Buying your own caravan, either for travelling around with you family or even during retirement, can be a cost-effective way to see the country. While caravans can be expensive, there is financing available to you. Find out what you need to know about caravan loans in this guide.
NRMA Caravan Loan
NRMA Caravan Loan
5 hour pre-approval
No monthly fees
Extra repayments at any time
100% confidential application
NRMA Caravan Loan
You can borrow from $5,000 for a new or used caravan and get the funds the following day.
Caravan loans essentially work just like any other loan. You have a choice between an unsecured personal loan or secured personal loan that allows you to use your caravan as security. Not all lenders providing vehicle loans will allow this. If you opt for a secured loan you can take advantage of a lower interest rate, but unsecured loans offer more flexibility. Some loans have a fixed interest rate so your monthly repayments will be the same every month. Other loans have a variable interest rate, which may fluctuate, but the rate tends to be lower.
Types of caravan loans
Secured personal loan. Use your caravan as security and benefit from a lower rate. These loans can either be referred to as car loans or secured personal loans, but all come with similar features. If a lender allows you to use your caravan as security then you can benefit from the low rate, but keep in mind you risk your caravan should you default on the loan.
Unsecured personal loan. This loan allows for greater flexibility with your loan amount, so you can use it to purchase accessories for your caravan or even insurance. Unsecured personal loan rates are higher because the lender is taking on more of a risk.
Caravan financing from a specialist lender. Several specialist lenders operate in this space. Remember to check the reputability of these lenders before you apply.
What types of caravans can I purchase?
The road you’ve chosen to travel notwithstanding, there’s a caravan out there that can make travelling on it a pleasure. Find out more about what types are available below.
A full caravan is a conventional caravan with a full height roof and solid walls. It doesn't require any kind of setting up or packing down. These caravans car vary significantly in size, and while smaller ones are single-axle, the larger ones are double-axle. Full caravans find favour with many because they’re ready to go at all times, they offer adequate storage, and they can offer suitable protection from harsh weather conditions. Apart from getting a full caravan with air conditioning, you can also find ones with kitchenettes and home entertainment systems.
If you’re looking at keeping the size of your caravan small while towing, but want the benefit of extra space when required, getting a pop top or pop out caravan might be a good idea. These relatively small-looking caravans come with extra pop-out sections that you can use when you set up camp. The 'pop' can come out sideways, and some models even pop upwards to offer full height.
While travelling, such a caravan gives you a clear view of the road behind you and the pop-out section gives you the luxury of extra sleeping or seating space. These are considerably smaller and lighter than full caravans, are normally more aerodynamic, and can lead to lower fuel costs. One drawback is that you have to deal with reduced space while driving, so you can’t take as much with you.
Imagine a camper trailer turning into a caravan — this is essentially what a wind-up caravan does. Such a caravan extends quite like a pop-up caravan, but offers a significantly larger space. Such a caravan offers similar benefits as that of pop-out caravans, but their extra space can require more time to setup and pack down.
The main reason behind the popularity of teardrop trailers is that they are easy to tow. You can tow one using a sports car, a small classic car and even a trike. These small trailers are ideal for light travellers, and they come with very basic equipment in terms of bedding as well as cooking.
A typical fifth wheeler caravan is larger than a traditional full caravan. It also offers more a higher level of luxury and many view them as mobile homes. For instance, fifth wheeler caravans tend to make use of real furniture as opposed to fixtures. Such a caravans come without a conventional caravan hitch, so you have to articulate a towing connection on its bed, and to tow one you require a ute or a pickup truck. One drawback is that a fifth wheeler caravan is classified as a Big Rig. This means you cannot access all campsites and roads, so you'll require meticulous planning for your trip.
An RV (recreational vehicle) is another name for a motorhome, and this is essentially a caravan that also doubles up as a vehicle. A motorhome does not require any setting up; you can simply decide to leave, pick your keys and leave. They can offer extra space in the form of pop-out sections and can come with a variety of equipment and fixtures. The size of an RV can be a drawback at times, especially if you want to go sightseeing. One option is to tow a small car with your RV, but you need to establish if it’s worth the trouble.
How should you compare your caravan loan options?
Find out the interest rate. Interest rates for caravan loans tend to be quite competitive, but it’s still important to use interest rates as a comparison point as this is where you can potentially save a lot of money. Decide whether a fixed or variable interest rate is right for you and go from there.
Will the loan be secured or unsecured? Caravan loans can either be secured or unsecured. Unsecured loans can have less risk but they often have higher fees to compensate for this risk. Choose whether you want a secured or unsecured loan and then compare fees and charges once you have made your decision.
