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Compare RV loans
Compare financing options for your motorhome and hit the road sooner.
What are RV loans?
An RV loan provides the financing to help you purchase a new or used recreational vehicle, including motor homes, travel trailers, toy haulers and campers. RVs can cost as little as $10,000 up to $150,000 or more depending on the size and model. Just like typical auto loan, financing for an RV is long-term over the course of 12 months up to 10 years.
Some RV loans come with a fixed interest rate so your monthly repayments will be the same every month. Other loans have a variable interest rate, which means your repayments may fluctuate, but the rate tends to be lower.
Compare RV loans
What's in this guide?
- What are my RV loan options in Canada?
- What RV loan interest rates are available in Canada?
- RV loans for bad credit
- How should I compare RV loan options?
- What to avoid with RV loans
- What types of RVs can I buy?
- Checklist for buying a camper trailer
- Are there any other costs I should expect with my RV?
- How to apply for an RV loan
- Frequently asked questions
What are my RV loan options in Canada?
When it comes to financing your RV, you generally have 3 loan options to choose from.
1. Dealer financing
Many RV dealerships offer financing to qualified borrowers when they choose to purchase an RV. Much like car dealerships, you should come prepared with a pre-approval offer from a different lender to negotiate a better interest rate.
You may be able to get a low rate if you have excellent credit and a down payment on your new vehicle, and if you need low monthly payments, some dealerships offer financing terms of up to 20 years (less for a used RV).
2. Car loans
Some banks, credit unions and online lenders have car loans available for RVs. Loan amount and terms will vary by lender.
However, it may be more difficult to qualify for a car loan than either dealer financing or a personal loan. This is because RVs depreciate quickly, and many owners end up owing more on the loan than the RV is worth. If your RV is being used as collateral for car loan financing and you default and cannot repay the loan, lenders might be stuck with an RV that has no resale value.
Examine your options carefully and don’t borrow more than you need when applying for a car loan to cover your RV purchase.
3. Personal loans
Personal loans can work for a variety of purposes. There are lenders who may be willing to work with you even if you have little income or a less-than-ideal credit score. You can apply for a personal loan from a traditional lender, like a bank or credit union, or an online lender.
An RV loan can be either a secured personal loan using your purchase as security or an unsecured personal loan. If you opt for a secured loan using your RV as collateral, for example, you can take advantage of a lower interest rate.
Some lenders offer loan amounts up to $100,000 for people with very good credit, while others focus on borrowers who may have less-than-perfect credit. If you’re looking to purchase an RV and want funding before you actually start browsing for an RV, then a personal loan may be a good way to secure financing so that you know what you can afford before walking into a dealership.
Representative example: Nadya buys an RV
Nadia, who lives in Alberta, has always wanted to tour the country to see the sites and visit some of Canada’s best parks and conservation areas. She figures an RV is just what she needs, so she heads to a local dealership to check out her options. Nadia looks at a 2019 Sunset Park Sunray 169 travel trailer and decides it has everything she’s looking for. The purchase price $22,000.00, so Nadya pays a 20% deposit of $4,400.00 and applies for an auto loan from her bank to cover the rest.
Because Nadya has a solid credit history, she is approved for a loan to cover the outstanding amount on the RV plus 5% GST ($17,600.00 + $1,100.00). Along with the cost of her loan, Nadya also pays a little over $100.00 to register her RV with the provincial government.
|Cost of new RV travel trailer||$22,000.00|
|Loan type||Auto loan (term loan)|
|Interest rate (APR)||5.90%|
|Loan term||5 year|
|Additional fees||4.00% origination fee ($748.00)|
$0.00 application fee (waived by dealership)
|Payment||$360.65 monthly or $166.27 biweekly|
|Total loan cost||$21,639.00 with monthly payments or $21,615.10 with biweekly payments|
*The information in this example, including rates, fees and terms, is provided as a representative transaction. The actual cost of the product may vary depending on the retailer, the product specs and other factors.
What RV loan interest rates are available in Canada?
You’ll find RV loan interest rates vary depending on whether you’re looking for financing from a bank, an online car loan lender, or a dealership. Unsecured and secured loans also come with different interest rates. Below is a quick comparison of rates, terms and loan minimums from various types of lenders offering RV financing.
|Example rates||Example term lengths|
|Traditional banks||4% to 12%||12 months to 10 years|
|Online lenders||0% to 30%||3 months to 8 years|
|Secured personal loan||20% to 24%||3 to 10 years|
|Unsecured personal loans||27% to 47%||6 months to 5 years|
These are just general ranges (as of February 3, 2021) to help give you an idea what interest rates and terms may be available. Keep in mind that the exact rate you’re offered will depend on each lender’s requirements and assessment of your financial situation.
