Advertiser Disclosure

Auto Loan

RV Buying Tips: Get the RV of Your Dreams

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

RV buying tips
Getty Images

Ever dream of buying an RV? You’re not alone — about 10 million households in the United States already own an RV.“The popularity of RVing is at an all-time high because of the freedom and flexibility RVs offer,” said Kevin Broom, director of media relations at the RV Industry Association (RVIA). “With the same RV, people can take an array of trips, spend time having adventures with friends and family and form memories that will last a lifetime.”

When shopping for a unit, you’ll need to consider what type of RV suits your needs, how much time you plan to spend in the RV, whether you want to buy a new or used unit (or lease an RV) and how you plan to pay for it. This article will explain the costs of owning an RV, as well as how you can get your best price.

The costs of an RV

RVs have a huge range of prices, which vary depending on size, style and other factors, said Broom. As of the date of publishing, here are some estimates for a variety of new RVs, according to the RVIA:

  • Folding camping trailers: $6,000 to $22,000
  • Truck campers: $6,000 to $55,000
  • Conventional travel trailers: $8,000 to $95,000
  • Fifth wheel trailers: $18,000 to $160,000
  • Type B and C motorhomes: $60,000 to $150,000
  • Type A motorhomes: $60,000 to $500,0000

You may be able to save some money by opting for a pre-owned RV instead of a new one, added Julie Bennett, who, along with her husband Marc Bennett, authored the book “Living the RV Life: Your Ultimate Guide to Life on the Road,” and run the RV Success School.

“We have met people who spent less than $5,000 on their RV, and others who spent over $1 million,” said Marc Bennett. “Most of the people we have met that do extended travel in their RVs typically spend between $50,000 and $150,000 on their RV setup, which includes the cost of the truck and trailer, or a motorhome plus the vehicle that they tow.”

You generally don’t need a special license to drive or tow an RV, said Broom, but it’s not a bad idea to look into the laws in your state, especially if you’re buying a very large trailer or motorhome.

The RV, as well as the truck and trailer if the RV needs to be towed, is just one of the costs to consider. You’ll also need to budget for maintenance and repairs, taxes, insurance, vehicle registration, fuel and storage. These expenses can vary from state to state.

There are also an array of optional (though potentially desirable) add-ons, like roadside assistance and extended warranties, that can increase the bottom-line costs of RV ownership.

“RV dealers will try to upsell you on things like paint protection and other options you may not really need,” said Marc Bennett. “You’d be surprised how much all of this can add up, so do your homework in advance and know what you are getting yourself into before committing.”

What kind of RV should you buy?

One of the first things to consider when figuring out which type of RV you should buy is how often you intend to use it.

“If you only plan on RVing a few weeks a year for short vacations, it really doesn’t make sense to spend a whole lot,” said Julie Bennett. “If you’re planning on using your RV for extended travel or even live in it full-time, then it’s easier to justify a bigger investment.”

Here are some other questions you should ask yourself when shopping for an RV:

  • Who will be traveling in the RV? A couple of retirees who are OK roughing it on the road might opt for a travel trailer, while a large family with pets may be better off with a camper van or motorhome.
  • Where do you plan to take the RV? Julie Bennett suggests that potential RV owners think about whether they want to stay in campgrounds with hookups for electricity, water and sewage, or camp off-grid in more remote places, and find an RV that fits those needs.
  • Do you need a special license for the RV? Large trailers or motorhomes may require a special license in certain states, said Broom.
  • What “toys” are you bringing in your RV? You may need to splurge on a larger RV or motorhome if you plan to take bikes, ATVs, kayaks and other recreational gear on your adventures.
  • Does the RV have a floor plan and layout that makes sense for you? “Pay attention to the things you will use most often,” advised Julie Bennett. “Is there sufficient counter space in the kitchen for making meals? Can you fit inside the shower and wash your hair?”
  • How far will you take the RV? If you want to keep costs in check on long-haul trips, you might need to pay more attention to things like the weight and aerodynamics of the RV. You should also consider whether you want a diesel or a gas engine. Gas engines generally don’t get as much power or as efficient mileage as their diesel counterparts, but they tend to be less expensive.