Are you given flexible repayment options? Most caravan loans tend to have flexible loan repayments but some are better than others. The can offer fortnightly or monthly repayments by BPAY or direct debit, so choose a loan that offers convenient options.
See what loan terms are on offer. The term lengths of caravan loans vary depending on which financial provider you go with. The amount of money you borrow will influence the term length but it’s also recommended you have a rough idea of how long it will take you to repay the loan before agreeing to anything.
What to avoid with a caravan loan
Watch out for over-committing to a high loan amount. Ensure that you’re not borrowing more than you can afford to pay back before you take out a caravan loan. It’s also important to not get yourself into too much debt. If you are currently in debt, it’s strongly recommended that you don’t take out another loan and instead consider your other options first. Continuously borrowing money is a very dangerous move.
Any hidden surprises in your contract. Just like with any other loan, you will be required to commit to a contract. Make sure you carefully read through your contract before committing to it so you aren’t hit with any unexpected charges
Checklist for buying a camper trailer
The "different strokes for different blokes" saying holds true even when it comes to camper trailer shopping, given that just about every camper has unique requirements. Find out what aspects need your attention:
Chassis. The chassis of a trailer plays a crucial role in holding it together, and for increased life look for a chassis made using high-quality materials. If you plan to carry heavy loads of if you’re thinking about driving off-road, look for an extra strong chassis.
Suspension. Suspension springs should be strong enough to take the weight of the trailer as well as of the load that it carries. Make sure you pay heed to their condition at the onset, and find out if they’re suitable for off-road driving.
Tailgate and doors. Remember to check all seals, not just on the doors and the tailgate but also on all compartments and even the tool box to avoid damage from water and rust.
Towing. The towing coupling should have enough strength to take the camper trailer’s weight as well as all that it carries. For off-road driving, getting a coupling that turns 360 degrees is ideal. In addition, consider getting snatch points at the trailer’s rear section.
Protection. Camper trailers tend to flick up stones from time to time, and this can even happen on paved roads. Some trailers work in deflecting these stones by using built-in stone guards, and some come with shade cloth attachments to bridge the gap between the trailer and the car.
Tyres. If you can manage to get the same set of tyres on your trailer as on your main vehicle you can look forward to a smoother drive.
Trim. The canvas your camper trailer uses should be durable, given that it provides shelter, but remember that lightweight canvas is quicker and simpler to set up. Check for waterproofing and mildew-proofing of all canvas and awnings, and make sure they don’t have any holes.
Bedding. Ensure there’s enough room for everyone who might use your trailer, and don’t hesitate to take measurements of bedding if it looks small.
Possible add-ons. While the list of add-ons can be very long, most camper trailers tend to include water tanks, jockey wheels, and awnings, so it makes sense to look for these in your purchase.
How to start your application for a caravan loan
If a caravan loan sounds like it’s right for you, applying for one is very easy. All you need to do is use the comparison table on this page and compare the caravan loans available. Look at all your different options and when you find one that’s right for you, simply click the 'Go to site' button and go through to the lender’s website. Once you’re on the website it’s as easy as completing your application form online and then waiting to hear if you get approval for your caravan loan.
Typically, to be eligible for caravan finance you must be at least 18 years of age. You must also have a good credit rating and be able to demonstrate this to the provider with evidence such as bank statements, payslips and copies of other credit contracts. Other loans may also require you to be an Australian resident/citizen or already be a member of the financial institution.
What documents will I need for my caravan loan?
Your application will run much smoother if you have all your documents ready and available when you apply for your caravan finance. You will need:
Drivers licence, Medicare number
Payslips or proof of income
Confirmation of your address
How much can I borrow for my next caravan?
Use the calculator below to work out how much you could borrow and what your repayments might be.
Frequently asked questions about caravan loans
Do I need to pay stamp duty for my caravan?
Generally caravans are exempt from stamp duty, but you’ll need to confirm this with your Office of State Revenue as it is dependent on the state you live in.
Can I get pre-approval on my caravan loan?
The majority of blenders will offer you pre-aprroval on your caravan loan. This can help your bargaining power when dealing with the sales manager when buying your next caravan
Matt Corke is the head of publishing in Australia for Finder. He previously worked as the publisher for credit cards, home loans, personal loans and credit scores. Matt built his first website in 1999 and has been building computers since he was in his early teens. In that time he has survived the dot-com crash and countless Google algorithm updates.
You'll receive a fixed rate from 5.69% p.a. A larger loan of $5,000 or more to help you buy a new or used car. 5-hour pre approval available and no ongoing fees. Note: Product only available to residents of Victoria.
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