The initial cost of your travel trailer or RV will dictate the majority of what your RV payment will be. Other factors of how much your trailer payment will be are down payment, taxes upon purchase, interest rate on the loan, term of the loan, accessories added, insurance, and licensing/registration costs.
Many dealers advertise very low prices per month, but fail to mention these are very long term loans. In order to be at a $150 per month payment like many dealers advertise, you would have to buy a $20,000 trailer with 0 down payment. Finance rate would be 4% and term would be 15 years.
How much is the average RV payment?
The average RV loan can vary wildly, but on average a RV loan is $225-$650. This figure is based upon a $35,000 travel trailer at varying interest rates and payment terms with zero dollars for a down payment. Other travel trailer prices and payments can vary depending on many factors.
Lets go through the process of breaking down the monthly payment cost over different variables. All of these variables will vary depending on the travel trailer you choose, your credit, how much down payment, the term of the loan, the interest rate, etc. Lets get into the RV monthly payment guide.
RV Monthly Payment Guide
What is the average RV Payment
What is the average RV Payment
Initial Cost of Travel Trailer
Travel trailers or RV’s vary wildly in price. Travel Trailers can cost anywhere from $10,000 to over $100,000. RV’s can cost from $40,000 to upwards of $300,000. On average, I would peg the average consumer spending $20,000-$35,000 to get a good quality travel trailer. For this example, we will use a price of $25,000 for a travel trailer.
Total Purchase Price $25,000
You may be able to add some accessories at the time of purchase to your RV loan, this could include solar panels, generator, weight distribution hitch, or other items. When you add accessories at the time of purchase, you may able to add them to the financing on your travel trailer. If you are looking to get any bigger items, look into purchasing them with your RV as there may be an additional discount or your dealer may throw in a hitch for free. For our example, lets add a weight distribution hitch for $500 included in our purchase.
Total Purchase Price $25,500
Many states have sales tax, if yours doesn’t, woohoo you can celebrate your reduced trailer cost. If not, prepare to add an additional amount to your trailer purchase. The average state tax rate in the United States is 6.5% over all 50 states but range from 0% up to almost 10%. Lets use 6.5% in our example. 6.5% of the purchase price would total $1,657.50 on this transaction.
Total Purchase Price $27,157.50
If you have money laying around, it is a good idea to put some money down on your travel trailer purchase and may even be required by some lenders, but make sure to save some for some accessories and gear. If you put $5,000 down on our example price of $25,000, you would only need to finance $20,000. The amount of a down payment can directly affect how much of your purchase will need to be financed. For this example we will use a down payment of $2,500 so you can have some money left over for your accessories or a generator.
Total Financed Price $24,657
At the time of this writing, RV loan rates range from 4.74 to 6.79%. A longer term also affects these rates as will your credit score and many other factors. If you have a relationship with a local bank, this may be the best way to get a good rate. We have seen some local banks advertise 1.99% recently, but could not find any of these promotions while doing our research.
For a loan under $25,000 terms we have found popular term ranges from 48-144 months or 4-12 years. The term can drastically change a payment amount, for example, if you finance $25,000 over 4 years at 5%, you would pay $575 per month. Under those same parameters, a 12 year loan would result in a $231 monthly payment. The kicker is that over the 4 year loan you would pay $2,635 in total interest whereas over the 12 year loan you would pay $8,296.
What is my RV payment?
If you make this purchase and pay on a 5 year loan using the above parameters, your payment will be $575 per month. Below is a table of monthly payments based on the term of the loan based on 5% interest as well as a row showing the total interest paid.
Length Of Loan 4 Years 5 Years 8 Years 10 Years 12 Years Monthly Payment $529 $434 $291 $243 $212 Total Interest Paid $2,424 $3,042 $4,953 $6,274 $7,632
In house financing vs your own Lender
It is always a good idea to compare lenders rates as the lender your dealer typically uses may have higher fees or rates. When we were shopping, we found lenders that were lower than our dealer by 1% or more. This can make a big deal over the life of the loan especially if it is on the long side. In good faith, you can always ask your RV dealer to match the loan to give them the business, but if they can’t, try and save money where you can. Always remember, auto loans are easy to refinance, so if rates go down, you can always refinance very quickly.
In addition to your trailer purchase, you will have to pay annual registration fees. Typically these may range from $100-130, or may vary depending on your state. Licensing your vehicle will give you plates so you ar legal to drive on the roads. Some registrations may give you the option to buy a parking pass to your states parks. This may be a good idea. For our state, the option is $40 additional dollars per year. But each time we go to a state park it costs $7 to get in. So this $40 at time of license saves us after 5 times we go in.
Your new travel trailer will require insurance. For our 21’ unit, we pay $430 per year or about $35 monthly. This seems to be a fairly cheap number for the piece of mind of full coverage. Always check with your insurance companies for the best rate and play around with different coverages. We found that we could add coverage for other items and our liability for only a couple of bucks more per month. It’s worth the extra time to get the right rate for you.