Should you buy a new or used RV?

Every future RV owner is faced with one big question: Should you buy a new or a used RV? Here are some pros and cons to consider.

Pros and cons of buying a new RV

Pros

  • You know the history of the RV. Buying a new RV means you don’t have to worry that a previous owner cut corners on care and maintenance.
  • You can personalize the RV. “Some may like that they can choose their floor plan, layout, decor, color scheme and options, and some may want the latest technologies,” said Marc Bennett.
  • You can avoid potential allergens. Does your child have a severe peanut allergy? There’s no guarantee a used RV doesn’t contain peanut residue from a previous owner, so you might be safer buying a new one.

Cons

  • You’ll probably pay more. “Not only will you pay more for new, you will also see the sharpest dip in depreciation as soon as you drive it off the lot,” said Marc Bennett.
  • You still may need to make repairs. Just because you’re buying a new RV doesn’t mean it will be trouble-free. “RVs are very complex, and built by hand in relatively low-tech facilities,” he added. “Once new RVs leave the dealer’s lot, they tend to need more repairs and fixes — much like a punch list on a new house build.”

Pros and cons of buying a used RV

Pros

  • You’ll probably save money. The older an RV is, the more of an effect depreciation will have on its price tag, said Julie Bennett.
  • It’s already broken in. The problems associated with a brand new RV may have already been taken care of by a previous owner, which could save you time and money on repairs.
  • It might come with extras. People often include extra items when selling their RVs, said Julie Bennett. You may luck out with an upgraded suspension, RV gadgets or kitchenware at no additional cost.

Cons

  • It comes with risks. If the previous owner didn’t maintain an RV properly, it may need new parts or repairs.
  • You may need to renovate it. If an RV’s aesthetics are dated or simply unappealing, it’s on you to fix it up.
  • It probably won’t have a factory warranty. You may need to shell out for repairs right away before you can drive the RV, said Julie Bennett.

Where can you buy an RV?

There are a variety of places to buy an RV — and according to Marc Bennett, you may need to travel far to find the right one at the right price: “We traveled thousands of miles when buying our first RV. Opening up geographically allows for much more selection,” he said.

Here are some of the places you can start your search for an RV:

  • New RV dealerships: Looking to buy a new RV right off the lot? Then shopping at a new RV dealership might make the most sense. “Buying from a respected dealership might provide some peace of mind that they have checked the unit and it is ready to go,” said Marc Bennett.
  • Used RV dealerships: Used RV dealers might not know as much about the history of a particular unit as its original owner. However, you may be able to purchase an extended warranty for some added protection.
  • RV shows: RV shows offer the opportunity to see a wide variety of models in one place. Should you find the unit of your dreams at an RV show, you may be able to score special discounts.
  • Private sales: Buying a used RV directly from its owner allows you to learn more about its history, maintenance and unique quirks, said Marc Bennett. “An owner will be able to share much more detailed information about the specific RV than a dealership,” he added.
  • Online marketplace: Do you already know exactly what you’re looking for in an RV? An online marketplace could help you find it quickly. RVTrader.com and Craigslist are popular places to find private RV sales online, said Broom.

How do you get your best price on an RV?

The price tag on an RV can give you serious sticker shock. Luckily, there’s lots of room for negotiation, and you should not plan to pay the asking price, noted Marc Bennett.

“There’s no hard and fast rule about how much discount you can get on an MSRP [manufacturer suggested retail price],” he said, “but it is not uncommon to buy a new RV for 15% to 30% off the MSRP.”

Going into the negotiation armed with knowledge can help you get your best price on RV, added Julie Bennett.

“Get a few price comparisons on the RV you want to buy,” she said. “Know what questions to ask, know [what’s] a fair price for the RV you want, and keep an eye out for deals at certain times of year,” also noting that you may be able to get the best price when a dealer is clearing out old models to make room for new units.