What factors impact your RV loan’s interest rate?
Your credit score, down payment and your loan amount are all key factors that help to determine the interest rates that are available to you. If you have excellent credit, current RV loan interest rates can start at as low as 0% to 3.99% but if you aren’t the best candidate for an RV loan, interest rates can be as steep as 29.99% to 46.96%.
It’s worth improving on your credit score and saving up for a larger down payment if your goal is to secure a lower RV loan interest rate. In the long run, you won’t spend as much money on interest.
RV loan repayment calculatorSee how much you'll pay with an RV loan
|Loan terms (in years)|
RV loans for bad credit
Don’t be discouraged if you have a bad credit score – while having a credit score between 300 and 600 will limit your options, there are plenty of lenders who will still help you secure an RV loan. You may encounter high interest rates for any loans you are approved for though.
RV dealerships and online car loan lenders offer bad credit RV loans for consumers who are dealing with bankruptcy, bad credit, or no credit at all. If you have no credit or your credit is in bad shape, your loan amount may be smaller and have steeper interest rates. With bankruptcy, the process of securing an RV loan may take a bit more time because your lender may need more information from your trustee.
Need a car loan with bad credit? Try a secured car loan.
With steep interest rates and extra fees, bad credit car loans may not be financially feasible. If their terms are out of your price range, secured financing products are also worth looking into. The more security you can provide to your lender, from including a co-signer or using an asset as collateral, the more likely it is to offer you financing. Secured financing options include:
- Home equity loans. With home equity loans, you’re using the total real estate value of your home (excluding the remaining balance on your mortgage) as collateral to secure your RV financing. This is a great way to lock in better RV loan interest rates but you need to tread carefully. Your lender has the right to seize your home if you can’t keep up with your loan repayments.
- Guarantor/co-signed loan. If you can’t qualify for a traditional RV loan on your own, you can ask a family member or close friend to co-sign on your loan and act as a guarantor. The catch? If you default on payments, your guarantor will have to pick up on your loan, so make sure they’re aware of what they’re committing to. Both of your credit scores will take a hit if you default on your loan.
- Secured installment loans. Once you’re approved by a lender, you’ll receive a lump sum loan, which you’ll need to repay in installments. Most of the time, your RV purchase is used as your collateral but you can also offer up other assets, including your primary vehicle to secure your installment loan. If you can’t keep up with your RV loan, your lender has the right to seize the assets you used to secure your loan.
How should I compare RV loan options?
- Look at the APR. Your loan’s APR is an expression of your loan’s interest and fees as a percentage. It’s the easiest way to compare costs on loans with the same term.
- Will the loan be secured or unsecured? RV loans can either be secured or unsecured. Unsecured loans do not require you to provide collateral, but they often have higher interest rates to make up for it.
- Are there flexible payment options? Most RV loans have flexible loan payments, offering anywhere from weekly to monthly payments.
- See what loan terms are offered. The amount of money you borrow will influence the term length. Make sure you know how long it’ll take you to repay the loan before agreeing to anything.
What to avoid with RV loans
- Going in without known your credit. Knowing your credit score before you apply can help you avoid applying for a loan you’re ineligible for and possible damaging your credit with too many inquiries.
- Not negotiating the price down. Many dealerships offer marked-up prices with the expectation that you’ll ask for a lower price.
- Not comparing financing options. The first type of financing you find could be the best deal out there, but there’s no way to know unless you shop around.
- Long loan terms. An extra long term might give you lower monthly repayments but you’ll pay more in interest and could end up owing more than your RV’s resale value.
- Committing to a high loan amount. Make sure you’re not borrowing more than you can afford. If you’re in a lot debt or your credit is poor, it may be a better idea to pay other debt down before taking on more loans.
- Any hidden surprises in your contract. Be sure to read the loan contract in full before signing anything. Look out for hidden fees (including early repayment fees) and terms.
What types of RVs can I buy?
No matter which road you chose to travel on, there’s an RV out there for you. Make memories in a towable RV, a full-sized motorhome, or anything in between.
