you can cover the basics of living. I am not perfect and probably can do better with our finances but I have maybe 4 years til all kids are out of the house and I want to enjoy it....

I agree, sort of. Making memories with family is a fantastic use of an RV. However, great memories can be made in a $1,000 RV just as well as a $40,000 RV.

Lots of seasonal campgrounds have cheap RVs sitting there for sale and ready to use. The OP could take the hit now, get out from under a 15 year sentence and buy a cheap unit. All RV debt could be paid within one year and finances could then be used on other debt. It wouldn't change the camping experience at all for the family.

[ddschuman]

I am going to chime in here one last time. What works for one or makes sense to one does not always work or make sense to another. I, myself, paid cash for a TT but wanted a FW with higher ceiling and more space for comfort. I can afford my payments and will pay it off in less than 1/2 the time I have it financed. It makes sense to me because I have a unit that is comfortable and I enjoy my time using it. I camp because I love to go places but prefer my own accommodations over a hotel. Plus, I can take my two little dogs with me without worry...they travel well by the way and go everywhere with us. Our children are grown. I could have waited a few years and paid cash and according to some on here, that would be the proper thing to do but you know what? I enjoy it now and am making memories now. There is nothing wrong with that. My dad died at the age of 60. His mom, my grandmother, died at the age of 59. One grandfather (mom's dad) died at age 37 and my other grandfather (dad's dad) died at age 57. All were due to cancer or heart attack. To my knowledge, I am healthy but longevity certainly does not run on either side of my family. For this reason, I choose to enjoy doing things that I want to do as I may not have the opportunity later. My father-in-law died of cancer and my mother-in-law of Alzheimer's. Both of them in their 60's. I am 44 and DH is 50. My outlook on life is probably different than most. We own a successful yet small business in a small town and we do have a financial plan which does include being debt free before retirement (when DH is age 65)... if we live that long.

My point to this post is that I see no reason to wait till tomorrow to do something that can be done today if it is within your means to do so. If my payments stretched me to the point that I was worried about being able to pay my other bills or where my next meal was coming from, I may feel differently but thankfully, I do not have any of those worries.

To the OP, don't feel bad about financing...enjoy your camping. If you are able, I would suggest looking for cheaper interest on a refinance but only because that would save you money. Do what makes sense to you...it is your money that you are spending.

[joeshmoe]

Gdetrailer wrote:
Folks often just don’t understand, care or want to know where the money goes…

Man, oh man, is that the truth. DW couldn't care less much less, tracking where it goes. If not for me "complaining" and "constantly looking over her shoulder" as she likes to say, about all the waste, I'm pretty sure we'd end up with nothing at the end of the month.
:S

Anyway, there's my contribution...which, as usual, is nothing.

[westend]

The die is cast so we can only help by making the outcome better. Ranting about the state of affairs of the US and it's spending habits, raising chickens for food, or seeking a second job to be "just like me", isn't helping.

What I would do is screw down a small metal letter box with a hasp for lock in a storage compartment. Every time you use the RV or as budget allows, toss a $20 in there. You could either access the money monthly, wait for an accumulation, or save the whole for repairs and maintenance. I would definitely try to chip at the principal of the loan as that will reap huge benefits.

Good luck with your new rig and have some fun with it.

[Cotay]

NanciL wrote:
I can only say that yes you made a mistake.
He who cannot afford to pay cash should not finance a travel trailer or anything else accept a house or vehicle.
You'll never get out from under
Tent until you can afford to pay cash, and you'll enjoy that trailer much more

Jack L

Hello Jack, your exceptions to the “no financing” rule are in connection with the purchase of a house or vehicle. What makes those two exceptions acceptable? Oddly, a travel trailer is actually both of those things if you think about it. If the TT were somebody’s primary residence would you then think that financing it is acceptable? Would you object to someone taking out student loans?

My point is this, financing a purchase can make sense for people in many unique circumstances. It really is up to (and the responsibility of) the individual to understand what is advisable, and if they cannot make that determination then they should consult with a financial advisor for guidance. Credit is a tool. Credit isn’t inherently evil. Rather the propensity to abuse credit is the root of the problem for many.

Credit has many legitimate and valuable uses such as limiting the need to tie up liquidity. Furthermore, if your assets outnumber your debt load, then debt can be a powerful tool. For me, my personal goal is to never exceed a 25% debt/asset ratio....a business can go much higher. That way you can rest assured that you won't lose your shirt if your financial circumstances change.

[Rob_Mitch]

OP, if you can refinance to 5% then add $60 per month that would keep the payment at approx. the SAME $225 per month. that would cut five years off the loan and reduce the amount of total interest paid from near $20,000 to about $5,600.
For some others here, I am fortunate, I have done without and saved all my life. I now can pay cash. I detest being in debt. As for as "finicial genius" I like most of us, wasn't born with that knowledge, It had to be learned on my own because it wasn't taught in school. I will attempt to give the best advise I can, and not rag on someone trying to learn and be responsible.