According to the latest statistics maintained by the National Caravan Council (NCC), recent years have seen a resurgence in the number of new motorhome registrations. The trend is rising once again, after a slump that followed the financial crisis of 2008.
The purchase of a motorhome is a major expense – probably one of the biggest once you’ve bought your house – so new registrations tend to reflect the underlying state of the economy. Therefore, it may come as something of a surprise that, unlike the finance used to buy the majority of cars we drive, the majority (some 71%) of motorhomes are bought for cash, says the website Out and About Live.
Nevertheless, many of those making a cash purchase may have raised the funds through borrowing or some other form of credit, so if you are in search of motorhome finance, how might you get a great deal?
There are several different ways of arranging finance for the purchase of a motorhome, so the essential point to remember is that the great deal is the one that makes sense to you, in the light of your personal needs and circumstances.
Remember, too, that any finance deal is likely to be spread over a number of years and that involves a significant financial commitment, with major consequences – including the loss of your motorhome – if you default on the repayments. You may need to fight back the temptation to bite off more than you can chew and instead pitch your borrowing requirements realistically.
With so many variables to take into account and the need to consider as wide a range of potential purchases as possible, some of the most competitive deals may be made by a large, established and reputable specialist dealer in motorhomes.
Not only is such a dealer likely to have the largest selection of motorhomes from which to choose, but their range is also likely to cater for every pocket, including those who want to buy new and those who are looking to purchase a used or preloved motorhome.
Well-established dealers may also have their own specialist experts in motorhome finance to help you choose the appropriate type of credit for you, the amount you may need to borrow and the duration of any borrowing.
Motorhome dealers – and not just your high street bank or building society – may be able to arrange an unsecured personal loan with which to finance your purchase of a motorhome.
Indeed, many banks and building societies seem increasingly wary of advancing personal loans, even to their own customers, and you may find it easier to secure the borrowing you need, directly from the motorhome dealer.
A classic way of buying a major item on credit is through a hire purchase agreement – and many motorhome dealers are in a position to offer such deals too.
The typical hire purchase agreement involves your making a down payment by way of a deposit of about 10% of the purchase price, followed by equal monthly instalments until the balance is paid.
If you are buying under a hire purchase agreement, you need to bear in mind that ownership of the motorhome does not pass to you until the final instalment has been paid and that you may not resell the vehicle until any remaining finance has been paid off and you have obtained the hire purchase company’s agreement.