Five Tips for Getting an RV with Bad Credit
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Having bad credit isn’t the end of the world, but it certainly makes living in this world that much harder. A credit score is used by lenders to determine the trustworthiness of borrowers prior to approving their application. We specialize in repairing bad credit so that you can live life the way you want.
Having a score under 600 can make it difficult, if at all possible, to be approved for things such as auto loans, student loans, mortgages, credit cards, and so much more. It can even have an impact on things such as renting an apartment.
The reaches of your credit score are nearly infinite and it can be frustrating dealing with a low score. But don’t think that you will your be restricted from everything.
If you have ever wanted to explore the country in an RV, there is good news: a bad credit score won’t stop you. It won’t be as easy as it would be with a great credit score, but it doesn’t mean that you are precluded from owning an RV.
So, how can you still get an RV even with bad credit? Here are five tips that will have you cruising across the country in your new RV.
1. Be Organized
Hopefully you didn’t decide at the spur of the moment to head out and find an RV because a little foresight will go a long way. Even if you do have very good to excellent credit, you should realize that buying an RV is a serious investment.
Take the time to research the cost of the RV that you are looking for. Not only at the total cost of the RV, but what it will cost to maintain it, as well as the down payment that will be necessary. Even if you don’t think a cost is likely, add it in so that you can cover all of your bases.
Also, know what your income is and what you can afford. Be honest about your income, too. A good rule of thumb when creating a budget is to understate your income while overstating your expenses. Doing this means that you can cover the worst-case scenario and you’ll definitely be able to afford the actual expenses that aren’t rounded up.
2. Start Saving
If you plan on purchasing an RV with bad credit, you can offset the issues created by that bad credit score by having more money up front. That means having a sizeable down payment up front. Having that down payment puts you in a better position to be approved and to obtain a better rate since you will be borrowing less.
Do your homework. Find out what a normal down payment is for the RVs that you are taking into consideration. From here, you can make a budget for saving for that RV. Think about putting aside some of your weekly paycheck; this is how you can accumulate enough for a down payment.
Be mindful of your bills, too. Maybe there are things that you can go without that will allow you to save more money toward your RV. Ultimately, be certain that you can still afford your bills without putting yourself into a difficult position and you will be able to begin saving toward that RV down payment in no time.
3. Try to Pay Down Credit Balances
People don’t get into poor credit situations overnight and they don’t get out of them overnight, either. But even establishing a positive recent credit history can go a long way. If you are currently carrying balances on your credit cards, consider the impact that they will have.
FICO expects good accounts to have a 30% credit utilization or less. This means that of all the open credit lines that you have – mostly credit cards – you are using 30% or less of that amount. So, if you have $10,000 in credit lines, you need to be using $3,000 or less.
Even if you have not been making your payments, it isn’t too late to turn things around. People run into trouble paying their credit cards all the time. If this is something that happened to you, don’t just ignore the issue.
Give your credit card company a call. Explain the situation and see if there is a way to renegotiate your monthly rate. Making any kind of payment will look good on you in the end, so take all of the necessary steps.
If you are in a position to pay off any of your cards before purchasing an RV, that is the best path to take. Having zero balances on your cards not only keeps you under your credit utilization limit, but also lessens your monthly burdens, too.
Having your credit cards in good standing, with low or no balance, and with a positive payment history will all put you in a better position to get the RV that you want.
4. Know What You Want Out of Your RV
When shopping for an RV, keep in mind that they are not all the same. Much like a regular car, there are base models and then there are models with all of the bells and whistles. It goes without saying that there is a cost difference between the base models and the ones with everything included.
The difference between cars and RVs is that these can be major upgrades. A decked out RV can include things such as a shower, a huge dining area, and fairly large bedrooms. It would probably surprise you how many possible upgrades there are for an RV.
Before knowing what you are going to spend or even picking out an RV, you should know what you want out of the RV itself. Perhaps you are using the RV to take a cross-country road trip; you will need a shower, kitchen, and a space to sleep.
These details can add up very quickly and that means additional costs. It all comes back to planning ahead. Do your research, know what you want, and know what it will cost. The less surprises that there are, the better you are able to plan ahead and the better your budget will be.
If your budget is on the limited side, consider making some realistic compromises. Maybe getting the best of amenities isn’t realistic for your budget. The goal is creating financial flexibility while still getting the RV that will fit your needs.
Take your time, have patience, and know exactly what you want. This is what will keep your budget where it needs to be and it will keep you in good financial standing.
5. Use a Tax Refund
Each spring, tax time comes for us all. For some of us, that can mean a sizeable tax refund that leaves us flush with cash. This would be an ideal situation for purchasing the RV that you have been eyeing. Of course, it’s not the only way to go about it.
You could use your refund to pay down some of your credit card bills and loans to put yourself into better financial standing. Also, there are possible tax breaks when it comes to purchasing an RV. For instance, the IRS might allow you to consider it as a second home.
The key is to look into every possible avenue before making a move for an RV. If there are no tax breaks available and you just have to have that RV, consider putting your refund into the down payment. Even if you can’t pay the RV off outright, paying off a majority of that RV can put you in a much better position to afford the monthly payments.
Having a bad credit score doesn’t have to keep you from living out your dreams. It certainly doesn’t have to keep you from owning an RV, either.
The key to owning an RV with bad credit is to plan ahead. Know what you want out of your RV, know what your income truly is, and know what your actual budget is. Far too many people ignore smaller items each month, failing to realize just how much those totals add up to.
Even if you have bad credit, there are ways to improve it in the short-term. Maybe hold off on that RV purchase for just a little longer to get your credit card balances down or to pay off some high-interest loans.
By doing this, you will put yourself into a better position financially to get an RV and you will put yourself in a much stronger financial position going forward. Patience isn’t the easiest thing in the world to have, but implementing some patience can be a winning asset.
You can begin your journey with a new RV that fits your needs even if you have bad credit. It may take a little more planning or extra work, but it is definitely possible. Pursue all of your options, know your finances, be honest about your expenses, and you will be well on your way to owning the RV of your dreams.
Ready to take your Credit to the
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