Most caravan finance sits between 7% and 10% over 5 to 7 years, with a 10% to 20% deposit. A $120,000 van at 8.5% over 7 years runs about $1,920 a month. Get pre-approval before you walk into the showroom.
How caravan finance works
A caravan loan is a secured loan. The van itself is the security. That means lower interest rates than a personal loan, and stricter rules about what condition the van has to be in.
Most lenders run terms between 5 and 7 years. Some stretch to 10. The longer the term, the lower the monthly payment, the more interest you pay overall.
What affects your rate
Three things move the needle. Your credit score, the size of your deposit, and whether the lender treats the van as a primary or secondary asset.
Caravans financed as a 'leisure asset' attract slightly higher rates than vehicles. Some lenders charge more for off-road models because the resale market is narrower. A good broker handles this for you.
Deposit expectations
Most lenders want 10% deposit minimum. Some will go to 5% with a strong income. A 20% deposit usually unlocks the best rates and removes the need for lenders mortgage equivalents.
On a $120,000 Dirt Road Xtreme, that is $12,000 to $24,000 down. On a $172,500 Scorpion Sting Air, $17,250 to $34,500.
What the maths actually looks like
A $120,000 van financed at 8.5% over 7 years with $15,000 deposit runs about $1,665 per month.
Same van at 8.5% over 5 years runs about $2,155 per month. You pay $19,400 less in total interest over the shorter term.
Stretch to 10 years and the monthly drops to $1,300, but you pay nearly $36,000 more in interest than the 5-year option.
Get pre-approval before you walk in
Pre-approval gives you three things. A realistic budget. A stronger negotiating position at the dealer. And the ability to walk away if the maths does not work.
Most pre-approvals take 24 to 48 hours and stay valid for 60 to 90 days. There is no obligation to use the loan if you change your mind.
What lenders will ask for
Two years of tax returns or three payslips. Bank statements for the last three months. Existing loan and credit card statements. A licence and proof of address.
Self-employed buyers usually need two years of business activity statements and an accountant letter. The process is no harder, just one extra step.
Red flags to watch
Balloon payments make the monthly look low and leave a lump sum at the end of the term. Sometimes useful, often a trap.
Dealer finance with rates above 10% in the current market is high. Always get a second quote from an independent broker before signing.
'No deposit' offers usually mean a higher rate baked in. The cost surfaces in the total repayment, not the monthly.
