A recent article in the caravan industry media about an upcoming auction of Chinese campers has prompted us to discuss the caravan loans available for those buying RVs at auction. The most popular way for buyers to obtain brand new caravans, campers and RVs is directly from the manufacturer or by ordering through their specified dealer network. Many manufacturers will build to specific customer orders or install the finishes to suit customer preferences. Showroom stock may also be available in dealerships.
Second-hand caravans can be obtained through a range of sources including the recognised caravan and camping industry websites and other predominantly online selling platforms. Many of these platforms will have safeguards for buyers, but diligence and care when buying online is always advised. Some online platforms may offer sales by auction while others will offer a fixed price.
Auctions through large auction houses are also a source of caravan buys. While traditionally on-site events, most auction houses have now moved to an online business model. This enables buyers from around the world to participate.
Leading auction houses include Grays, Pickles, and Lloyds Auctions. The particular auction we noted, which was a Lloyds event included imported RVs, prototypes and unfinished models. With buyers of new models still facing long delivery times, the RVs available at this auction were expected to fetch very strong pricing. Some apparently, are above the current retail pricing.
So would purchasing unfinished and prototype models and paying more than the recommended value pose any considerations in regard to the caravan loan and the insurance?
Let’s cover the options available to buyers purchasing caravans at auction.
Securing Caravan Loans Prior to Auction
Prior to attending an auction either online or in person, buyers should be aware of the payment requirements of the auction house. In particular in regard to the fees charged on the final price when payment is required and what payment methods are accepted.
Having finance arranged prior to attending the auction can provide confidence and certainty in the bidding process. For buyers purchasing a caravan at auction pre-approved caravan loans are available on Secured Caravan Loans or Unsecured Personal Loans.
Which of these loan types is most suited will depend on a number of aspects, in particular, the caravan itself – whether brand new or used. With a Secured Caravan Loan, the caravan is accepted as the security against the finance. Where the RV is not considered suitable security, buyers can consider an Unsecured Personal Loan.
Lenders will have their own guidelines around accepting vehicles as security.
When applying for pre-approved finance, buyers will need to provide details of the RV that they are considering purchasing so your Jade consultant can confirm with our lender whether or not that vehicle is suitable for loan security. Also, advise that you intend to purchase at auction so we can ensure the appropriate processes are in place for quick settlement with the auction house.
As the final purchase price is not always known prior to the auction, buyers can estimate the loan amount for the purposes of securing pre-approved finance. Remember to include the auction fees and charges and any possible costs that may be incurred in taking delivery if unable to do so yourself.
Pre-approved loans are applied for in advance of a purchase. Your Jade consultant sources the cheapest quote from across our lender panel and on your acceptance of that quote, the loan proceeds through the approvals process.
A time limit is placed on the loan offer. The loan must be taken up before the expiry time. There is no obligation to proceed. So if you are not the successful bidder at auction, no problems. The loan offer will simply expire according to the loan conditions.
Interest Rate and Loan Variations
There are no differences in regard to the interest rates on pre-approved loans compared with loans that are sourced after a purchase. The interest rate is based primarily on the credit profile and other aspects of the application.
There are however differences in the interest rate and other loan conditions between a Secured Caravan Loan and an Unsecured Personal Loan. Unsecured loans tend to attract a higher interest rate than secured loans.
In both instances, we can arrange loans at fixed interest rates. But Unsecured Personal Loans can be arranged at either a fixed or a variable rate.
If considering the purchase of an unfinished or prototype caravan which may not be accepted as security against finance, buyers may choose to request a number of loan quotes. One for a brand new vehicle for a Secured Caravan Loan and other quotes for used or unfinished vehicles with an Unsecured Personal Loan. The loan quotes may assist with the purchasing decisions.
Auctions can be great sources of good priced caravans. Being well-prepared with pre-approved caravan finance may assist buyers in securing the vehicle of their choice.
Contact Jade Caravan Finance on 1300 000 003 to discuss pre-approved caravan finance for auction purchases.
DISCLAIMER: THE DETAILS AND INFORMATION IN THIS CONTENT ARE PREPARED AND PRESENTED PURELY FOR INFORMATION AND NOT INTENDED IN ANY WAY AS THE SOLE SOURCE OF FINANCIAL ADVICE FOR CARAVAN PURCHASING. IF ADDITIONAL FINANCIAL ADVICE IS REQUIRED, READERS SHOULD REFER TO A FINANCIAL ADVISOR. NO LIABILITY IS ACCEPTED FOR ANY ERRORS, PRODUCT DESCRIPTION VARIATIONS, OR OTHER MISREPRESENTATIONS OF INFORMATION AS PRESENTED.