How Can I Pay Off My RV Loan Faster? (and Earn Some Extra Income)

Owning an RV can be expensive. You likely took out a loan to purchase one with minimum payments it’ll take anywhere from 48 to 120 months to fully pay it off. But what can we do to pay off that RV loan faster so we can enjoy it loan free? There are a lot of ways we can pay off our loan faster and here are some of the best ways we can do that:

  • Make more payments or make them more frequently
  • Look for a loan with a lower interest rate, maintain loan payments, or increase them.
  • Borrow money from a friend/family member
  • Take a shorter-term loan
  • Work a second job on the side (Ride Sharing, Door Dashers, Postmates, Uber Eats, Skip The Dishes. etc.)
  • Rent your RV out through an RV sharing site
  • Rent your usual vehicle out
  • Spend less money on other luxuries (Netflix Subscription, Games, Going out to Restaurants. etc.)
  • Purchase your RV during a sale or the off season

Making more payments could be more frequent payments or larger less frequent payments depending on whatever works best for you, but if you’re strapped for cash taking a loan using another piece of property like your car as collateral can help with the initial crunch of debt buying an RV can occur. If you don’t need a lot of money you could even, consider borrowing money from a friend or family member if you’re worried about making deadlines for payments. Beyond that if a loan of any kind is out of the question it’s common for people to work a side job, like delivering food or ride sharing that can work as a quick way to get more cash to go hit the lake sooner! But why stop at working more to make more money when that new RV of yours could be making money for you by renting it out? At the end of the day how we save money depends on our current situation and not all of these solutions will work, so we might have to consider even just making cuts to some recurring expenses, like subscriptions we pay on a weekly or monthly basis or how often we order out food. We can go further into detail on all of these points and together find the perfect solution to hitting the trail on our RV sooner. 

Availability of Loans for RVs

Before we can even talk about taking out a loan for an RV we have to make sure we can even get one, unlike a house or a normal vehicle an RV is considered a luxury and if your credit rating is low you may not be able to finance it. Most loans with a decent interest rate require you to have a FICO score of 660-700, but it’s not impossible to get one with a rating as low as 500. Keep in mind that due to the size of the loan if you’re just making basic payments you might be stuck with this loan for a long time and they can be around 20 years depending on the bank. So just finding a decent loan that won’t kill your bank account is the first challenge we’ll have to get around, even with something as low as 5% interest we’ll end up paying for our RV multiple times over with the interest alone. So, before you set out on buying an RV make sure the loan you use to finance it will not only cover the cost but allow you to pay it off in a reasonable time. A decent loan for an RV costing around $40k will have an interest rate of about 5.4% and last you around 48 – 84 months depending on how frequently you pay the loan. But let us get into more detail on what exactly you can expect getting a loan from your local bank and why you might want to go that option over financing your RV through the dealership itself. 

What kinds of loans can I take out for my RV?

Taking out a loan can help get you off the hook for paying off your RV, but it isn’t a perfect solution. Most RV dealerships will allow you to finance an RV with interest and if you fall behind on interest, they can take back the RV and then some. I’d recommend trying to get a loan from your bank over financing through a dealership if only to get a better interest rate. Many RV dealerships offer a long-term loan that can last up to 240 months (20 years), even at a relatively low interest rate of 10% the amount you pay in interest will be more than double the cost of the RV itself if you just made basic payments. You also must be careful of dealerships that charge extra for paying off your financing early (though these are admittedly rare). Bank loans tend to have shorter pay periods of around 48 months though due to the size of the loan they could be longer. I’d recommend shopping around banks and dealerships to see the best financing option you can find. 4% interest is about as low as you can get and 15% is the upper end of what you can expect, I’d recommend finding something with no higher than an 8% interest rate to avoid paying more than double for your RV. With all that in mind, we can also look to extend other kinds of pre-existing loans or mortgages, like on your house or putting a lien on your own vehicle to help pay for your RV. Other ways we can help with loans is by making a larger down payment or making more or larger payments to avoid paying as much interest as possible. Another way we can keep our loan low is by shopping around dealerships to find the best price possible for the kind of RV you want. With how expensive they can be you don’t want to spend a dollar more than you have to, so make sure to not only compare prices but also try and haggle the price down, like with buying a car only a sucker pays the sticker price for it. But how can we make sure we have more money to make more RV payments?

spend less in my day to day life?

