RV Refinance for Dummies

Refinance Your RV Now & Save

Have you been watching interest rates plummet over the past few months? Those falling rates mean good news for those who bought and financed an RV between 2000 and August of 2007. Thanks to the loan rate fluctuations of the past year, refinancing your RV loan now could save you a bundle. Refinancing at a lower interest rate can lower your monthly payments and significantly reduce the total amount of interest you pay over the life of the loan, saving your thousands of dollars. Lower monthly payments can also be advantageous to retirees or full-timers on fixed incomes.

Who Should Refinance?

The decision to refinance your RV should be based on the equity you have built up, age and current value of the RV and how long you plan to keep the RV. If you have built up enough equity so that the value of the RV is greater than the amount you owe on it, and if you plan to keep the unit for several years, it can be to your advantage to refinance. But if you are “upside down” on your current loan (owe more than the RV is worth) or plan on selling or trading it within the next 12 months, refinancing may not be right for your needs.

Refinancing Dollars & Sense

Here’s an example of how you can save by refinancing your RV loan.

2003 Winnebago Brave 36', bought for $100,000 in January 2003.

Down Payment: $ 20,000
Loan Amount: $ 80,000
Interest Rate: 9.00%
Loan Term: 180 months (15 years)
Monthly Payment: $ 811.41
Total Loan Payments: $ 146,053.80

Loan Balance of June 2008: $ 62,030.69
Refinance Rate: 7.00%
Refinance Term: 115 months (remaining term of existing loan)
Monthly Payment: $ 741.91
Total Savings: $ 7,992.50

Choosing a Lending Institution
Refinancing through a reputable institution familiar with RV loans is crucial to your getting the best rate and terms. RV Credit Direct, a Beacon servicemark, has over 50 years of experience in the RV loan marketplace and deals with banks nationwide that do RV lending. Other banks and credit unions may not fully understand the RV business and not be able to provide you with favorable rates or terms that will save you money over the long run.

Types of Loans
There are many types of RV loans available, such as fixed rate, variable rate, adjustable rate or balloon loans. The safest bet is a fixed rate term loan, in which you pay the same rate of interest throughout the life of the loan. This is less-risky because you do not have any additional costs should interest rates increase in the future. The concern with variable and adjustable rate loans is that, although these loan products may offer a slightly-lower interest rate at the beginning of the loan, the rate may increase over time, raising your monthly payment and risk. A term loan, as opposed to a balloon loan, eliminates any worries relating to obtaining future financing for the remaining loan balance at the time that a balloon payment would become due.

Another important consideration is to make certain that the loan does not contain any prepayment penalty. This allows you the option of making extra payments from time to time, or to pay the loan off early, without being charged any additional finance charges (or “penalty”) over and above the interest that you are already paying on the loan.

Do I Qualify?
It’s easy to find out if you qualify for a better loan rate. Visit www.RVCreditDirect.com to request a free rate quote. A representative will call you with your rate quote or you can have the quote emailed to you, whichever is more convenient for you. You will receive an answer within 24 hours on whether or not you qualify, and the appropriate paperwork will be expedited to you. The whole process usually takes only five to seven business days. You can also request an application when you call. Once your loan is finalized, RV Credit Direct will take care of paying off your old loan, making the refinancing process easy and hassle-free.

Why pay through the nose for a high-rate RV loan? Get a free RV refinance rate quote today.