Finance

Buying a touring caravan, motorhome or caravan holiday home is a significant purchase, and few people pay for one outright. Finance allows you to spread the cost over a period that suits your budget, typically through a fixed monthly payment plus interest. Here is how the process works and what you should consider before signing an agreement.

How the application process works

Applying for caravan finance is straightforward and can be done in minutes. You provide some personal details along with information about the vehicle you want to buy and the amount you wish to borrow. There are no lengthy paper forms to post and no need to visit a bank branch. Decisions are usually made within the hour during normal office hours, after which an adviser will discuss the terms with you and answer any questions. From that point, you can expect personal service from a named adviser who will help you find a suitable deal.

The main types of finance

Finance for touring caravans, motorhomes and caravan holiday homes can be arranged through approved lenders and credit intermediaries. Terms are available for up to 12 years, with a fixed monthly amount plus interest. The most common arrangement is Hire Purchase.

Hire Purchase

Hire Purchase lets you buy a caravan while spreading the cost. You agree an initial deposit, an agreement term and a monthly payment amount. The lender then submits the finance application, and subject to approval you can take ownership of the vehicle. Once all payments, including interest, have been made, the caravan or motorhome is yours outright.

How it works in practice

• Choose your new caravan. Used touring caravans can be up to 20 years old at the end of the agreement; motorhomes and holiday homes can be up to 17 years old at the end of the agreement.
• The lender buys the caravan on your behalf, less any deposit you have paid to the dealer.
• The remaining balance plus interest is repaid over an agreed period of one to ten years.
• Payments are fixed, meaning the APR is set before the agreement begins and will not change.
• You can borrow any amount from £1,500 to £250,000.

What you pay

• A flexible deposit, from 0% (subject to status).
• Fixed interest rates, so you always know the amount of each payment until the caravan or motorhome is yours.
• Repayments over your chosen period.
• Once all payments including interest are made, you own the vehicle.

Points to weigh up

Hire Purchase has clear advantages. You can choose any new or used caravan up to ten years old, and decide how long you want to make regular payments, from one to twelve years. Your repayments stay the same throughout the agreement, which makes budgeting easier. It is ideal if you want to own your caravan outright, and you have protection under the Consumer Credit Act, including Termination and Satisfactory Quality Rights.

There are also obligations to understand. You do not own the caravan until the final payment has been made, and the vehicle is at risk of repossession if you do not maintain contractual repayments. You must also insure the caravan or motorhome.

Getting advice

There are several ways to finance a caravan, motorhome or caravan holiday home, and an experienced adviser can talk you through the options, explaining the terms and conditions and the pros and cons of each. The right deal will depend on your personal circumstances and preferences — whether you want to put down a deposit and manage the expense over a shorter or longer period, or pay smaller monthly sums with a larger balloon payment at the end. The aim is to find the most competitive package available for your situation.

Benefits of caravan finance

• Flexible terms and repayments that suit your requirements and your pocket.
• No need to use up your savings to buy a touring caravan or caravan holiday home.
• Enjoying your dream motorhome, touring caravan or caravan holiday home now and for years to come.

Finance is subject to status and is only available to UK residents aged 18 and over.