Learning how to buy a used RV for sale by owner, or even a new one, can take a lot of time. Even if you know exactly what you’re looking for, you still want to carefully check all of your options. Do you want to buy it from a dealer or from a private party seller, or maybe even from an RV auction?. If you decide to buy from a dealer, and you want to buy it with a trade-in, do you want to pay cash for it, or do you want to see if you can get the dealer to finance your RV.
These are some important things to consider. First of all, newer RVs are going to cost you a lot more. RVs tend to lose 30% of their value during the first year that you own them. However, newer RVs might be easier to get financing on. This is because you can get a lower insurance rate on a new RV. Most banks and lenders think of that lending money on a new RV is less of a risk and so they are willing to give you a better rate. You have to carefully check whether it is worth it to buy a new RV just so that you can save three-quarters of a percent off the interest rate you would get on your RV. I have seen a lot of people get into financial trouble with their RVs. My suggestion is to buy a used RV for less money. This means your payment will be lower because the amount of money you borrowed is lower. You can also pay the RV off a lot faster.
What are Some Reasons to Pay Cash for a New RV?
Every year thousands of RVs are repossessed by lenders. When you pay cash for your RV, you never have to worry about this happening to you. In addition, when something breaks down on your RV, you don’t have to worry about fixing the RV and making your RV payment in the same month. It is much easier to keep your RV running properly on a fixed income, if it is already paid for.
Even though it requires a little of extra sacrifice and perhaps even waiting an extra year or two to buy an RV, it is definitely worth it to pay cash. The biggest advantage of paying cash is that you don’t cut into your monthly cash flow.
Don’t Buy Extended Warranties
If you have to finance your RV, avoid one of the biggest pitfalls you can get. One of the biggest pitfalls is to buy an extended warranty. Generally, a new RV comes with a six month or one year warranty anyway. The extended warranty doesn’t even come into play until after the manufacturers warranty expires. Not only that, most extended warranties aren’t even that great. Dealers make a lot of money when they have these on to the backend of your purchase. Remember that if you are going to pay $5000 for an extended warranty, you will actually be paying interest on that $5000 for the next 5 to 10 years. This means, that you could be paying more than $10,000 total for this warranty. The dealer takes a huge cut out of the premium for the warranty. Be very careful with warranties that are only valid if the vehicle is properly maintained. If you forget to change your oil every 3000 miles, and forget to have your transmission flushed on a regular basis, your warranty might be invalid.
If the dealer mentions they are including repairs or towing charges for the first three years, make sure that you get these in writing. Large motorhomes are very expensive to tow if you ever do need the service.