3 Best Ways to Finance a New RV or Motor Home

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.

RV Financing
Logo

We’ve got your back! Student Loan Hero is a completely free website 100% focused on helping student loan borrowers get the answers they need. Read more

How do we make money? It’s actually pretty simple. If you choose to check out and become a customer of any of the loan providers featured on our site, we get compensated for sending you their way. This helps pay for our amazing staff of writers (many of which are paying back student loans of their own!).

Bottom line: We’re here for you. So please learn all you can, email us with any questions, and feel free to visit or not visit any of the loan providers on our site. Read less

Do you dream of taking off on the open road, visiting national parks and landmarks across the country? You’re not alone. According to the Recreational Vehicle Industry Association (RVIA), more than 9 million households own a recreational vehicle (RV) or motor home.

However, an RV can be more expensive than some houses. RVIA reports that a modest camping trailer can cost $22,000, while a motor home can cost as much as $500,000. Since few people have that much cash, they turn to motor home loans and other RV financing options.

But before you head to the dealership, make sure you know what to expect.

Types of RVs and motor homes

How much you spend on an RV depends on its use. If you plan to use it for occasional weekend trips, you can purchase something smaller and cheaper. However, if you plan to make it your primary living space, you’ll probably need to spend more so it meets your needs.

According to Kampgrounds of America, there are four main types of RVs and motor homes:

  • Travel trailers: Unlike most other RVs, trailers must be towed by another vehicle. They’re smaller than other options but also cheaper.
  • Class C: Class C campers have a cab that extends over the cockpit. Generally roomier and more comfortable than trailers, Class C campers cost between $50,000 and $100,000.
  • Class B: Class B vehicles are about as long as the average van, so they’re easier to drive than other models. They usually cost between $40,000 and $80,000.
  • Class A: For those who want more convenience, features, and comfort, Class A vehicles are perfect. They offer more space, but you’ll have to spend a lot of money to own one. They can cost $500,000 or more.

Motor home loans and RV financing options

If you’ve decided that owning an RV is right for you but don’t have the money in the bank, here are three financing options to consider.

1. Dealership financing

Like car dealerships, most RV and motor home dealerships offer on-site financing. Depending on your credit and the type of vehicle you’re purchasing, you could qualify for a rate as low as 4.99%. In most cases, you can choose a loan term as long as 20 years. However, opting for a shorter term often results in a lower rate.

2. Bank or credit union loans for RVs

You might be able to get a better deal from a credit union or bank than you would at a dealership. However, you can’t just apply for a car loan. Instead, you’ll have to apply for a recreational loan or specialty loan. Because RVs and motor homes are luxury vehicles, the lending criteria tend to be stricter than they are for a typical car loan.

If you have good credit and a stable income, you could qualify for a loan with an interest rate as low as 3.99% and a repayment term of up to 20 years.

3. Personal loans

If your credit or income isn’t good enough to qualify for dealership or recreational loans, applying for a personal loan is another option. Personal loans are offered by banks and other financial institutions. Some lenders will work with borrowers with credit scores as low as 580, so you might be more likely to get approved for a personal loan than other forms of financing.

As you decide whether a personal loan is right for you, it’s important to know the downsides. There are limits to how much you can borrow. Most lenders have a maximum of $100,000 or less, which might not be enough to cover your RV purchase. In addition, the repayment terms tend to be much shorter than they are for other loans. You might have only five years to repay the loan.

Finally, the biggest drawback to personal loans is the interest rates. If your credit is less than stellar, you might not qualify for a low-interest personal loan. Instead, lenders might offer you loans with interest rates as high as 35.99%.

For example, if you bought a $50,000 RV and qualified for a 3.99% loan from a credit union with a five-year repayment term, you’d pay $5,236 in interest. If you instead took out a personal loan for $50,000 and qualified for a five-year loan with a 20.00% interest rate, you’d pay $29,482 in interest charges alone.

If you decide to take out a loan, compare offers from multiple personal loan lenders to ensure you get the best rates.

Other costs of owning an RV

Besides the cost of financing an RV, there are other expenses you’ll need to remember. In addition to the purchase price and interest fees, you’ll have to account for sales tax. Depending on the sales tax rate in your state, taxes could add thousands to the RV’s cost.

Gasoline is also a major expense. Some RVs and motor homes get just a few miles per gallon, so you’ll spend a lot of time and money at the pump. You’ll also need to budget for regular maintenance, tires, and insurance.

Deciding to buy an RV

Buying an RV or motor home is an enormous expense. If you don’t have that money saved in the bank, you’re risking thousands. Even with RV financing options, interest rates and other fees will cause your balance to balloon. If you still dream of hitting the open road, consider renting a vehicle or start saving to pursue your goal.

Interested in a personal loan?

Here are the top personal loan lenders of 2018!
LenderRates (APR)Loan Amount 
1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

  1. Personal LoansFixed rates from 6.58% APR to 14.87% APR (with AutoPay). Variable rates from 6.275% APR to 12.575% APR (with AutoPay). SoFi rate ranges are current as of July 16, 2018 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. See APR examples and terms. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 6.275% APR assumes current 1-month LIBOR rate of 2.10% plus 4.175% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.
  2. Terms and Conditions Apply: SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)

2 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  • Personal Loan Rate DisclosureFixed interest rates from 6.49% – 19.49% (6.49% – 19.49% APR) based on applicable terms. Lowest rates range from 5.99%-18.99% (5.99%-18.99% APR), are for eligible applicants, require a 3-year repayment term, and include our Loyalty and Automatic Payment Discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
  1. Loyalty Discount: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with us at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  2. Automatic Payment Discount: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their Citizens Bank Personal Loan during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account two or more times within any 12-month period, the borrower will no longer be eligible for this discount.

* Important Disclosures for Upgrade Bank.

Upgrade Bank Disclosures

  • Personal Loan Rate DisclosureFixed interest rates from 6.49% – 19.49% (6.49% – 19.49% APR) based on applicable terms. Lowest rates range from 5.99%-18.99% (5.99%-18.99% APR), are for eligible applicants, require a 3-year repayment term, and include our Loyalty and Automatic Payment Discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
  1. Loyalty Discount: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with us at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  2. Automatic Payment Discount: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their Citizens Bank Personal Loan during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account two or more times within any 12-month period, the borrower will no longer be eligible for this discount.
7.73% – 29.99%$1,000 - $50,000
Check rate nowon SLH's secure site
6.28% – 14.87%1$5,000 - $100,000
Check rate nowon SLH's secure site
6.87% – 35.97%*$1,000 - $50,000Visit Upgrade
8.00% – 25.00%$5,000 - $35,000
Check rate nowon SLH's secure site
4.99% – 29.99%$10,000 - $35,000Visit FreedomPlus
5.99% – 18.99%2$5,000 - $50,000Visit Citizens
15.49% – 34.49%$2,000 - $25,000Visit LendingPoint
5.99% – 35.89%$1,000 - $40,000Visit LendingClub
5.49% – 18.24%$5,000 - $75,000Visit Earnest
9.95% – 35.99%$2,000 - $35,000Visit Avant
Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.