If you can’t afford to pay cash, you may be able to take out an RV loan or secure other financing to make the purchase. Here are some ways to finance your RV:

  • Dealership financing: Dealerships may offer financing through lending partners (such as a bank or credit union), or offer in-house financing. This is convenient, as you can get your RV and your loan all in one place. However, dealers may use this type of financing to bolster their bottom line, so if the rate offered isn’t competitive, you might find a better offer somewhere else. Additionally, dealership in-house financing, which is usually offered to people struggling to find financing elsewhere, can carry high interest rates.
  • Banks, online lenders and credit unions: You may be able to secure an RV loan from an online lender, credit union, bank or other financial institution. Since dealers may not have partnerships with lenders you’re interested in, you may need to seek out quotes directly from the institutions themselves. Make sure to shop around to compare offers. Though credit unions may have lower rates, you’ll need to become a member.
  • HELOC or home equity loans: You may be able to use a home equity line of credit (HELOC) or a home equity loan to secure the funds for an RV. With both of these options, you’re borrowing a portion of your home equity. Keep in mind that you’re putting your home on the line with this type of financing, so make sure you’re on firm financial footing before moving forward. However, because the loan is backed by collateral, interest rates tend to be lower. With either option you’ll also need to pay closing costs, a process that can take several weeks or longer.

The bottom line

RVs offer the freedom to travel the country on your terms. Whether you dream of a life on the road or you’re just looking to spend a couple of weeks in the great outdoors every summer, you can get an RV to make it happen.

Remember: There’s no one-size-fits-all solution to finding or financing the RV of your dreams. Do your homework, know what you’re looking for and don’t be afraid to walk away from a bad deal. The right RV is out there waiting for you — and with enough legwork, you’ll find it.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Joni Sweet
Joni Sweet |

Joni Sweet is a writer at MagnifyMoney. You can email Joni here

Advertiser Disclosure

Auto Loan

Navy Federal Credit Union Auto Loan Review

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Getty Images

If you are shopping for an auto loan, it’s helpful to get quotes from multiple lenders to ensure you receive the lowest possible interest rate and most favorable terms. For members of the military and their families, Navy Federal Credit Union could be an option.

Here’s what we found out about Navy Federal Credit Union and its auto loans.

About Navy Federal Credit Union

Navy Federal Credit Union, which was founded in 1933 and is headquartered in Vienna, Va., serves the military community. Its “once a member, always a member” policy means that you can continue to use the credit union if you or your family member leaves the military.

The following groups are eligible for membership:

  • Active-duty members of the Air Force, Air National Guard, Army, Coast Guard, Marine Corps and Navy
  • Delayed Entry Program (DEP) enlistees
  • Department of Defense officer candidates/ROTC participants
  • Department of Defense reservists
  • Veterans, retirees and annuitants

Parents, grandparents, spouses, siblings, children and grandchildren in a military family are also eligible, as are household members. Department of Defense civilian employees can become members, too.

Consumer Financial Protection Bureau action against credit union

It’s important to note that in 2016 the credit union was ordered by the Consumer Financial Protection Bureau, or CFPB, to pay $28.5 million after an investigation found that, among other things, it was improperly restricting account access for members with delinquent loans. The CFPB accused the credit union of making false threats of legal action and wage garnishment, threatening to contact delinquent members’ commanding officers and lying about the consequences of falling behind on loan payments. Of that total, $23 million would go to victims who received threatening letters. The credit union was required to correct its debt collection practices.

Navy Federal Credit Union: At a glance

When shopping for an auto loan, it’s crucial to get several quotes, no matter your credit score. If you have an array of loan options, you’ll have more negotiating power with a dealership.

APRs

APRs for Navy Federal Credit Union auto loans, which are based on creditworthiness, currently start at 2.99%.

Here’s a breakdown of APRs based on the type of vehicle:

  • New vehicles: 2.99% to 6.29% for loan terms between up to 36 months and 96 months
  • Late-model used vehicles: 3.29%* to 4.79%* for loan terms between up to 36 months and 72 months
  • Used vehicles: 4.99% to 6.29% for loan terms between up to 36 months and 72 months

Used vehicles older than 20 years are paid back at a collateral loan APR, which can be between 8.09%* and 8.9%* for loan terms between up to 60 months and 180 months. Preapproval isn’t available for this type of loan.