With any debt in life the best way to pay it off is to make more payments. This can seem daunting with how many bills we pay on a weekly or monthly basis. If we’re looking to make some cuts the first place to go are all those subscription fees, we’re paying there are loads of services we pay for such as: 

  • Netflix
  • Spotify
  • Video Game Subscriptions/Micro transactions
  • Ordering out Food
  • Expensive coffees

If we cut out these expenditures we can save a lot of money, Netflix alone is a $13-$16 monthly fee we pay, over a year we can save $72, it doesn’t seem like much but every dollar we save can be put to paying off that RV faster. If we include Spotify that’s another $10 a month we save. Even just packing a lunch instead of getting fast food saves a fair chunk of money, with the average meal costing around $12-$15 you can save around $10 by hand packing a lunch instead of going to McDonalds for a meal. So, if we save $10 a day everyday for a month, we save $300 a month just on going with packed lunches over fast food lunches. But if we can’t cut costs everyday, we can make more money other ways, specifically by selling off old things you don’t use anymore. This could be simple things like old baseball cards or other collectibles, childhood toys, and even old clothing that doesn’t fit you anymore. You can sell a lot of this stuff off at a pawn shop or on websites like eBay, though if you have big ticket items like a car or rare collectibles you might do better by going to a local auction and selling them off there. With these strategies in mind we can make a big dent in paying off our RV. We can go a step farther by finding the perfect time to buy an RV to save even more money!

Side Jobs that could add extra income?

So, what kind of work could you do to help pay off an RV? Well it really depends on what your comfortable doing your free time. Here are a few options:

  1. Food delivery
  2. Ride sharing
  3. Drive for Amazon Flex delivery service partner or other similar programs
  4. Start a side gig - use a skill you have on upwork, freelance, facebook or guru
  5. Create and online course, create a niche site, or youtube channel 

Some of these options will give you immediate cash at hand and others might take a little bit to build up, but also has the potential to far exceed your employment income. these contract work apps allows people to easily make money quickly without much effort, they pretty much all use an app of some sort to sign up and get going. They all have pros and cons to them, but depending on your situation, they might be a fit for you. 

Food delivery

Is one option that can earn you an extra $1000 a month working 20 hrs a week. Apps like just eat, Ubereats, skip the dishes, seamless, grubhub, doordash and eat24.   

Pros

  • work as many hours as you like

  • get tips as additional income

  • Get paid through quickly

  • efficiencies can increase your income

  • get paid more if you can do more deliveries

Cons

  • you car can smell like food all the time

  • wear and tear on your car that you pay for

  • you pay for the gas

  • lower income

  • income stops if you don’t work

Ride sharing - Driving other and get Paid

this is another option that involves the use of your car for you to be doing deliveries, except it is driving people around, pretty much like a taxi, but without the license that a certified taxi requires. It is all managed through the app, payment, tracking, tips etc. Uber and Lyft are the two most common apps out there. Again potential income is about $1000 to $2000 a month working part time.

Pros

  • more people you drive they more you make 

  • get paid immediately

  • get tips for good service

  • can meet some nice people

  • more trips more money

Cons

  • dealing with drunks and potentially dangerous people

  • income is a bit low

  • no work no income

  • you must provide your own gas - prices high low profit

  • must keep the car neat and clean, along with your appearance

  • Increases odds of an accident

Delivery Driver

Amazon Flex, Lasership, roadie, are companies that are replicating delivery services such as usp and fedex and you can be the driver for one of these companies and get paid to do so. Then there are companies like instacart that does personalized shopping where you do groceries for people and deliver it to there door. Income potential working part time can about about $1000 to $2000 a month depending on how many hours you want to be dedicated to this.

Pros

  • Get paid immediately

  • more delivers more income

  • great if you don’t like to deal with people too much

  • can take a huge batch and deliver at once

Cons

  • no tips for deliveries

  • use of your own car and gas

  • income is low

Start a side gig with skills you have

Depending on what you do for a living it might be possible for you to do some moonlighting on the side for some extra income. The easiest way is to post an add on Facebook or craigslist or join some business groups that would need your services. If your skills are something that can be done remotely then sites like Upwork, guru and freelancer could be options for you to do what you do in your day job for someone else at night or on your time off. You need to be careful that what you are doing does not jeopardize your day job as it could turn into a conflict of interest. If you are doing someone on the side such as writing, we are always looking for great writers, you could write for this site and earn some extra income as well. So what are the pros and cons of a side gig?