Checklist for buying a camper trailer
“Different strokes for different folks” holds true when it comes to shopping for a camper trailer. But keep an eye out for a few things that can affect your travels if they’re overlooked:
- Chassis. This is the base frame of a trailer and plays a crucial role in holding it together. For more durability, look for a chassis made of high-quality materials — especially if you’re planing to carry heavy loads of drive off-road. Frames are usually made of wood, steel or aluminum. Aluminum is the best choice because it’s rust-proof, impossible for termites to eat and lightweight, making your drive much more fuel efficient.
- Suspension. Suspension springs should be strong enough to take the weight of the trailer as well as the load that it carries. Make sure you pay attention to the condition of the trailer and find out if the suspension can handle driving off-road or on irregular roads.
- Tailgate and doors. Remember to check all seals, not just on the doors and the tailgate, but also on all compartments and even the tool box to avoid water damage and rust buildup.
- Towing. The towing coupling should be strong enough to take the camper trailer’s weight and everything it carries. For off-road driving, getting a coupling that turns 360 degrees is ideal. In addition, consider getting recovery points (sometimes called snatch points) at the trailer’s rear section to help move the trailer in reverse in case you’re stuck in a ditch or somewhere that you need to back out of. Make sure the recovery points are strong enough to handle this kind of movement (often, these mechanisms aren’t built strong enough to handle lots of stress).
- Protection. Camper trailers tend to flick up stones from time to time, even on completely paved roads. Some trailers deflect these stones by using built-in stone guards or shade cloth attachments to bridge the space between the trailer and the car.
- Tires. If you can manage to get the same set of tires on your trailer as you have on your main vehicle, you can look forward to a smoother drive.
- Trim. The canvas on your camper trailer should be durable, given that it provides shelter. But remember that lightweight canvas is quicker and simpler to set up. Check for water proof and mildew proof materials with no holes.
- Bedding. Make sure there’s enough bedding for all your travelers. Measure the beds (especially if they look small) so you know exactly what to buy.
- Possible add-ons. While the list of add-ons can be very long, most camper trailers tend to include water tanks, jockey wheels and awnings.
Are there any other costs I should expect with my RV?
Owning an RV is more than just paying the purchase price and driving away. When you commit to an RV, you need to make room in your budget for a number of related and ongoing expenses.
- Maintenance. RVs need yearly maintenance. The cost will vary based on the age of your RV and how often you use it. If you tow a trailer, you should also factor into your budget the cost of maintaining your primary vehicle as well.
- Fuel costs. It doesn’t matter whether you’ve opted for a diesel or a gas engine — you’re going to be paying quite a bit in fuel costs. Before you start on a trip, look up average gas or diesel prices at regular points along your route and start saving up.
- Park fees. Some parks and campgrounds charge per night. Depending on how long you want to stay, you might quickly find that just having your RV parked on a slip can be a pricey expenditure.
- Hookup fees. In a similar vein, you’ll likely have to pay to hook your RV up to electricity and plumbing. While it might not be as expensive as a hotel, you should still factor basic amenities into your budget when planning to buy one.
- Storage. Unless you plan on living in your RV year-round or have a space to keep it when not in use, you’ll have to pay for storing your RV in the off-season. This can start at a few hundred dollars per week, although you may be able to find a cheaper deal if you:
- Look up private listings for RV storage on people’s personal/home properties
- Opt for storage without heating and protection from wintery elements.
These options will definitely increase your risk as you may not know how responsible a private storage seller is and you don’t want your vehicle to become damaged in bad weather. So choose wisely.
How to apply for an RV loan
If a RV loan sounds like it’s right for you, applying for one is very easy.
Typically, to be eligible for RV financing you must be at least 18 years of age and a Canadian citizen or a permanent resident. You must also have a good credit rating and be able to provide the lender with your financial details — bank statements, pay stubs and any other documents relating to your personal income, assets and debts.
What documents will I need for my RV loan?
Your application will run much more smoothly if you have all of your documents ready and available when you apply for a loan. You’ll likely need:
- Valid form of government-issued photo ID such as a driver’s license or a passport
- Social Insurance Number (SIN) card
- Employment information and proof of income such as a few of your most recent pay stubs or Notices of Assessment from both the current and previous tax year
- Proof of residency such as a recent utility bill, bank statement, phone bill or anything that has both your name and address printed on it
- Personal details such as your address, phone number(s), date of birth and email address
- Either a VOID cheque or a withdrawal authorization form from your bank so that your loan repayments can be automatically debited from your bank account (some lenders may accept other forms of payment such as a mailed-in cheque or money order)
Frequently asked questions
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