Motorhome Finance

[themountaintiger]

Want to buy my first motorhome. Set myself a budget of £15k which I would have thought should be able to get an unsecured loan for. If I want to increase my budget are there any 'best ways' of financing the purchase. Im aware unsecured loan wont really be suitable for higher than 15K and therefore perhaps HP is more suitable for higher amounts as the security is with the motorhome itself. I did get an approximate quote from a sales advisor based on buying a £30k motorhome, but over 10 years I would be paying about £18k in interest,

Any thoughts please?

 

[Peter JohnsCross MH]

All HP agreements now come under the Rule of 78 as regards early settlement rebates so you cannot get stitched up like John has been.

Ok it does cost but nowhere near as bad as before.

Just make sure if you do have HP that you dont get stitched up on the rate as dealers can earn good commission on long term finance.

Needless to say we dont!

Peter

 

[errpaul]

Have you consdered re-mortgaging???
I don't know if this is possible as you say you are mortgage free, but if it is then the loan to value would be very low and so you would get a far better rate than on a personal loan.
There are all kinds of flexible mortgage options for you to pay as much extra as you want per month, or clear when you like.

 

[themountaintiger]

what a difference a year makes

Another thing I have just come across is the difference a bit of looking around makes. The seductive motorhome I saw for £30k which over 10 years would cost approx £48k* with interest, I saw same model at another dealer for £25k which over 10 years would cost approx £40k* with interest. the same model was 1 year older but had half the mileage. But just the year difference made it £8k less overall. Ive decided im not going for hp but for those who may wish to still consider it, make sure you shop around as it is not just the price of the motorhome you might be able to save on, its the interest as well.

*basing rates on 10.8% APR

 

[themountaintiger]

using home equity

Have you consdered re-mortgaging???
I don't know if this is possible as you say you are mortgage free, but if it is then the loan to value would be very low and so you would get a far better rate than on a personal loan.
There are all kinds of flexible mortgage options for you to pay as much extra as you want per month, or clear when you like.

Just had a check on this method. Putting to one side for the moment the 'emotion' that the collateral in the house is being used.


Since my original post i have more or less decided to reduce my budget, however based on the 30k I originally mentioned it would cost in total over 10 years £34,635 which is 2.89% repayment, but is not fixed and therefore would be variable at 2.39% above base rate. Cost £288.63 per month. The HP alternative over 10 years would cost £400 per month and be £48k so using an off set mortgage would be £48k-35k = £13k cheaper. there is no set up fee for the remortgage so should be saving £13k ish subject to the interest rate staying the same. One kind poster hs already mentioned however that rates may rise and so this needs to be taken into account.

The good thing though is that with this method there would be the opportunity of paying the amount sooner and reducing the amount of interest to be paid, if paying over 7 years then £30k would cost £33227 and be at £395.56 per month which would be my top intended payment.

Thanks for this, If going down this route I think what i would need to do is see what the lowest fixed rate would be over 10 years and then any implications regarding the home, It would be as you say a low loan rate to the value of the house. hmm

thanks:thumb:

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[themountaintiger]

Follow up 2 years later....

Just wanted to follow up on posts almost 2 years old, when I was asking about how to finance my first motorhome. I had considered HP/loans etc. One or two funsters recommended just saving up first. I can appreciate their stance, however rightly or wrongly I managed to purchase a motorhome. Ive not regretted one bit of it...Waiting till I reached 55/65 after saving to purchase one would not have been the right solution.

I managed to do it by having a deposit and an unsecured loan and was able to have a budget for a 25k motorhome. Since its purchase its second hand part exchange value still stands at the price I paid for it 2 years later and I owe about 15.5k on it now...

But what fun it has given me...Ive used it for many weekends, bank holidays, 2 weeks in france. Ive been able to use it as a base for my hiking, kayaking, cycling expeditions and just drunken nights out!!...My girlfriend, hiking buddy and grandson have also enjoyed using it as well...What a great thing a motorhome is.

Ive been unfortunate recently to lose my step dad and his brother to cancer, both who were under 60 years old.... I would say that anyone considering buying a motorhome and the numbers stack up, go for it......


motorhoming....I just luv it!!

:smalllove:










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[motor roamin]

All I can say is well done.....I have just changed my RV last November after much deliberation......thinking If I don't do it now I never will........over Christmas I lost a friend of mine to cancer aged 45 she is a graet loss to all of us..........another aquaintance of mine lost his wife in the new year.........I know I did the right thing......enjoy every moment I am going too :thumb:

All the best Rick.

 

[wasp]

My M/H was £32000 plus interest made it 44000, I have had it sevenyears and am now paying the interest bit, it has been hard at times cos I am self employed but I have hung in there and kept paying I think it was worth it ,I have had some brilliant holidays and weekends away:Cool::Cool::Cool::Cool::Cool: