How to finance a motorhome In Australia

With all the amazing adventures made possible, deciding that you’d like to own a motorhome is the easy part! Choosing how to finance a motorhome can be a little more tricky. From buying it outright to taking out a loan, read on to discover all of the options available to you.

How much does a motorhome cost?

The first thing you have to consider is whether you’re buying new or secondhand, and naturally there are pros and cons to both. Buying new will set you back around $150,000 on average, and offers you the flexibility to find a home that really meets your needs on the road. On the other hand, you can pick up a great second hand motorhome for around $110,000 on average.

Learn more about motorhome costs.

How to finance a motorhome: 4 popular options

1. Cash

This may be a luxury for many, but if you’re fortunate enough to have the savings available to purchase your motorhome outright, that’s great! This offers you the freedom to purchase what you want, when you want, without having to wait around for approval.

If you don’t want to pay the whole lump sum at once, it may be worth considering using another payment solution that allows you to pay a deposit and then filter out the remaining balance. This can certainly help with your cash flow.

2. Direct loan

If you don’t have the money available, the next most obvious solution for how to finance a motorhome is opting for a loan. There are so many different types of loans on the market, it’s about choosing what works best for you and your financial position.

• Secured loan: in order to take out a bank loan, you will need a solid credit score to your name. This ensures you’re not just approved for the loan, but also helps keep the interest rate low if you're not considered a huge risk. Banks tend to offer secured loan options, which ties your loan to an asset. The upside: you get a better interest rate. The downside: if you’re unable to repay the loan, the asset may be seized.

• Unsecured loan: you also have the option to take out an unsecured loan (ie, not attached to any assets), but expect it to come with a higher interest rate as well!

3. Broker finance

A broker is the go-between who will deal with banks or other lenders to help arrange the right motorhome loan for you. They act in your best interests and are a popular choice as they can help secure a competitive interest rate for your loan through their connections with major banks and finance companies.

The first thing you need to do is ask your broker how they earn their fee: it may be an upfront cost, or could work on a commission basis. Either way, it’s something you want to know beforehand so that you can be confident you’re receiving genuine, impartial advice that’s in your best interests!

4. Superannuation withdrawal

Have a tidy nest egg? Road tripping across the country in your motorhome is the perfect way to spend your retirement: no commitments, no end date!

Some superannuation policies allow you to withdraw a lump sum that can be used towards the purchase of your motorhome. It enables you to put your retirement money towards those golden years - literally to spend soaking up the sun!

Note that withdrawing your superannuation early can be subject to some hefty taxes, and you also want to make sure you’re keeping enough to fund the rest of your retirement costs. Therefore, it’s always a good idea to consult a financial advisor to ensure this is a viable option for your circumstances.

Considerations for deciding how to finance a motorhome

Figure out your budget

It’s so easy to get carried away when on the hunt for your dream motorhome. Before you even hit the market, it helps to sit down and work out how much you actually have to spend. Putting in place some spending limits is the best way to narrow down your options and work out exactly what you can afford for your buck.

It also helps to look into the running costs of a motorhome each year and factor that into your budgeting. Upkeep costs may affect how much you’re willing to spend upfront.

Check your credit score

If you’re not purchasing your motorhome outright, then your credit score is going to factor into your loan choice. The score is based on a number of factors including, the amount you’ve borrowed in the past, the number of credit applications you’ve made and whether you’ve paid back previous loans on time. A high score makes you much less of a risk to any potential lenders.

You can usually access both your credit score and credit report for free with any credit reporting body.

Look at the buy back price

This is an important thing to consider when choosing how to finance a motorhome - just in case you’re unable to pay back your loan due to personal circumstances. Depending on where you’re purchasing your motorhome from, some dealers will add a buy-back clause into the contract, where they guarantee a percentage based on the agreed value of the motorhome.

Consider the interest rate

The cost of the motorhome is one thing…adding in the interest you have to pay back over the years is another! Work out if you’re able to afford the weekly, fortnightly, or monthly repayments and whether a secure or unsecured loan works for you.

Sort out insurance

The final piece of the puzzle is your motorhome insurance. It’s something most lenders will want to see before they release funds to you. Motorhome insurance is in your best interests while on the road and will protect you if it comes to accidents, break-ins and more.

The good news? If you decide to make a return on your investment by renting out your motorhome through Camplify when it’s not in use, your hire insurance costs will be covered during bookings! More on this below.

Make a return on your motorhome investment

Now that you have a better understanding of how to finance a motorhome, you’re ready to take the next steps. Assuming, of course, you’re not buying a motorhome outright to begin with - in that case, it’s simply time to get shopping!

And once you’ve purchased your motorhome, make a return on your investment when it’s not in use instead of putting it in acaravan storage facility! Each year, heaps of Aussies earn up to $10,000 by renting out their motorhome through Camplify. It provides a quick and easy way to generate long-term passive income.

And the best part is, Camplify takes care of many of the expenses involved in hiring out your vehicle, including:

• Comprehensive hire insurance.

• 24/7 NRMA nationwide breakdown cover for hirers.

• Dedicated customer support.

If you’re interested in joining Camplify as an owner, try our earnings calculator and see how much income you could generate each year by renting out your unused motorhome!