Pros

  • you have flexibility in your hours 

  • it could turn into a very profitable full time income with people working for you

  • Greater earning potential

  • It could be online and gives you more flexibility

Cons

  • When you don’t work you don’t get paid

  • you might not get paid and can’t collect

  • you might have to acquire new skills such as sales and marketing (outside of your comfort zone) steep learning curve

Create an Online Course, Niche Site or YouTube channel

Today we live in a knowledge society where people turn to the internet to find anything they want. We all have some kind of knowledge about things that we can share. Everyday I find myself looking up information either on google, YouTube or Facebook. Someone generally has the answer for me, but when I am looking for specific answers to things, and I just can’t find it online, this means there is an opportunity to create that information to share and can potentially make money by sharing that knowledge. I really love this type of business as it has so many opportunities. It is not for everyone. Let’s go over the pros and cons of this model.

Pros

  • It becomes passive income 

  • good income potential

  • leverages time and effort

  • Can be leveraged into multiple businesses.

  • Work when you want to

Cons

  • can have a longer ramp up time for income - weeks or months

  • may need to learn specialized skills to market and sell

  • Steep Learning curve if you lack experience

  • can be competitive depending on the niche

Which side Gig is best?

Each one of these side gigs have their pros and cons for each of them. Food deliveries, ride sharing require your time, labor and vehicle and does not pay much, plus you income is capped by time and effort. Starting your own gig has huge income potential but there are risks in starting and running, plus the use of your time and efforts to create income. Now lets look at renting out stuff as potential income to help pay off your RV loan quickly. 

Rent out my RV in the share economy?

Renting out your RV can turn a large money sink into something profitable. Depending on your earning goals you can rent out your RV to your friends. However, I’d recommend keeping in mind how much RV dealerships around you are renting their own vehicles and try and undercut them to be more attractive. Most dealerships rent out motorhomes for around $1000 a week and if all you have is a trailer then it’s more like $500 a week, assuming the vehicles have bedding, and kitchenware supplied. I’d recommend renting out a motorhome for around $900 a week and trailers for $400 a week to make a profit and to give your clients a good deal. If you don’t have anyone you know locally to rent an RV out to that isn’t a problem, check out this article on RV share websites and find the best type of RV rental site for you. The article gets into detail on what you can expect with each type of RV share site. One of the best RV share sites for the owners is Outdoorsy, RVshare and in Canada RVezy. They are very similar and offer insurance protection and cleaning fees that help protect the owner. If sharing your RV is something, you’re not comfortable with perhaps we can find another way to pay off our RV. 

Share all your stuff

Renting out your RV is not the only thing you can rent out today in the share economy. Here are a few things you can rent out to get extra income to put towards paying down your RV loan. Not to mention that if you rent them out, then they become a business in which you would need to report the income for taxes, but that also can work for you as a write off, rather than as an expense. Check with your accountant for the details and what you need to do to write these items off. 

Rent out a room or part of  your house

If you have extra room, basement space or garage why not rent it out. The potential income can be anywhere from a $200 to $1000 a month depending where you live and the demand. Check in your local online classified or Facebook to determine what the going rate is for your area. 

Rent out extra property

If you live in a nice area, where people might want to visit, there is a potential to get substantial income by renting out space to visitors on Airbnb or homeaway. This can be substantial income based on where you live and what kind of property you have. The caveat is that this can turn into quite a bit of work if you do all the cleaning yourself and leg work. It is best to think of this as a business and hire out cleaning and utilize delivery service for supplies. This allows you to maximize your time. 

Rent out your vehicles

If you don’t utilize your car or truck to get you to work  or perhaps you can take public transit and rent out your vehicles for that extra income. Turo is a site aimed to car sharing. 

Rent out other stuff sitting around

Rent out other stuff you might have laying around that you don’t use often. Let say power tools or other toys such as jet skis, kayaks, boats, ATVs and backpacks. Literally anything can be shared today. 

Conclusion

In conclusion when paying off an RV everything from when we buy it to how we pay for it can make the process longer or shorter so make sure that we’re keeping these points in mind:

  • The term of our loan
  • The interest of our loan
  • How we pay it off
  • Alternative ways to raise funds
  • How we can pay less on the RV in general

From there, remember to do basic research on dealerships before you make a final purchase, websites like Yelp can help you make an informed decision that what you’re buying is a quality product. Remember to shop around for RVs like the old saying goes only a sucker pays the sticker price for a vehicle, and that includes RVs and motorhomes. Don’t be afraid to haggle or to check out multiple dealerships that are selling the same product, after all just finding someone with a better price can be a great tool for haggling for a better price. Once you’ve purchased your dream RV remember to make as many payments as possible to pay it off as fast as possible so you can get to enjoy the lake or wherever else you happen to park. Thank you for reading this post and I hope the information was useful! 


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