On a hot summer day, nothing beats feeling the wind in your hair. Or the cool spray of water on your face. Or the miles of road rolling beneath your wheels.
Owning an RV, boat or motorcycle represents freedom and spontaneity. Need a break from the grind? Grab the keys and go fill up your leisure time with enviable adventures and photo-worthy memories.
The decision to buy one, however, should be anything but spontaneous. While it’s easy to fall in love with a luxurious motorhome, a sleek speedboat or a classic motorcycle, too much strain on your budget could make your leisure vehicle more of a burden than a joy. That’s why it’s important to shop around, not just for the vehicle itself, but also for the best RV, boat or motorcycle loan.
A little research and a few simple money-saving tactics can help you minimize the cost of your extra vehicle, making you a happier camper—or biker, or boater. Here’s how.
Join a credit union
The cat’s out of the bag: Credit unions often provide their members with better interest rates than a bank. That’s one reason a third of the U.S. population, including more than 1.5 million Oregonians, are now credit union members. When you’re financing an RV, boat or motorcycle, a difference of just 1 percent in your interest rate can add up to hundreds of dollars over the life of your loan. Check out our loan calculator to see the difference for yourself.
One of the smartest things you can do as a buyer is get preapproved for an RV, motorcycle or boat loan before ever stepping foot in a dealership. With your preapproval in hand, you’ll know exactly how much you can afford to spend without overextending your budget. You’ll also be in a better position to negotiate the right price and avoid getting talked into a purchase you can’t afford.
Do the math
Buying a preowned vehicle can knock thousands of dollars off the sticker price, but it doesn’t always save you money in the long run. Age and mileage can both affect the interest rate on your motorcycle, boat or RV loan. Since the annual percentage rate tends to be higher on older vehicles and boats, make sure you calculate the total cost (with interest included) before making a decision. Or talk to your loan officer about which option will save you the most money.
Beef up your credit score
When you buy a car, your credit score often determines what kind of loan you’re eligible for, how much you can finance and what your interest rate will be. The same is true with a boat, motorcycle or RV loan. The higher you can boost your credit score before applying, the more you could save on interest.
Weigh the costs
The monthly payment on your RV, boat or motorcycle loan isn’t the only expense you’ll need to factor into your budget. All of these types of vehicles also come with ongoing costs. In addition to licensing fees, fuel and maintenance, you may have to pay special storage or docking charges. You might even need a special driver’s license. Knowing these costs up front will help prevent unpleasant surprises down the road.
Research tax breaks and discounts
Depending on the vehicle you buy, you could qualify for additional savings. For example, certain boats and RVs count as a second home, earning you federal tax breaks based on your loan interest.* Talk with a tax adviser to see if your purchase qualifies. You may also be able to get a discount on insurance by taking a driving course or safety class.
The more you can save on your RV, motorcycle or boat purchase, the more room you’ll have in your budget for fun. Start your recreational journey by exploring your loan options at OCCU.
*Note: The above information is not intended as tax advice. Please consult your tax professional for tax information.