Key takeaways
- You can get an RV loan from banks, credit unions, online lenders and at some RV-specific dealerships.
- To qualify for an RV loan, you’ll need to satisfy certain credit score, income and credit history requirements, in addition to lender-specific requirements.
- To improve your chances of approval, make sure your finances are in order and research lenders to find options that cater to your situation.
Recreational vehicles — or RVs — can cost anywhere from under $10,000 to over $500,000, depending on the class, model and condition.
RV loans can be a great way to finance such a large purchase. These loans are typically available through online lenders, banks, credit unions and RV dealerships.
The RV loan application process is similar to applying for an auto loan, but getting approved is often harder. That’s because lenders tend to have stricter requirements for these types of loans, given their large amounts.
How to get an RV loan
Getting an RV loan is fairly similar to getting any other type of loan. To maximize your chances of approval, follow these steps before applying:
- Check your credit score. 660 is typically the lowest score lenders will accept. If your score is lower than that, try improving it before submitting a loan application.
- Identify the type of RV you want to purchase. This is important because it will determine how much you’ll need to borrow. Likewise, its condition (new or used) will help you choose the best financing option.
- Secure the funds for your down payment. Though not required by all lenders, this is typically 10 to 20 percent of the RV’s purchase price.
- Compare lenders. Look at eligibility requirements, interest rates and repayment terms to come up with a list of viable financing options.
Prequalify with multiple lenders
Before submitting a full application, get quotes from the lenders you’ve researched. This process, known as prequalification, will not hurt your credit and is crucial for determining your purchasing power before you shop.
If you are purchasing from a dealer, look for one that works with multiple lenders, as you have better chances of getting matched with a competitive offer that caters to you.
Complete an application
Once you’ve settled on the lender you hope to work with, complete and submit your full application. Although this may vary from one lender to the next, you’ll likely be asked to provide the following:
- Your full name and date of birth.
- Proof of identity, such as a passport or another official ID.
- Your address and phone number.
- Proof of address, such as a utility bill, an insurance contract or a lease agreement.
- Your Social Security number.
- Your employer’s contact information.
- Proof of income, such as copies of tax returns, pay stubs or W-2s.
Sign the loan agreement
Once you’ve found the RV you want to purchase and have been approved for the loan, sign the loan agreement, which outlines the loan terms, including your payment amount and due date. Depending on the lender, the funds may be deposited into your account as soon as the next day.
Getting approved for an RV loan: Factors to consider
Because RVs are often classified as luxury items and involve borrowing a significant amount of money, the qualifications for RV loans tend to be stringent, often mirroring those of qualifying for a mortgage.
Credit score
As with applying for any type of consumer borrowing, a solid FICO credit score is an important part of your qualifications. Lenders use credit scores to gauge your level of credit risk or likelihood of repaying the loan.
Most lenders require a FICO score upwards of 660 to qualify for an RV loan. However, some will allow FICO scores below that threshold. That said, to secure the lowest rates, you’ll need a credit score in the mid-700s or higher. Otherwise, you could end up with a hefty interest rate.
Before starting your application, check your credit reports with all three credit bureaus — Experian, Equifax and TransUnion — so that you know your score in advance. That way, you can take any steps needed to improve it. A free copy of your credit report from all three bureaus is available once every 12 months from AnnualCreditReport.com.
Can I get an RV loan with bad credit?
It’s possible to qualify for an RV loan with a lower credit score. However, lenders typically accept applicants with a score close to 700 to get approved for the loan.
Some lenders may still approve loans for buyers with a credit score as low as 600, but this typically comes with higher interest rates and fees. Make sure you shop around to find the best offer regardless of your credit score.
Income
When applying for an RV loan, the lender will ask you to provide proof of income. Lenders may also ask you to produce statements of debts to calculate your debt-to-income ratio (DTI), which measures how much of your income is compromised by your bills.
Both of these factors help lenders determine your ability to repay the loan, as well as how much you can truly afford to borrow without turning into a financial risk.
Use Bankrate’s personal loan calculator to help determine how much you can reasonably afford.
Cost
On the low end, you can find a towable pop-up camper for as low as $5,000. High-end new RVs can cost more than $1 million. Before you start shopping, figure out what you want in an RV and what you can reasonably afford.
The age of the RV will also impact its price. A new RV will naturally cost more than a used model. But while it may come with sleek features, you will likely face steep depreciation, just like with a new car.
On the other hand, a used RV will have similar features but cost significantly less. You can also find RVs that are decades old — they won’t have nearly the amount of features as a recent model, but they will cost significantly less.
| New | Used | |
|---|---|---|
| Source: Camper FAQs | ||
| Class A | $50,000 to $300,000 | $30,000 to $175,000 |
| Class B | $70,000 to $150,000 | $40,000 to $115,000 |
| Class C | $50,000 to $150,000 | $30,000 to $75,000 |
| Travel trailer | $20,000 to $75,000 | $10,000 to $50,000 |
| Fifth wheel | $35,000 to $125,000 | $30,000 to $100,000 |
Credit history
While credit history requirements may vary by lender, having a solid track record of borrowing is important to lenders. This includes making on-time payments to major credit cards, as well as installment debts, such as student loans, personal loans or a mortgage, if applicable. Late or missed payments, as well as defaults, are typically frowned upon amongst most lenders, so the fewer you have, the better.
Lender-specific requirements
Approval requirements typically vary by lender. The most common variations include minimum credit score and income requirements. Some lenders may also ask questions regarding the use of the RV (whether it will be used as a primary residence or as a vacation home) to approve you for financing, as well as the condition of the vehicle.
Make sure to check this on each of the lender’s websites or by contacting customer support before applying to avoid unnecessary rejections.
The bottom line
Whether you’re buying a new or used RV, there are many lenders that offer financing. To improve your approval odds, make sure to assess your credit score and income before proceeding with a formal application. Also, shop around and get prequalified with multiple lenders to find the best deal available to you.
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