What is a good APR?

[bigmurph]

I borrowed 20k in July through Band of America (They were willing to beat my bank by 1%) for 2.8% for 12 years. We were going to pay cash but decided to borrow at that rate. We will pay it off in the next few years unless something happens. If something does happen we still have our cash to help us out.

[GOTTOYS]

I got 2.49% from my credit union for 5 years. Hard to believe but right now, but I'm getting a lot more than that on my investments plus I can write off the interest on the payments. Wasn't worth paying it off at that rate.

[Witch Doctor]

If your going to do something, I would do it now in the last month loans have jumped thank-you feds. We will never see rates this low again. I just refi my home for 30 years, it was a VA loan at 3.65% I had a lock for 60 days, during that 60 days the VA loans jumped 1% due to the feds. It is unheard of to get a VA loan at 3.65% they have never been that low and never will be again,. Interest rates will be raised 3x's this year 2017 according to Ms. Yellen and the feds.....

[Mr Havercamp]

Originally Posted by 5picker

You folks really taking 20 year loans on your rigs? (240 month)

SMH too.......
There are ways to use such a long term where you can get a benefit out of it, but none involve going all the way to the end of the term. Taking one for that long of a term, or even 120 months IMO, with the intent of using the full term makes no sense whatsoever. Your upside down from day one and deeper and deeper into the hole with every payment. When I went before the paper pusher at the Stealer, he threw the financing doc in front of me and the term typed in was 120 months. I told him to start over. I don't know why I would want to finance a 20K Roo for 10 years but plenty of people do. I would not want to even finance 100K for 10 years.
I financed for 72, refinanced 2 months later for 60 @ at a slightly lower APR, and will have it paid off in 40 months from purchase. Done the right way using other peoples money has it's advantages.

A lot of people can only see the monthly payment amount. If they have to finance using a long term to afford it, they usually can't afford it.

No RV made today is going to be worth much after 10 years let alone 20, that is if it even makes it that far mechanically.

[georgew48]

Originally Posted by SidecarFlip

I paid cash myself. Actually, I pay cash for almost everything, excepy business related purchases that I can deduct the interest on and write off the principal.. I hate finance charges and I have one credit card and it gets paid in full, every month. The farm is paid for as well.

Last time I checked my credit score was 5 points below the maximum.

Don't need no stink'in loans....

Bad enough paying taxes.

Paying cash is great but not always the smartes choice. I bought a new John Deere tractor when they had 0% for 72 months and a new Zero turn mower when they had 0%. No interest charge and not tying up my cash or loosing return on my investments. My last two vehicles were also bought with 0% interest. If you can use other peoples money for free or close to free then that can be a good choice. I would rather have other people's money tied up in my toys than mine if the price is righ.

[SidecarFlip]

........." I bought a new John Deere tractor when they had 0% for 72 months and a new Zero turn mower when they had 0%. ......."

I finance all my farm equipment, including tractors, which usually cost in the excess of 100 grand, implements too and I turn them over every 4 years, but, the finance charges as well as the depreciation on investment is all totally deductible as a business expense. I'm in a continuous finance / interest / depreciation cycle with those items. I never question CNH Capital's finance rate, it's a business expense

I do have a couple investment properties as well that have notes but the renters cover those notes and I'm gaining equity in those properties.... all good for my bottom line and pf course any investments I make in those properties is also deductible as is the interest and taxes paid on them.

Conversely, the interest on an RV, if rolled into a HEQ loan is deductible but as a stand alone loan, it's not.

Besides, as mentioned previously, financing an RV for 10 or 20 years is an exercise in being upside down on an installment loan perpetually because the resale value and depreciation on the unit is so steep. I cannot see any 20 or even 10 year old unit being worth much.

Same applies to a motor vehicle for personal use. Why I pay cash. No payment book and cash is one helluva bargaining tool when purchasing as well.

If I ever financed any RV, I would do it for an extended period with the intent and discipline of paying it off in a much shorter time frame. Under Rule 53, which applies to any and all installment loans (unless specifically stated in writing by the financial institution), that loan will have no prepayment penalty so paying it off early has no consequence. Problem with that is it takes self discipline and self discipline is a rare commodity today.

[The Otters]

2 months ago we got 4.9 through US Bank...not what I wanted but rates are going up..

[wahoonc]

Originally Posted by SidecarFlip

........." I bought a new John Deere tractor when they had 0% for 72 months and a new Zero turn mower when they had 0%. ......."

I finance all my farm equipment, including tractors, which usually cost in the excess of 100 grand, implements too and I turn them over every 4 years, but, the finance charges as well as the depreciation on investment is all totally deductible as a business expense. I'm in a continuous finance / interest / depreciation cycle with those items. I never question CNH Capital's finance rate, it's a business expense

I do have a couple investment properties as well that have notes but the renters cover those notes and I'm gaining equity in those properties.... all good for my bottom line and pf course any investments I make in those properties is also deductible as is the interest and taxes paid on them.

