When you are looking at taking out a loan or getting caravan finance, there are inevitably things that you need to think about. Getting any type of finance is a big commitment, and you need to think about affordability and cost to ensure you do not overstretch yourself and end up regretting the purchase of your new caravan. So, to get the right finance, here are a few tips to help you.
Think About How Much to Borrow
To begin with, you will need to consider how much you want to borrow. For example, do you already have a healthy deposit to put down, or should you be looking at saving more money? Are you just looking to borrow below 50% of the purchase price of your caravan, or are you looking for more? It is important to work out how much you want to borrow (and need to borrow). You want to be sure that you give yourself enough breathing space too. If you cut it too fine with the borrowing, you may feel stressed.
Use a Loan Repayment Calculator
When looking at getting caravan finance, it is important to do your calculations and see just what repayments you will be looking at. Getting to grips with a repayment calculator will help you establish how much finance will cost you per month (or over the year). If you are not using a repayment calculator, then how are you going to check affordability? How are you going to be sure that the caravan of your dreams is realistically in the budget, both now and in 12 months? A repayment calculator can also help you see if your deposit is big enough for the finance or loan you wish to raise.
How Long Do You Need Finance For?
After looking at the figures in the repayment calculator, you need to think carefully about the duration of finance. How long are you going to need finance for? The length of finance or a loan can dramatically affect your monthly repayments, so think about this as soon as you can. Will you need the finance in place for the next five years, or are you looking for a longer-term arrangement?
Using Specialist Providers and Looking at Brokers
Not everywhere offers caravan finance, and this is something you should establish early on in your search. Reaching out to specialist providers and even contacting brokers can be hugely beneficial to your efforts. Specialist providers and brokers can search the marketplace for you and help put you in touch with affordable and reputable providers.
Carefully Check the Interest Rate and Repayment Rate
Once deals have been found, it is imperative to check out the interest and repayment rates. This can vary if you are on a variable rate, so try and establish what you will be paying per year if possible. Some interest rates can look low to lure you in, but when you read the small print, you can find that they may just be for an introductory period. So, always take your time to find out what the interest rates and repayment rates are.