Fundamental to decisions to purchase new RVs or upgrade to a better model is being well-informed about:
Caravan finance and especially movement in interest rates.
An RV can be a considered purchase and having a good knowledge of the details of caravan finance can assist in guiding buyers to the cheapest caravan interest rates.
The cost of a caravan loan is primarily driven by the interest rate and that is where there can be significant variations across the caravan finance market. Lenders respond to Reserve Bank (RBA) rate decisions based on their own guidelines. That is one of the key reasons why we see these variations in rates across different lending markets and one of several important ‘need to knows’ for those seeking caravan finance.
We outline more of the key aspects of caravan finance that buyers need to know in order to achieve the cheapest, most suitable RV loan.
Types of RVs that We Finance
RVs- recreational vehicles, is an umbrella term which covers all the different types of caravans, campers and motorhomes on the market. We refer to ‘caravan finance’ as finance for all these different variations. Our caravan loans suit most new and second-hand caravans including the traditional models, camper trailers, motorhome, camper vans, toy haulers, off-road vehicles, expedition vehicles of all sizes.
The specific loan type – secured or unsecured, may be determined by the lender decision regarding suitability of the RV as loan security.
Types of Loans Available
We offer two loan types for caravan finance – Secured Caravan Loans and an Unsecured Personal Loan. The secured loan will suit most new caravans while the unsecured option is there for consideration when the RV is not accepted by the lender as suitable security.
The Secured Caravan Loan has a relatively universal format with the RV providing the guarantee against the loan. We ensure a fixed interest rate and a fixed finance term so customers have a fixed monthly repayment schedule which remains unchanged through the loan term.
No deposit finance is available, dependent on lender approval, so the full price of the RV plus accessories and extras, may be included in the finance amount. If customers choose, additional payments can be made during the loan term.
Consumer Finance Regulations
While there are variations in caravan finance across the lender market, buyers should be aware that all lenders that are in the consumer finance sector must abide by the Consumer Finance Laws. These are regulated through ASIC and include guidelines for lenders in regard to loan offers that they can offer to consumers.
Caravan Finance Market
While not all lenders will offer a specific Caravan Loan, many banks, finance companies and even caravan dealers and manufacturers do offer finance. Some lenders include RV finance in their more generic Personal Secured Loan categories. More specialist lenders in the sector, such as Jade, do offer specific loans for this category of goods.
There can be variations in the loans offered for RV finance in regard to the interest rate, the type of rate -variable or fixed, certain conditions and possibly other features. When comparing loans from different lenders these features should be considered closely to ensure they are suitable.
Our services as a broker-style caravan finance lender provide customers with the advantage of having a large number of lenders canvassed in order to source the cheapest interest rate caravan finance. In addition, our consultants negotiate with lenders to achieve the most suitable loan offer for our customers.
RV Finance Interest Rates
As mentioned above, the interest rates on caravan finance can vary from lender to lender based on a number of reasons. The rates advertised by lenders will typically be for new goods (caravans) and for offers to finance applicants that are assessed for good creditworthiness. That means maintaining a good credit score and having a good balance sheet.
The RBA has increased the cash rate significantly since May 2022 and has indicated that further rate rises would be expected in the time ahead. For those planning an RV purchase with caravan finance in 2023, remarks in the RBA December Board Meeting minutes may be of interest.
The meeting minutes revealed that the Board considered three options in arriving at their December rate rise decision of 0.25%. Those options were a 0.5% rise, 0.25% rise and 0% change, which would leave the current rate unchanged. The arguments for each of these options was discussed. These discussions plus remarks made by the RBA Governor Philip Lowe reveal that larger rate rises and leaving rates unchanged are still on the table.
So the interest rate situation for 2023 may once again be a wait and see story each month.
Getting the most from Caravan Finance Calculator
Many RV buyers are taking advantage of a Caravan Finance Calculator to assist in making their purchase decisions. This is great but we urge calculator users to read the instructions and use this tool as intended. It is important to be aware that there may be a lag between when you use the calculator to get repayment estimates and when you take delivery of your caravan and finalise the RV finance. During that time, interest rates may change.
Ordering at Caravan Shows
Buyers will often take full advantage of caravan shows to compare new models and make purchase decisions. To assist in this process, we offer pre-approved caravan finance. The RV loan can be applied for and processed through to the approved stage ahead of a purchase decision.
Pre-approved caravan finance do have a confirmed loan quote which is valid for a set time period. So buyers have the confidence to proceed with their purchase.
Hopefully this overview has provided the information required to proceed with a RV purchase with caravan finance from a more informed position. If you have further queries, please reach out to us for assistance and information.
Contact Jade Caravan Finance for cheaper caravan finance on all types of new RVs
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.