RV Financing: A Guide
If you’re thinking about purchasing your first RV or upgrading your current model, choosing to finance your purchase might be a wise decision. When you finance, you don’t need to pay the entire cost upfront, which allows you to enjoy your RV for years before it’s entirely paid off. So, how can you choose a responsible financing plan?
Set a Budget
Before you begin to browse for an RV, it’s important to set a realistic budget. Setting a budget can help you narrow down options and help you to find a model that works for you and your family, without breaking the bank. Additionally, knowing your budget can help you prioritize features that you want to add to the RV, and will allow you to purchase the best model available in your price range.
Check Your Credit Score
Before applying for an RV loan, it is crucial to check your credit score. Your credit score plays a significant role in determining your loan eligibility and the interest rates offered by lenders. When you have a good credit score, typically 700 or higher, you are more likely to qualify for a lower interest rate and better loan terms. The higher your credit score, the better your loan application will look to a potential lender.
Having a good credit score opens up more financing opportunities and potentially saves you thousands of dollars in interest over the life of your loan. On the other hand, a lower credit score may result in higher interest rates or even loan denial, making it essential to work on improving your credit before applying for financing.
Make a Down Payment
Most RV financing options require an upfront down payment of 10% to 20% of your RV's total cost. A larger down payment can help you qualify for a better APR (annual percentage rate) on your loan. Lenders see a larger down payment as a sign of financial stability and are more willing to offer competitive interest rates. This can significantly reduce the overall cost of the loan. So, save up your money for the down payment, and enjoy those lower interest rates.
Are you ready to start financing your new RV? Then make sure to visit the team at Zabukovic Motors Inc. in Pueblo or Colorado Springs, CO. We proudly serve those in the Cheyenne Mountain region and Colorado City, CO.