Written byShaun McGowan
Researching caravan loans and want to know what interest rate you’ll get with your credit score? There are lots of factors that can influence your caravan loan interest rate, and one of the most important to lenders (and often overlooked by those applying!) is your credit score.
Your caravan loan interest rate is calculated based on your credit score, which is a summary of your financial history and lenders look at it as a reflection of your ability to make repayments as a trustworthy borrower.
The higher your credit score is, the lower your level of risk is as a result and the better your chance at gaining approval and a great interest rate.
Lower credit scores don’t necessarily mean you won’t be approved or will only be approved for caravan loans with high interest rates, it just means that you’ll be required to provide more supporting information if you want to access a better deal from a lender, you may also have to work with a lender who specialises in bad credit personal loans.
In short, a higher credit rating just makes it easier to get lower caravan loan interest rates - so there’s very little reason not to consider understanding and improving your credit score before applying.
If you are only taking your credit score in to account when applying for a caravan loan:
It’s also important to understand that interest rates aren’t the only indicator of a good deal on caravan finance, and that caravan loan interest rates are determined by several factors, not just your credit score:
Important: No matter what your credit rating, you’ll find much better rates when you apply for a secured caravan loan vs an unsecured personal loan, as the value of the collateral (the caravan) greatly decreases the risk to the lender.
If you’re more interested in saving money than just getting a good deal, it’s important to consider the length (term) of your loan. The sooner you repay your loan amount, the greater the amount of total interest you will save.
If you’re wanting to get a better caravan loan interest rate by improving your credit score, you have two main options to consider.
Only you will be able to decide which option is more suitable for your situation.
You can check your credit score for free and without any impact on your credit score with Money Matchmaker®.
You'll need to create an account with these details:
Your score won't be negatively affected and we protect your data with encryptions.
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Shaun is the founder of Money.com.au and is determined to help people pay as little as possible for financial products. Through education and building world class technology. Previously Shaun co-founded CarLoans.com.au and Lend.