Your rate could be higher, depending on your credit profile and the value of the vehicle.

Active-duty and retired military members may be eligible for an additional discount with direct deposit to a Navy Federal Credit Union account. To get the discount, call or visit the credit union.

Vehicle requirements

Navy Federal Credit Union has specific vehicle requirements for its auto loans. For new vehicles, the minimum loan amount is $30,000 if seeking a term of 85 to 96 months. Used vehicles are 2017 models or older, or any model year with more than 30,000 miles. Late-model used vehicles can be model years 2018 to 2020 with 7,500 to 30,000 miles.

Boat, motorcycle and RV loans

The credit union also offers new and used boat, motorcycle and recreational vehicle (RV) loans. These loans only apply to recreational vehicles, so full-time RVs aren’t eligible. Here’s a breakdown of APRs based on the type of vehicle:

  • New boats: 6.05%* to 8.75%* for loan terms between up to 36 months and 180 months
  • Used boats: 8.05%* to 9.2%* for loan terms between up to 36 months and 180 months
  • New motorcycles: 7.25%* to 8.6%* for loan terms between up to 36 months and 84 months
  • Used motorcycles: 8.09%* to 9.35%* for loan terms between up to 36 months and 72 months
  • RVs (collateral loans): 8.09%* to 8.9%* for loan terms between up to 60 months and 180 months

These rates are based on creditworthiness, so your rate may be higher.

As with auto loans, there are specific requirements when it comes to boats, motorcycles and RVs. Check with the credit union for details.

Refinancing

Navy Federal Credit Union also offers auto loan refinancing.

Here’s a breakdown of APRs based on the type of vehicle:

  • New vehicles: 2.99% to 6.29% for loan terms between up to 36 months and 96 months
  • Late-model used vehicles: 3.29%* to 4.79%* for loan terms between up to 36 months and 72 months
  • Used vehicles: 4.99% to 6.29% for loan terms between up to 36 months and 12 months

Members may be eligible for $200 cash back 61 to 65 days after completing their first scheduled payment when refinancing from another lender.

A closer look at Navy Federal Credit Union auto loans

Highlights of Navy Federal Credit Union auto loans

A down payment isn’t required to get a Navy Federal Credit Union auto loan, but making one could improve your loan-to-value ratio, which could boost your chances of getting approved.

If you have a limited credit history, you may still get approved with a co-applicant.

You could get a decision about your application in just a few minutes. The credit union offers preapprovals, so you know how much money you can spend on your vehicle before you start shopping. If you get preapproved, your rate will be locked for 60 days.

The credit union offers an auto buying program, through a nationwide network of dealers, as a straightforward way to buy a new or used car. You can even get special military prices if members need to buy a new car while overseas.

You can get optional guaranteed asset protection (GAP) insurance for existing or new auto loans through the credit union. It also offers some discounts on GEICO auto insurance, depending on your state of residence.

Lowlights of Navy Federal Credit Union auto loan

If you don’t have ties to the military, you won’t be able to access Navy Federal Credit Union’s services, including its auto loans.

If you are approved for an auto loan, you must either pick up your check in person at a branch or receive it via mail. There may be a fee associated with mailed loan checks. If you had a co-applicant with a different mailing address, the check and promissory note will be sent to them. Some applicants may find this inconvenient, especially if their co-applicant lives far away.

On the credit union’s website, minimum interest rates are noted in detail for used vehicles, new vehicles, boats, RVs and motorcycles. The website, however, doesn’t note its maximum interest rates or discuss specific credit requirements for auto loan approval. The credit union did not respond to emails requesting this information.

How to apply for a Navy Federal Credit Union auto loan

To apply for an auto loan from Navy Federal Credit Union, you’ll first need to become a member. You can apply at a branch or online, and you won’t be charged an application fee.

Make sure to gather contact information for both you and your co-applicant, if you have one. If you’ve picked out the vehicle you want, you’ll need its 17-character vehicle identification number (VIN), the state where it will be registered, the dealer or seller’s name and the mileage reading on the odometer.

