What Are RV Interest Rates & How to Get a Lower One?

Purchasing a recreational vehicle involves understanding RV loan interest rates. These rates influence the overall cost of owning an RV, including monthly payments and the total amount repaid. For many, financing is a practical pathway to RV ownership, making this understanding essential.

Understanding RV Loans

An RV loan is a financial product for purchasing recreational vehicles, including motorhomes, travel trailers, and fifth-wheels. These loans are typically secured, meaning the purchased RV serves as collateral. This arrangement mitigates lender risk, as they can repossess the vehicle if payments are not met.

The structure of RV loans often differs from conventional auto loans or home mortgages. While car loans typically have shorter terms, RV loan terms can range from 5 to 20 years, with 10 to 15 years being common. For unsecured personal loans used to finance an RV, terms might be shorter, often capped at five to seven years.

Key Factors Influencing RV Interest Rates

Several factors affect RV loan interest rates. Credit score is the most influential factor. Higher credit scores (typically above 670 or 740) indicate lower risk, leading to more favorable rates. Lower credit scores (550 to 674) are perceived as higher risk, resulting in significantly higher rates.

The length of the loan term also impacts the interest rate. While longer terms can result in lower monthly payments, they typically lead to a higher total interest cost over the life of the loan. Shorter repayment periods, conversely, generally come with higher monthly payments but can result in substantial savings on total interest paid. A larger down payment (often 10% to 20%) reduces the amount borrowed and lender risk, which can lead to a lower interest rate.

Whether the RV is new or used can influence the financing terms, with new RVs sometimes qualifying for slightly lower interest rates due to less immediate depreciation risk. The total loan amount can also affect the rate, as higher amounts may be associated with increased perceived risk by lenders. Different types of lenders, including banks, credit unions, and specialized RV lenders, often offer varying rates and terms, making comparison shopping beneficial. Broader economic conditions and prevailing interest rates set by central banks can also affect RV loan rates, with economic uncertainty potentially leading to tighter lending criteria.

Current RV Interest Rate Landscape

As of August 2025, RV loan interest rates vary based on factors, particularly creditworthiness. For individuals with excellent credit, rates can be as low as 5.99%. The average interest rate for personal loans (sometimes used for unsecured RV financing) is around 12.57%, with rates from 7% to 36% depending on credit quality.

Rates vary across credit tiers, reflecting the lender’s assessment of risk. Borrowers with excellent credit scores (typically 740 or higher) can access the most competitive rates, often in the single digits. Those with good credit (scores generally between 670 and 739) will find rates that are still favorable but higher than the lowest available. Conversely, individuals with fair or poor credit scores (ranging from 550 to 669) should anticipate significantly higher interest rates, which can reach into the double digits.

RV loan terms are often longer than standard auto loans, allowing for more manageable monthly payments. However, this can increase the total interest paid over the loan’s life. While RV loans are distinct, their rates often follow similar trends observed in the broader auto loan market.

Securing Favorable RV Interest Rates

Obtaining a more favorable RV interest rate begins with strengthening your financial profile. Improving your credit score is a primary step, which involves consistently paying all bills on time and maintaining low balances on credit cards, ideally keeping utilization below 30%. Regularly checking your credit report for any inaccuracies and addressing them promptly can also positively impact your score.

Increasing your down payment is another effective strategy. Providing a larger initial payment reduces the overall loan amount and signals lower risk to lenders, potentially qualifying you for a lower interest rate and leading to reduced monthly payments. While a 20% down payment is often recommended, putting down more can further enhance your loan terms. Choosing a shorter loan term can also lead to a lower interest rate, though it will result in higher monthly payments.

Shopping around for lenders is important, as rates and terms can vary significantly between financial institutions. Compare offers from various banks, credit unions, and specialized RV lenders to find the most competitive rates. Utilizing pre-qualification options allows you to compare potential rates without impacting your credit score. Finally, preparing all necessary documentation in advance can streamline the application process and demonstrate your readiness. This typically includes proof of income, a valid driver’s license, and financial statements.