At ACF Direct, we are pleased to be able to assist you if you are looking for motorhome finance.
Over a long period of time, we have therefore picked up a lot of useful tips relating to motorhome finance and the generalities of purchasing these wonderful vehicles.
We’d like to share some of those with you here.
At the risk of stating the obvious, it’s important to be clear in advance on the principles of how you plan to pay for your motorhome (i.e. your motorhome finance) and what might be affordable.
It’s not unusual for motorhome buyers to use things such as cash lump sums withdrawn from their pensions or unexpected windfalls to fund this new major leisure-related acquisition. That’s fine but do keep in mind that if you need cash quickly in an emergency, it may take time to free it up if it is all invested in a motorhome.
So, it may be sensible to think whether it makes sense to use your cash reserves for an outright purchase.
Once you consider that in principle, you also need to have some thoughts about overall affordability. Remember that buying a motorhome will involve not only you finding the cash to purchase it (or for a deposit if you are going to use motorhome finance) but also the money to use it and enjoy it.
Motorhome finance options
Very broadly speaking, if you decide to use finance as opposed to your own cash, you are likely to be facing two probable options:
- seeking a loan from a bank (or elsewhere) so that you can buy it outright;
- using and eventually purchasing it based on some form of hire purchase agreement.
It is extremely difficult to generalise in terms of bank loans but the banks today may be cautious about lending large sums for what they may consider to be “luxury purchases”.
If you do follow this route, you’ll typically need to find a fairly chunky percentage of the overall price by way of a deposit and you may find that the bank will require time to investigate your financial standing and consider the proposed purchase.
Hire Purchase (“HP” as it is commonly known) is likely to be familiar to most people.
In summary, the process typically involves:
- you finding a vehicle you are interested in and at a price that makes sense against market norms;
- it will also be necessary for you to find a percentage contribution from your own financial resources. This is commonly called “the deposit”;
- a potential provider of HP funds will then consider your application. If the price of the vehicle makes sense against industry-standard price lists then they will go to the next stage;
- that next stage will typically involve some basic credit history check to ensure that you are someone who conducts your financial affairs in a responsible fashion. Note that even if you have some hiccups on your credit history files, that might not stop you from securing HP funding;
- it will also typically be necessary for you to give some indication of your overall financial position so that the funds provider can satisfy themselves that you will be able to afford the repayments;
- If all is well, they will purchase the vehicle in their name and you will be allowed to use it as the “registered keeper”, paying a monthly sum for doing so. Once you make your last payment, the vehicle becomes legally yours, as the funder transfers title;
- until that above point is reached, you must not sell the vehicle, as it is not your property.
If you’d like to know more about how you may be able to cost-effectively translate your dreams into reality is in this area, why not contact us for an initial and entirely non-committal discussion?