If you don’t have a specific vehicle in mind, you’ll need an estimate of the type, age and price of the vehicle you want to buy, including the warranty, title, tax and license fees minus the down payment. You’ll also need to know about how long of a loan term you’d prefer.

The credit union requires personal information, including employment and income details for both you and your potential co-applicant. It’ll ask for your current housing information, too. The credit union already has identity information about its members, and it’ll base its decision on your credit history, the amount of money you want to borrow and the value of your collateral.

You’ll receive a text or email from the credit union to let you know whether it approved your application. Most applicants get a decision in about five minutes.

The fine print

Navy Federal Credit Union’s website doesn’t indicate whether it charges any additional fees for auto loan borrowers. The only fee mentioned is the one that the credit union may charge to mail a physical check to an applicant or co-applicant, as mentioned above.

Who is a Navy Federal Credit Union auto loan best for?

The credit union is a great option for people with ties to the military who want to work with a credit union that has friendly policies and decent interest rates.

Like many credit unions, this one offers competitive interest rates for those with good credit. Even if you are already a member and know you’ll apply for an auto loan with this lender, it’s still important to shop around for the best rates so you can be sure you are paying the lowest possible amount for access to the money you need to buy a car.

*Rate accurate as of August 22, 2019

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Rachel Morey
Rachel Morey |

Rachel Morey is a writer at MagnifyMoney. You can email Rachel here

Advertiser Disclosure

Auto Loan

Buying a Car: When to Walk Away

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Walk away from car deal
Getty Images

Buying a car can be a stressful experience for anyone. For some of us, the anxiety begins before we start negotiating financing or even step foot onto a car lot. But no matter how eager you are to get the experience over with, or how persistent a salesperson is, you should never buy a car without being certain it’s right for you. Ron Montoya, consumer advice editor for Edmunds, says that dealerships are good at applying pressure. “There’s always a sense of urgency that ‘today is the best day to buy the car,’” he says. “While that may be true for the seller, it’s not always the case for the buyer.”

What are the warning signs that you should walk away from a car deal?

Interacting with a salesperson who’s been trained to haggle and close the deal might leave you feeling outwitted. Some level of stress is normal, but these are the real red flags to look out for:

Prices change after your initial negotiations.

For example, the online price you were promised has changed once you walk into the dealership or your trade-in value is lower than what you discussed or your monthly payments are higher once you sit down to review any paperwork. You should also look out for add-ons you didn’t agree to, like an extended warranty or a “service contract” that increases the overall price tag. Montoya says it should be a deal-breaker when written terms don’t match what you discussed.

The contract isn’t final.

It’s easy to assume that signing a contract means your deal is final, but some dealers include contingencies, including “spot deliveries” that might be “yo-yo transactions” meant to intentionally deceive buyers.

If your contract states, for example, that your financing isn’t final, you may be asked to come back later and get a different loan with worse terms, for the car you’ve already taken home. If the dealer won’t state in writing that your financing is final, they may be breaking the law. This is a definite sign that you should walk away.

You’re being pressured.

Brent Miller, executive director of a community center in San Francisco, recently shopped for a new car. Miller says despite visiting a reputable dealership for his purchase, the salesperson repeatedly pushed him to make unwanted decisions. “It was amazing how much pressure there was to sign the contract without reading everything, even before I had a loan offer,” Miller says.

If you’re encouraged to buy a different car than the one you’re shopping for, or to close the deal without looking over the numbers, Montoya says you should walk away.

The seller is withholding information.

It’s a red flag if your salesperson gives unclear information about pricing and loan terms. If you can’t get a straight answer on what your monthly payment will be, the length of your repayment term or your interest rate, you shouldn’t sign a contract. A good tip is to keep your focus on the out-the-door price of the car — if you get the lowest price possible, a good monthly payment should follow.

Discriminatory practices

If you feel a dealer is attempting to take advantage of you based on your citizenship status, income or other factors, you should go elsewhere. One way dealers do this is by marketing to you and conducting negotiations in your first language and then offering you a contract in a different language, with higher fees. Regardless of the circumstances, never sign a contract if you’re unsure what it says.

