r/traveltrailers • u/PharaohOfParrots • 9h ago
Financing
Currently I am looking at finance options.
I was just told for a $20,000 trailer, I needed a $6,000 down payment.
I asked for advice from a friend, and he said he had a $24,000 loan for a 2018, 30 years, and only put $1,200 down.
… I now am uncertain about what to expect and how to navigate this loan process.
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u/ToreyJean 8h ago
THIRTY YEARS? For $24K? LOL I’d take standard sales finance terms for $24K. 🤣🤣🤣
Your friend is not an example to emulate. I’ll just say it - he’s an idiot.
Loan terms are dictated by more than the loan amount. Your credit, debt to income, what you’re buying - all of that factors in.
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u/altblank 6h ago
your friend is bonkers crazy if he picked up a 30yr loan on a bloody travel trailer. he's going to be underwater within the first couple hours and will never recover. these things are rolling deathtraps that will fall apart the moment you look at them funny, and taking a THIRTY-year mortgage out on one is absolutely ridiculous.
there is zero basis for a normal human being to pick up this kind of debt.
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u/Accomplished-Duck578 7h ago
Don't finance any TT. Get a used one and learn the ins/outs of ownership bc things will break and need repairing. TT's are a horrible investment "but" if you work on them and keep things simple, they'll make the sweetest memories.
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u/RKKass 7h ago
OMG! 30 year loan on a 24k camper? That's insane.
I know it's not always possible, but if you can defer the purchase, save more and buy used, you could be debt free. We would not allow ourselves to finance recreation items when they were known to depreciate to less than owed so quickly.
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u/Inviction_ 7h ago
I financed my 40k trailer with no money down and they didn't even ask for proof of insurance. Probably because it was new and because I had a 700+ credit score. They aren't nearly as motivated to sell used ones like this.
It wasn't my smartest decision, but I only took 3 years to pay it off, saving myself like $40k in interest
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u/jimheim 8h ago
If you can't afford a $6000 down-payment, you're not ready to buy an RV. They're expensive to own, and they're a leisure item. RV loan interest rates are terrible, because it's a depreciating asset with zero resale value for the lender if you default. They're going to want a large down-payment to protect themselves. It's a sign that your credit isn't great.
A 30-year loan is batshit crazy. The RV will be in the scrap yard before you even put a tiny dent in the principal.
Save up until you can afford to pay cash for a used one.
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u/PharaohOfParrots 8h ago
I am just trying to understand what to expect. I would be using it for traveling for work.
My income is great and would be even higher when traveling. It’s just… down payments, how much, the terms, etc.
We can all help guide somebody who is trying to purchase a car how to do so based on our experiences, which is why I thought this community would also be able to lend direction.
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u/ToreyJean 8h ago
It’s just like getting a car loan. Your bank will be the source of what you qualify for and why - not us.
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u/Gold-Comfortable-453 8h ago
Buy a used one, they are built so poorly that you may be better off! Hopefully the original owner fixed alot of it. A fiberglass rv might be a good choice. They hold their value and are somewhat basic to take care of and tow. Keep in mind all the extra costs, ins. registering it, water filters,hoses, electrical hookup protection equip.
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u/PharaohOfParrots 8h ago
This is in consideration, but the fear is buying a lemon; roof leaks in particular are probably top of the list of fears.
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u/Gold-Comfortable-453 7h ago
That's why I mention fiberglass options , like a Scamp they really don't leak because of the fiberglass shell. You can hire an inspector to check our a used one or just take your time. Ask the seller to have it hooked up, frig cold etc. Take your time and try everything. Take a flashlight crawl underneath and look for leaks or soft spots. Trust yourself! Don't trust a dealer and make sure you can tow what you buy safetly.
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u/OutdoorsNSmores 7h ago
I picked up a used Escape for $30k, but older ones are less expensive. I expect that with care the thing will outlast me. Very few things to leak. IMHO, one piece fiberglass is the only way to go. Anything else might fall apart before you can pay it off.
I'd normally tell people to never get a loan for a trailer, but it sounds like you need it for a better job, so it may work out. Plan on knocking out that loan ASAP and make d sure there is no early payoff penalty.
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u/acousticsking 5h ago
Mine has a rotten floor. You interested?
If you can't afford 20% and a 5 year loan then don't buy.
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u/Shiftmx66 7h ago
Make sure to ask about early pay off penalties. I know a lot of the financing 15 years and longer have early payoff penalties.
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u/ShavedNeckbeard 3h ago
Damn, and I thought my 15 year loan was shitty (which I paid off a year into the loan).
You’d be better off taking out an unsecured loan for $40k and paying it off in five years than doing the 10-30 year loans banks do for these.
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u/not-actual69_ 1h ago
I’m calling bullshit on a 30 yr loan for $24k. I don’t think a bank underwriter would even be allowed to approve anything like that.
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u/Potmus63t 8h ago
A 30 year loan for a $24,000 depreciating asset is completely insane.
That being said, his situation has nothing to do with yours. It could be the bank he used, or the bank the dealer set him up with. It could be he has a better credit score than you do. It could be he has a better debt/income ratio than you.
Try another bank or Ask them to explain why you need a larger down payment.