Financing Caravan Purchase
What Is Caravan Finance?
This is a financial arrangement that allows you to get access to the purchase sum of a caravan. In return, you promise to pay interest and make repayments over a period. All you need to do is find a willing lender. Once you do, you agree on the terms of the finance agreement. You then receive the purchase sum required to get your caravan. After getting the caravan, you can now begin repayment.
At Somewhere Else, we are not finance brokers, neither are we lenders. However, we have third-party partners with considerable years of experience when it comes to caravan finance. You can reach out to them to get this done.
What You Need to Get Caravan Finance
Applying for caravan finance has been made easy over the years. You can apply online easily, or you can opt to apply through the phone. You’ll then need to provide relevant documentation regarding your identity, employment status and source of income, residential details, credit status, other ongoing liability, the caravan you want to purchase, and your assets. Once you provide these relevant details and authorise the finance brokers, they get you a finance deal that meets your needs.
Caravan Finance Options
If you’re looking to get caravan finance, there are various options that you can opt for. They are:
This refers to a loan arrangement where you don’t have to worry about providing an asset as security for the loan arrangement. Under this type of loan, you apply for the loan by providing the requirements such as proof of identity and income. Once you do this, your application is assessed, and you can get access to the loan.
This is a caravan finance option that needs you to provide an asset as security for the loan arrangement. Generally, you can opt to provide an existing asset to secure the loan. However, in most cases, the caravan is what is used to secure the loan arrangement.
Generally, you can finance both old and new caravans. As such, the caravan you decide to finance will depend on your choice. However, financing the purchase of a used caravan requires more attention to details. This is because the lender will need to confirm that the used caravan is still in good condition and still has a considerable useful life. If this cannot be established, the lender will typically refuse to finance the used caravan.
Generally, when you’re looking to get caravan finance, you’ll need to provide various documentation to access the finance. One of this documentation is proof of employment. However, in some cases, it might be impossible to provide this as the borrower is self-employed. This is where this option comes in.
This is a finance arrangement that allows you to access the finance that you need with little or no documentation. Under this arrangement, you don’t have to worry about the plethora of documentation that comes with orthodox options.
One of the requirements you’ll need to meet is to have a good credit status to get caravan finance. However, if you don’t have a good credit status, that’s not the end of the world. You can still get access to caravan finance. This is through a bad credit caravan finance.
This option is suitable for those with bad credit and allows them to access the needed finance. However, this option usually comes with an increased interest rate. Also, there might be a limitation to the sum that you can borrow and the duration that you can borrow for.
Most times, what we do is dream about getting that new caravan. In most cases, we don’t get to buy it and own our dream caravan. While that is understandable without caravan finance, it becomes disturbing when people don’t take advantage of caravan finance to get themselves the caravan of their dream.
Unfortunately, this is because of the presumed uncertainty that most people believe comes with caravan finance. Is the finance tool safe, can I afford it, can I afford to take a loan and repay it? All these can cause some people to hesitate when it comes to getting caravan finance. Well, you don’t need to worry about uncertainty anymore. You can now get clarity through a caravan finance calculator.
This is a tool that allows you to get an estimate of how much you’ll need to repay under the terms of a loan arrangement. In turn, you can easily determine if the terms of the agreement are convenient for you. Even better, you can adapt the terms of the arrangement to your specific needs to ensure that you get a comfortable repayment plan.
To use this tool, you’ll need to provide specific information. They are.
The Loan Amount
This refers to the amount that you intend to get from the lender. This is usually the caravan’s full price or part of the caravan, depending on your decision. It might also include another incidental cost, such as the cost of insuring the caravan.
This is generally regarded as the cost of the loan. It refers to the loan percentage you’ll need to pay to the lender to borrow the money. It will depend on the type of loan arrangement that you opt for.
The Loan Term
This refers to the duration of the loan arrangement. It can be either long-term or short-term, depending on the arrangement between the parties. Usually, the type of loan you opt for will also greatly affect the loan arrangement duration.
The Repayment Schedule
This will involve how often you plan to repay the loan. This can be either monthly or weekly or even biweekly, depending on the arrangement. However, the monthly repayment schedule is more common.
There is a wide range of questions that might arise when it comes to getting caravan finance. We have provided answers to the frequently asked ones. This way, you can have some clarity about the process before getting into it.
Can I finance all types of caravans?
Yes, you can finance all types of caravans. Caravan finance allows you to finance all recreational vehicles. All you need to do is make a pick of your dream vehicle. So, whether off-road or camper trailers, you can always get a finance option that allows you to bring your dreams to reality.
Will my interest rate be high or low?
Generally, lenders and banks describe the interest associated with caravan finance on their site. Note that this varies over time, depending on the terms obtainable in the industry. However, this rate is only a guide that allows you to know your likely obligation. Usually, the eventual interest rate you get will depend on your credit status, the type of loan you opt for, and other details of your application. So, in some cases, the rates might end up being the same, and in some other cases, the rate might end up being higher.
Should I get an unsecured loan or a secured loan?
When it comes to a secured loan, you provide an asset as security for the loan arrangement. Usually, you can use the caravan you intend to purchase to secure the loan. Generally, this option comes with a lower interest rate, a longer duration, and a higher loan amount. On the other hand, under the unsecured option, you don’t need to provide any asset as security for the loan agreement. In turn, thanks to the increased risk that the lender bears, you’ll need to pay a higher interest rate.
What is the maximum duration that I can get caravan finance for?
You can get a loan term between two and seven years. However, it will depend on a wide range of factors, such as the type of loan you’re opting for and the loan duration. Getting a new caravan will allow you to access a longer loan duration than getting a used caravan. However, keep in mind that each lender determines this. They assess applicants and determine the appropriate loan term. You can still discuss with your broker and lender to intimate them with your preferred loan term