Secured loan for Motorhome purchase

humey86

We are in the market for a motorhome and done plenty of research regarding this. HP over 10years would be ok but we are struggling to find a suitable van through a dealer at an affordable price. Privatly we can find a van that is perfect for us at around £29k with low mileage and around 4yrs old. The only way to get this amount is through a secured loan. Quotes are coming back at around the same price I am paying for my PCP car (which we will be getting rid of). In 4years time a loan will be paid off that we took out for home improvements (£250pm) and our mortgage is due for renewal in 5years. With this all said we have a fair disposable income of around £1800.

Will the loan be secured against the van? Is there usually an option to pay back early if we get funds?

foxy-stoat

Secured loans are normally on property, so your home will be at risk if you default.  You can settle early yes, there will be early repayment charges to factor in.

DrEskimo

If you have £1,800 in disposable income, why are you looking to pay it off over 10years?

Just wait 16months and you will have enough saved to not even need a loan.

Nebulous2

Motor homes (and caravans) are in very short supply. Everyone has dived into the holiday at home thing. A lot of adverts for motor homes are not what they appear to be either - an awful lot of them seem to be from brokers. If you wait another 3 months or so you’ll get a seasonal dip in prices, cheapest around October and most expensive in the Spring. Make sure you get a layout that works for you. Talking to people on site they often regret the layout they have and wish they’d gone for something different. 

I’d try to save a deposit and get an unsecured loan. If you can save £1800 a month in 5-6 months you could have £10k to put down and will have a lot more options. 

Clive_Woody

Many banks offer unsecured loans up to £25,000 so you could save all your spare cash (£1800/month) for a few months and then take out a loan. As mentioned already, you are better off making a purchase like this out of season so this could work out perfectly. Avoid a secured loan that puts your house at risk.

foxy-stoat

DrEskimo said:

If you have £1,800 in disposable income, why are you looking to pay it off over 10years?

Just wait 16months and you will have enough saved to not even need a loan.

Its going to be his daily driver.....they have to stump up £6,000 when they had back their car on PCP so they can buy a £30,000 motorhome with more borrowed money - hope they dont put too many miles on it or change their minds before they have paid for this one.

Grumpy_chap

humey86 said:

HP over 10years would be ok

a van that is perfect for us at around £29k

we have a fair disposable income of around £1800.

If you need a 10 year finance plan for the vehicle, then you cannot afford that vehicle.
If you have £1,800 spare each month, why will you take a 10 year plan for £29k?

Nebulous2

foxy-stoat said:

DrEskimo said:

If you have £1,800 in disposable income, why are you looking to pay it off over 10years?

Just wait 16months and you will have enough saved to not even need a loan.

Its going to be his daily driver.....they have to stump up £6,000 when they had back their car on PCP so they can buy a £30,000 motorhome with more borrowed money - hope they dont put too many miles on it or change their minds before they have paid for this one.

That might not work - depending what he does for a job. Motor Homes are relatively cheap to insure, but are very restricted in what you can use them for. Work use may not be allowed and even travel to work is often excluded. 

DrEskimo

foxy-stoat said:

DrEskimo said:

If you have £1,800 in disposable income, why are you looking to pay it off over 10years?

Just wait 16months and you will have enough saved to not even need a loan.

Its going to be his daily driver.....they have to stump up £6,000 when they had back their car on PCP so they can buy a £30,000 motorhome with more borrowed money - hope they dont put too many miles on it or change their minds before they have paid for this one.

Oh didn't realise this is the same user as the other thread.

I agree, but the £6k was to VT their current car. They have been offered £11k for it with £13k outstanding, so trading it into WBAC would only require writing a cheque to them for £2,000.

But your point still stands!

Brock_and_Roll

<rant>

Dont do it for several reasons....

1) Depreciation monsters - my late father had a £40k motorhome bought nearly new from a dealer. As you may have noticed private sales are short supply and the dealers drive a very had deal when selling. Despite being hardly used I eventually sold his van for £13k two years later.....so that's £13.5k of depreciation per year. Put another way for the same price of "freedom of the (clogged) road" and crapping in a plastic toilet, you could have had 77 nights in 4 star hotels of your choice !!

2) Environmental  - these vans are basically large quantities of plastic and mdf built onto the chassis of a standard long wheelbase vans. With their diesel engines and the aerodynamics of a brick these are pretty bad environmentally all round

3) Driving - Unless you are planning to tour Europe or the USA, what's the point? British roads really are not suited to these vehicles. Here in the new forest we groan every year when the influx of middle aged couples in their large plastic vans trying to negotiate narrow lanes!

/rant over!

lordmountararat

Brock_and_Roll said:

<rant>

Dont do it for several reasons....

1) Depreciation monsters - my late father had a £40k motorhome bought nearly new from a dealer. As you may have noticed private sales are short supply and the dealers drive a very had deal when selling. Despite being hardly used I eventually sold his van for £13k two years later.....so that's £13.5k of depreciation per year. Put another way for the same price of "freedom of the (clogged) road" and crapping in a plastic toilet, you could have had 77 nights in 4 star hotels of your choice !!

2) Environmental  - these vans are basically large quantities of plastic and mdf built onto the chassis of a standard long wheelbase vans. With their diesel engines and the aerodynamics of a brick these are pretty bad environmentally all round

3) Driving - Unless you are planning to tour Europe or the USA, what's the point? British roads really are not suited to these vehicles. Here in the new forest we groan every year when the influx of middle aged couples in their large plastic vans trying to negotiate narrow lanes!

/rant over!

This is not always true. My van is 17.5 feet long with a shower and a toilet. It is a mid wheelbase van conversion, so very little plastic. It has a petrol engine and LPG conversion, so I can run it on either, and therefore not too environmentally unfriendly. You were unlucky with that amount of depreciation; normally motorhomes don't depreciate as much as most cars.