Conversely, the interest on an RV, if rolled into a HEQ loan is deductible but as a stand alone loan, it's not.

Besides, as mentioned previously, financing an RV for 10 or 20 years is an exercise in being upside down on an installment loan perpetually because the resale value and depreciation on the unit is so steep. I cannot see any 20 or even 10 year old unit being worth much.

Same applies to a motor vehicle for personal use. Why I pay cash. No payment book and cash is one helluva bargaining tool when purchasing as well.

If I ever financed any RV, I would do it for an extended period with the intent and discipline of paying it off in a much shorter time frame. Under Rule 53, which applies to any and all installment loans (unless specifically stated in writing by the financial institution), that loan will have no prepayment penalty so paying it off early has no consequence. Problem with that is it takes self discipline and self discipline is a rare commodity today.

I will have to check with my CFO, but I seem to recall that the interest on the RV is deductible as it is considered a second home. YMMV

Aaron

[Tapex]

Here in N.C.,we'll be filling ours as a second home.

[AncientMariner]

As a negotiating too, financing is your friend. The dealer will generally make more profit on the loan "kick back" then the sale itself. Theoretically the dealer can sell you the rig at cost, but finance it and make his profit.

If I like the dealer, I won't pay off or refi the loan in less than six months (usually the kick back is paid after 6 or 12 months of the loan). If the dealer gave me grief, I will pay it off early and they get NO profit.

Just sayin...........

[fx2]

I financed mine for 15 years. That was 2 1/2 years ago. It will be paid off in the next few months. I took the 15 year term because that was the deal with my CU, anything over $25k was a 15 year term and the rate was lower. I never intended on paying on it for 15 years.

Conversely, I COULD have paid cash for it. Financially it didn't make sense at the time because I was making more on investments (and still am).

I have both my truck and DW's cars financed (one at 2.7% and the other at 0.9%). If something happens to one of the cars they are fully insured and have GAP ($199 for the life of the loan through the CU) and I won't be out of pocket ok the depreciated value. I'll make more on investments during that time so my net return (return on investments minus the interest cost on the borrowed money) is still worth carrying the debt.

As many have said....different strokes for different folks.


2014 Surveyor SC321BHTS
2016 Nissan Titan XD SL 4x4 CTD

[CHICKDOE]

couple of comments:


1. can you make more on your investments than the cost of the rv loan?
2. you are continually upside down on a 20 year rv loan. true, but you still have the cash. if you paid for the rv in cash you would be foregoing any income that cash might make.
3. it is stated that the interest on the rv loan is tax deductible. i just about want to hit the rv salesmen in the mouth when they spout that. it is only deductible if you itemize you deductions. if you take the standard deduction the interest on the rv loan is not an additional deduction.


i don't think there is any right or wrong. it more what you are comfortable with.

[georgew48]

Originally Posted by CHICKDOE

couple of comments:


1. can you make more on your investments than the cost of the rv loan?
2. you are continually upside down on a 20 year rv loan. true, but you still have the cash. if you paid for the rv in cash you would be foregoing any income that cash might make.
3. it is stated that the interest on the rv loan is tax deductible. i just about want to hit the rv salesmen in the mouth when they spout that. it is only deductible if you itemize you deductions. if you take the standard deduction the interest on the rv loan is not an additional deduction.


i don't think there is any right or wrong. it more what you are comfortable with.

No 2 is not always true. I had over 50% of the cost of my RV in my paid for trade. Right now the trade in value of my 2 year old motorhome is 60k more then I owe on it on my 20 year loan.

[Kimber45]

i just closed on a 35K 120 month loan with my credit union at 4.29.

[Pinn]

I think I need to talk to my credit union again.. last time I talked to them I was told they didn't finance RV's

[rmac04401]

Originally Posted by Pinn

I think I need to talk to my credit union again.. last time I talked to them I was told they didn't finance RV's

Each CU is different. I have two where I live that I use. One I use for all my loans have best rates, but when I went to check on new RV they were at 9.9%. Went to other and got 5%. It all depends on if they want to deal with RVs or not. RVs are harder to repossess and resell than cars. Some banks and CU don't loan or not competitive on rates to not have to deal with them.

My vehicle loans are 1.9 and 2.4% with the first CU. just need to shop around.

[minattz]

I just got approved for 7.49% Yuck i know...but all my local banks and credit bureaus only are giving out up to 7 years financed. I need 10-12. Any recommendations to look online that will be lower than that. My Fico is about 760.

[CHICKDOE]

I get email all the time from good sam and they advertise rates in the 4-5% range. don't know where you live but also contact Bank of the West as they do rv loans. there may be others. my guess is that the cu's don't really want to do rv loans as they probably do not understand them. (I was on a cu board for many years).

[minattz]

Thank you. Bank of the West starts at 6.00% for 15 years with a loan fee. Ill stick with what i have for now.