To sum up this article, we have given you some examples of different payment terms. What you pay for your travel trailer, interest, and term are the largest factors on your RV monthly payment. When you are shopping, you will find your sweet spot for your budget with the cost as well as term, and your interest rate will be determined based on what bank you use and what current market rates are. We hope you enjoy the process when you are purchasing a trailer, it is a difficult and stressful time so make sure to take a deep breath and have fun!
These monthly prices may seem a bit high, but we have an article that describes how you can help offset some of your RV purchase price by renting it out to others, or even get it paid for.
What are typical RV terms?
Typically, RV loans range from 4-15 years. As your RV purchase gets more expensive, you can choose a longer term to lower your monthly payment. If you are financing a large RV typically over 50,000 some banks will lend up to 20 years.
Is an RV Tax Deductible?
Under current regulations, a RV is deductible as it can be qualified as a second home. The interest is what you could save by deducting from your taxes, but typically this will just reduce your expenses, but the interest you pay to the bank will still be more.
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What is the average monthly payments on an RV? ›
Most RV loans are long-term, which can help keep your monthly payments low. Terms will vary depending on several factors, including the RV's age, credit history, et cetera. As for monthly payments, the average monthly payment for an RV will be anywhere from $225 to $650 monthly.What is a good rate for an RV loan? ›
The best RV loan interest rates currently start around 4.49 percent for borrowers with excellent credit. However, the actual rate you receive depends on factors such as your credit score, debt-to-income ratio and annual income.How long do you finance a camper? ›
RV Loan Options
Most RV loans are financed by RV dealerships, banks, and credit unions. RVs can be considered primary or secondary homes so lenders can offer loan periods that can stretch out between 5 and 20 years. Interest rates can be as low as 3.99% or as high as 35.99%.
RV loans are available from online lenders, banks and credit unions. Banks and credit unions will be more likely to offer secured loans, which typically have lower rates, but may require a down payment.Is it financially smart to live in an RV? ›
It is financially smart to live in an RV. Living in an RV means living a lot smaller with a lot less stuff. You have less room for everything – clothes, toys, tools and more saving you a lot of money. Along with less space, you save on utilities and home-improvement projects if you own your home.How do people afford full time RV? ›
- Campsites don't have to break the bank. State parks are a great low-cost option, as are many campgrounds. ...
- Travel slowly. Gas is usually one of the largest parts of an RVer's budget. ...
- Limit your purchases. It's somewhat easy to limit your purchases while traveling in an RV. ...
- Make meals of your own.
If you are considering purchasing a camper and are more patient than wealthy, save for it. A $10,000 loan financed for 5 years at 4% interest would have payment of about $185 per month. If you saved that same $185 you would be able to pay cash in 54 months (4 1/2 years) and save yourself over $1000 in interest.Is financing a camper hard? ›
Securing financing for an RV could be more difficult than getting approved for a car loan. In fact, depending on the length of your loan term and the amount you're borrowing, qualifying for an RV loan could be similar to qualifying for a home mortgage.What time of year is best to buy RV? ›
You'll generally find the best time to buy an RV is during late fall and winter. Fewer people shop during this period, and less competition means you'll have more negotiating power. You can also find bargains right before a new RV model is released, when gas prices are up, and at RV trade shows.Are RV prices dropping? ›
The RVIA sees this decline as a return to normal market trends, which it expects to carry over in 2023. As 2022 draws to a close, RV prices are declining across all classes but one. Class B motorhomes are still very in high demand, perhaps in response to high fuel prices.
What is the monthly payment on $20000? ›
The monthly payment on a $20,000 loan ranges from $273 to $2,009, depending on the APR and how long the loan lasts. For example, if you take out a $20,000 loan for one year with an APR of 36%, your monthly payment will be $2,009.What are the negatives of living in an RV? ›
- Fatigue. We'd be lying if we didn't say that living a nomadic lifestyle doesn't get tiring. ...
- Lack of routine. ...
- unexpected issues. ...
- WiFi connectivity and reliability. ...
- cost. ...
- connection to friends and family. ...
- travel days. ...
- distance to things (mail, grocery, laundry)
Airstream. Some of the most durable travel trailers for full time living—and therefore some of the best RVs for full time living —are made by Airstream. These trailers have a unique look, and because of the way they're built, they are easy to tow and might even be more resistant to leaks than traditional RVs.How long do RVs last? ›
What is the average lifespan of a travel trailer? At a minimum, your travel trailer needs to be able to last for 10 years. You might be able to prolong its longevity and add about two to five years by taking good care of it. However, some travel trailers can last up to 30 years with proper usage.Can you live in an RV on Social Security? ›
The simple answer is YES! We know a lot of couples who do this. Full-time RVing on social security may even support a better lifestyle than living in a house.What is the 333 rule for camping? ›
So, recapping, the RV 3-3-3 rule broken down is to 1) drive no more than 300 miles each travel day, 2) arrive no later than 3:00 p.m. and 3) stay parked for 3 days. This RV driving rule helps to make your RV adventure safer. But also, you and your fellow travelers will enjoy the journey as much as the destination.What is the cheapest way to live in an RV? ›
The Cheapest Way to Live in an RV is Usually to Stay Put
If you currently put a ridiculous amount of your income toward rent or a mortgage, you might take a look at RV park rent costs where you live and think that RV living is cheaper. That is usually the case, but only for two groups of people.