How do you negotiate in “good faith?”

Like most things in life, a bit of preparation can go a long way. Here are some of the ways you can reduce your risk before approaching a dealership or private seller when buying a car:

Review your budget and credit

Doing your financial homework can help you determine what price range is truly affordable for you, instead of letting a salesperson decide. Loan payment calculators can also help you get a realistic view of affordability by taking interest rates and fees into account.

Get loan preapproval

Another factor in determining affordability is the amount of financing you get approved for. Having a loan preapproval from your bank or credit union, before visiting a dealer, has several benefits: it sets realistic expectations about the maximum sales price you can shop for and helps you avoid more expensive or even potentially predatory dealer financing. If the dealer can beat your preappoved loan offer either through one of its lender partners or through the manufacturer, you’ll know you’re getting the best deal possible.

Research market prices

Montoya, who purchases fleet vehicles for Edmunds, an auto industry research firm which tests cars, says the best way to prepare for a purchase is to understand the market price of the car you want. You can do this by looking up values through sites like Kelley Blue Book or Edmunds, checking out a variety of ads and car-buying websites, and even by getting a few price quotes, so you can compare them to the offers you get from a dealership.

Research promotions

Having a sense of manufacturer and dealer promotions can not only help you narrow down which models to buy and which lots to visit in your area, but it can also help you understand if the dealer is truly offering a “one day only” sale, or if it’s just a tactic to pressure you into buying.

How to walk away from a car deal

So you’ve attempted to negotiate a deal with no luck, or you’re simply uncomfortable with the transaction. You may be tempted to give into the pressure after spending a whopping three hours at a lot, which is the average amount of time buyers spend, according to a 2018 Cox Automotive study. But it’s completely within your rights to walk away at any point before, and in some cases even after you sign your contract.

During negotiations

At this point, walking away is as simple as putting one foot in front of the other. Montoya advises that even if the dealer already pulled your credit information, you’re still under no obligation to stay. While you may be concerned about the hit to your credit, know that making multiple auto loan applications within a short period of time will have a small impact on your scores.

If you’re having trouble ending the negotiations, Montoya suggests shutting down persistent salespeople by shifting the blame to someone else, like your spouse…even if you’re not married.

Whatever your explanation, walking away or telling the dealer you’re going to shop around is perfectly acceptable. If you really are interested in buying the car, walking away may also be a useful negotiation tactic.

Once you’ve seen the contract

Regardless of the time and effort invested by both parties, you are under no obligation to sign any contract you’ve been presented. At this point in the process you can still simply say “no” to the dealer.

After signing the contract

If you sign a contract and drive away with a car, but then get called back based on a contingency, you may be able to walk away from the deal.

If you’re called back because financing fell through, you can demand to get your down payment back and unwind the entire transaction. To complete the process you’ll need to make sure that the application and contract are cancelled and that you get copies of all the documents.

If, on the other hand, you simply wish to return the car because you’ve changed your mind, your options may be limited. Some state laws may allow you to return your car if you discover it’s a lemon, but contrary to popular belief the “cooling off period” unfortunately doesn’t apply to cars.

In some circumstances you may have a special option to cancel, particularly when it comes to buying used cars. New York state law, for example, gives you a set amount of time to file paperwork and cancel your contract. Your dealer may also have a special clause that gives you time to reconsider and return your vehicle. But if neither your state nor your contract stipulates that you can cancel, your best shot is to ask the dealer to give special consideration to your case.

The bottom line

The best way to avoid a bad deal is to be your own biggest advocate. Educating yourself about market prices, understanding affordability and researching consumer protections in your state, all before you talk to a salesperson, can help you stand up to pressure and recognize red flags quickly.

Ultimately you shouldn’t be afraid to walk away, no matter how difficult the dealer makes it to leave. Both the car and the financing have to work for you. “I want people to buy a car when its right for them and do it on their own time,” says Montoya, “not a dealership’s time.”

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Sarah Brady
Sarah Brady |

Sarah Brady is a writer at MagnifyMoney. You can email Sarah here