If you have a broad reaching desire to explore the great outdoors, but have poor credit history – it may be difficult applying for an RV loan. Bad credit can follow you around everywhere, and financing RVs with it can be next to impossible.
When your credit score is not great, you have a few options for financing an RV. The most common source of loans in this credit situation would be personal loans. We’ve looked around and found three lender aggregators that help out those with poor credit.
The loan amount for personal loans can range from $500 to $40,000. We recommend taking care when using these for an RV financial plan. And once you have your R V financing, it’s extremely important to ensure that you keep up in payments.
Make your motorhome or camper purchase a healthy addition to your credit history – not another bad mark in the file.
Top 3 Providers
1. AutoLoanZoom
AutoLoanZoom.com is great at connecting you to dealerships and lenders in your local area. This website has done the work and will search their network for the perfect match for you. They understand that credit problems from the past can haunt you and specialize in helping anyone and everyone. They aren’t a lender themselves, but rather have formed a network to help you find financing.
Even if you’re filing bankruptcy, you’re not excluded. They’re available in all 50 states, and there are no fees to be connected through their website.
They only list three requirements:
- You must have a regular source of income
- You must be at least 18 years old
- You must be a US Citizen or permanent resident
To apply and get connected with a lender or dealership in their network, all you have to do is go to their website and fill out AutoLoanZoom’s online form.
Once you fill in the form, they will connect you with a lender or dealership that works for you. Depending on who they connect you with, there might be additional requirements.
Before applying, there are a few documents you should have handy:
- Your Social Security Number
- Proof of Monthly Income
- Proof of Monthly Housing Payment
3. Lending For Bad Credit
As the name implies – Lending For Bad Credit is a website that was built from the ground up for customers with low credit scores. Founded in 2012, they specialize in sourcing loans for consumers with a poor credit rating. Their form takes two minutes or fewer to fill out, and if qualified, you can get funds as soon as the next business day.
The website lists loans as low as $100 all the way up to $40,000
3. 24/7 Auto Finance
24/7 Auto Finance offers a dealership network that will work with your poor credit. Their network is coast to coast, and they help cut out the middleman and directly connect you with those dealerships that will accept a poor credit customer.
They require:
- You must be 18 years of age or older
- You must be a current US Citizen or permanent resident & reside in the United States
- You must have full time employment or guaranteed fixed income of at least $1,500
Simply apply through their website. Fill out the form and they distribute your information throughout their network of partners.
Financing your RV or Travel Trailers With a Loan
When looking to finance a recreational vehicle, it’s important to keep a few things in mind.
A poor credit score isn’t the end of your dream. There are other financing options out there. If personal loans are out of the question, a home equity loan is another way to pay. These loans are secured, with your house being used as collateral.
Most lenders require you have a bank account when you sign up and require you to be at least 18 years or older with full time employment.
Always double check the paperwork throughout the loan process and make sure you understand all the terms in the application. There may be prepayment penalties or other issues that could cost you if you’re careless.
Buying an RV with Bad Credit
When searching for bad credit RV sales, it’s important to keep down payments in mind. The more money you spend up front, the less you’ll end up paying back in interest.
The rates for these loans can vary widely. If you have a low credit score, they’re almost always going to land on the higher side of the range. Over time, these interest rates can really end up coming back to hurt you. What seems like a minor difference in rates can actually cost you hundreds of dollars over the life of the agreement.
The less money you have to borrow for that RV or camper, the better off you’ll be when it comes to paying off the loan. Paying a sizeable cash sum up front also looks better to the dealership.
Approaching RV Dealers with Bad Credit
If you want to convince bad credit RV dealers that you are trustworthy, it always helps to come prepared. At least 6 months before visiting the dealer, check your credit score. This way you have a baseline on where you are before you head to the dealership.
You can get a free copy of your credit report from each of the three credit reporting agencies once every 12 months.
- Equifax Credit Information Services: 1-800-685-1111
- Experian: 1-888-397-3742
- TransUnion Corporation: 1-800-916-8800
Credit Scores fall in the following general ranges:
- 750-850 – Excellent Credit
- 675-750 – Good Credit
- 600-675 – Acceptable Credit
- 525-600 – Decent Credit
- 300-525 – Bad Credit
Once you know your credit score, dispute anything irregularities. Use good credit practices to raise your score and show the dealer you are committed.
Personal Loans
When looking at bad credit RV loans, usually the best option is going to be a personal loan. The interest rate can vary highly, depending on your credit score and personal situation. It’s always best to pay as much as you can as a down payment before using a loan to pay for the RVs finance.
Personal loans are unsecured against the borrower’s assets, and can be used for all kinds of needs. They are general loans, used for any kind of purchase – such as weddings or travel.
When it is initiated, the borrower agrees to pay back the initial amount of the loan plus any interest accrued. The interest rates on these loans can vary by large amounts. Always be sure to check multiple lenders and make sure you have the best one for you.
Banks and credit unions give these loans out and then are paid back through predetermined monthly or bimonthly installments. See our post on the best RV loans for bad credit.
Good Credit Practices
Your credit can haunt your life – and that’s a fact. Those who have good credit follow a few simple rules that have helped them to get where they are. During the 6-month period between getting your credit report and applying for your motorhome financing, do your best to follow them.
Here are some of those rules:
- Save up for down payments. The more cash you bring up front, the less money you will end up paying on interest.
- Pay your bills on time, every time. While this may seem like no big deal, you’d be surprised at how many people just let their bills slip by. Credit agencies will hold this against you, which factors in when applying for loans.
- Pay off existing loans and credit card balances. Try to pay as much as you can afford before applying for more loans.
- Don’t apply for any credit cards or loans. Every time you apply for a loan or a credit card, that inquiry is logged by the credit reporting agencies. If you apply too much, they make a note in your credit profile.
- Don’t close any existing credit cards. When you close out an existing credit card, it can actually damage your credit.
Once you’ve acquired your second chance RV financing, it becomes even more important to follow these rules. If you don’t, you could end up paying more than you can afford in late fees and other expenses – not to mention the devastation it would cause to your credit.
Conclusion
If you’re seeking adventure in the great outdoors, but just haven’t had great luck when it comes to credit – there’s still a chance for you. Whether your credit problem has been bankruptcies, situational, or medical, you still deserve your chance to experience the motorhome life.
Using the loan aggregators we’ve reviewed, you can explore what financing option fits you best. These lenders may hold you to strict conditions – but if you follow them, they offer you a second chance. Once you’ve been approved, you can take your loan application straight to the dealership for your RV.
That’s not the end of the story, though. Only with good credit decisions can you bring your debt to heel and ensure that your RV stays in your adventurous hands. Keep a checking account with regular income payments. Pay your bills on time and pay down your existing debt.
With these practices, you can be in your recreational vehicle and on your way to see the sights. You may also find our guide on the best time to buy an RV helpful.
You may also like: How to Paint the RV Exterior
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