Yes, in most states, the interest on your RV financing is tax-deductible. This is typically available whether your RV is your primary or secondary home, though some states may have their own requirements.Do RV prices drop in the winter? ›
However, strong evidence suggests buying RVs in the off-season (such as winter) could be much cheaper. In this case, cheaper could mean thousands of dollars. Industry insiders know that the sales of RVs trail off between October and January, which makes dealerships more motivated to make deals in the winter.Which FICO score is used for RV loans? ›
The answer is, it varies greatly. The RV financing industry-standard ranges from about 660 to 700 FICO score, but there is a possibility your search for “RV financing with 650 credit score” can be fruitful because there is financing available for credit scores in the 500 to 600 range.
What credit score is needed to buy a camper? ›
In order to qualify for the best RV loan rates, you should aim for a credit score of around 700 or higher. Of course, there are many lenders who also offer RV loans to those with bad credit.What is the debt to income ratio for an RV loan? ›
Most lenders that offer recreational financing will require that your debt to income ratio be less than 40%. You can calculate your DTI ratio by totaling up your monthly recurring debts (total of all of your monthly payments for installment loans and revolving loans), then divide that number by your monthly income.How good of credit do you need to finance a camper? ›
A credit score around 700 or higher will make it easier and faster for you to get an RV loan. If you have such a high score, lenders are likely to perceive you as low credit risk. Thus, you will get better and lower rates for your loan.How long does the average RV owner keep their RV? ›
The short answer is that the average lifespan of an RV is around 20 years or 200,000 miles, whichever comes first. But the answer isn't quite that simple. That number can vary depending on the class of your motorhome, how well you take care of it, and a few other factors.Do RVs hold their value? ›
Brand-new RVs start losing value as soon as they're driven off the lot and continue to lose value throughout the first year rapidly. The RV depreciation rate increases at a steady rate after that until your RV hits double digits in age. Once an RV is ten years old or older, its value drops more rapidly.Is it worth buying a 20 year old RV? ›
Is Buying an Older RV Worth It? If you want to save money on your RV purchase and don't mind the quirks that can come with older RVs, an old RV is definitely worth it. With research, planning, and proper RV inspection, you can get a great deal on a used RV that will last you for years to come.Will the price of RVs go down in 2023? ›
Based strictly on speculation, yes. If dealerships continue to have trouble moving motorhomes, then it's safe to assume prices should go back to what we would call “normal.” Better yet, as supply chain issues from the pandemic begin to straighten out, dealers are finding it much easier to replenish their inventory.Will 2023 be a good year to buy an RV? ›
The RV Lifestyle Is Plateauing, But 2023 Is Not a Good Time to Buy. There's no doubt about it: RVing is likely going to experience a downturn this year. But the effects of the switch don't necessarily mean great things for RV shoppers. Even if you're a savvy shopper, 2023 is not a good time to buy!Is buying an RV lot a good investment? ›
Generally, RV parks offer a higher ROI than most other types of commercial properties. According to most sources, you can expect anywhere from a 10% to 20% return on your initial RV park investment.What is the average monthly payment for a $20000 car? ›
The monthly payment on a $20000 car loan depends mainly on the loan term or the time taken for repayment and APR (Annual Percentage Rate). For example, if the loan term is 36 months and the APR is 4.12%, then the monthly payment will be around $591. If the loan term is 48 months, the monthly payment decreases to $452.
How much is a $20000 loan for 5 years? ›
A $20,000 loan at 5% for 60 months (5 years) will cost you a total of $22,645.48, whereas the same loan at 3% will cost you $21,562.43. That's a savings of $1,083.05.What is the monthly payment on a $300 000? ›
On a $300,000 mortgage with a 3% APR, you'd pay $2,071.74 per month on a 15-year loan and $1,264.81 on a 30-year loan, not including escrow. Escrow costs vary depending on your home's location, insurer, and other details.Is it cheaper to live in an RV than a home? ›
An RV costs less than many homes, though high-end vehicles rival the less expensive home prices in some areas. Living in an RV is typically cheaper than living in a house or apartment, but a lower start-up cost doesn't necessarily mean a lower cost of living overall.Is an RV a good investment to live in? ›
Is an RV a Financial Investment? The short answer is no. With the exception of some in-demand vintage models, the value of an RV depreciates over time. An RV is an investment in a lifestyle, but you can mitigate the expense by renting it out when not in use through a third-party rental site like Outdoorsy or RVshare.Can you realistically live in an RV? ›
Whether you plan to explore beautiful destinations or settle into a convenient park, RV living can be economical and satisfying. There are more than a million Americans who live in their RV full-time. Many say they are happier and that the full-time RV lifestyle has improved their relationships.Is it realistic to live in an RV? ›
Living in an RV has its moments, but it's not always easy. Moving an RV camper can be expensive and may cause wear and tear on your vehicle. You have little privacy when living in an RV, whether you're inside trying to sleep or outside trying to get some fresh air. Visit Insider's home page for more stories.