How caravan finance actually works

Secured or unsecured?

A secured loan uses the van as security. If the loan isn't paid, the lender can take the van back. That's less risk for them, so you usually get a lower rate and a longer term.

An unsecured personal loan isn't tied to the van. It can make sense for an older or cheaper van a lender won't take as security, or if you'd rather nobody had an interest registered against it. The trade off is a higher rate and a shorter term.

Most people buying a caravan, camper trailer or motorhome end up secured. If both are on the table, we'll put them side by side with the full cost of each, and tell you which one we'd pick.

What lenders want to know about the van

Lenders ask one question about the van. If this goes wrong, what are we left holding?

So they look at its age, its value and how easily it would sell. A new van from a dealer is the easiest to finance. Used is fine too, but many lenders cap how old the van can be by the end of the loan. An older van can mean a shorter term, a valuation or an inspection.

Motorhomes and campervans have an engine and rego, so lenders treat them a bit more like a vehicle. Camper trailers usually sit with caravans, though some lenders treat a cheaper camper more like a personal loan.

What lenders want to know about you

Mostly, whether you can comfortably afford it, today and for the whole term. They'll look at your income, your living costs, your other debts and your credit history.

If you're employed, that's usually payslips and bank statements. If you're self employed, it's tax returns, or with a low doc lender, BAS statements and a letter from your accountant.

A bit of credit history you're not proud of doesn't automatically rule you out. Some lenders care more about where you are now than where you were. Tell us straight and we'll tell you straight what's realistic, before any lender sees a thing.

Buying from a private seller

Plenty of great vans are sold privately, and lenders will finance them. There are a few extra steps, and they're there to protect you.

Before settlement we run a PPSR check. It tells you if there's still money owing on the van, or if it's been reported stolen or written off. If there's finance owing, it gets paid out at settlement so the van is yours outright. On an older van the lender might also want a valuation or an inspection.

On the day, the lender pays the seller directly. No envelope of cash in a stranger's driveway.

Retired? You can still finance a van

Lenders look at what you actually live on. Super income streams, pensions, investment income, part time work.

Some lenders are more comfortable with retirees than others, and some cap the term based on your age. Your Finance Specialist knows which ones to go to first, so you're not knocked back by a lender that was never a fit.

Think about the term carefully. A longer term brings the repayment down but you pay more interest overall. And if there's a balloon at the end, you'll want a plan for it.

Should you have a balloon?

A balloon is an amount you leave owing at the end of the loan. Your repayments are lower because you're not paying off the whole van during the term.

The catch is that lump sum. When the loan ends you pay it out, refinance it or sell the van. If the van's worth less than the balloon by then, you cover the gap.

A balloon can make sense when monthly cash flow matters more than the total cost. If finding the lump sum would be a struggle, it probably isn't for you. We'll show you the total with and without one, so you can see what the lower repayment really costs.

What it really costs

The rate is the number lenders like to put in big print. It isn't the whole price.

The real cost is the rate plus the establishment fee, any monthly account fee, any valuation fee, our fee and any balloon, added up across the whole term. A cheap rate with heavy fees can cost you more than a slightly higher rate without them. So compare the total, not the headline.

And yes, we charge a fee. Every loan has fees and ours is one of them. It varies by loan, lender and the work involved, anywhere from zero up to two thousand five hundred dollars. It's normally built into the loan rather than paid out of pocket, and every quote and repayment we give you already includes it, along with every other fee and charge. You'll see the exact figure in writing before you commit to anything.

A caravan takes longer than a car

A car loan can go from first call to keys in a few days. A caravan usually can't. Lots of new vans are built to order, so most of our caravan customers are waiting on the build before the finance settles. It can run for months.

A lot changes in that time. Lenders change their rates, the Reserve Bank moves the cash rate, and plans change. Walk one caravan show and the wishlist grows. Walk three and you're looking at a different van.

Nearly 20 of our 50 plus lenders specialise in caravan and leisure finance. On a long build, part of your Finance Specialist's job is keeping an eye on them for you, so the loan you settle on still suits you when the van is ready.

How Tommy's camper became a Kokoda

Tommy Bansfield came to Lana wanting finance for a camper. He and his wife were heading into retirement with a lap of Australia planned. Then they went to a few caravan shows, and the camper became a full off-road van.

It took three to four months from first call to settlement. The budget changed more than once. The Reserve Bank lifted the cash rate and the lenders we use for caravans changed their rates along the way. Lana kept up with every change and answered every question as it came. There were plenty.

Tommy ended up with a Kokoda Defender XCore, built to order, for $131,000, plus the extras that made it his van. That's a pretty normal caravan deal. It's also why having one person from start to finish matters more here than almost anywhere.

Sort the finance before you fall for a van

If you know your budget before you shop, you can move fast on the right van. You're also not making finance decisions at a show stand with a salesperson waiting.

If your van's being built, talk to us early anyway. We'll work out what fits, then time the approval so it's still current when the van's ready.

It's worth checking the car too. If what's in the driveway can't tow what you're buying, we do car loans as well.

Seeing your options takes 90 seconds and leaves no mark on your credit file. Your Finance Specialist checks 50 plus lenders and shows you what fits and what it'll really cost. Nothing goes to a lender until you say go.

Less bank talk. More straight talk.