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To use the caravan loan calculator, you’ll need to enter some details about your loan. These are explained below:
Once you have filled in your caravan loan details, simply click ‘See My Repayments’ to view an estimated repayment amount. You can then select Monthly, Fortnightly, or Weekly repayments to see what your repayment amount will be at various frequencies.
The caravan loan calculator uses what is called an amortisation calculation - a process of calculating the gradual repayment of your loan amount over time.
For example, when you make your first repayment on your caravan loan, a greater portion of the amount will go toward repaying the interest. As you continue to meet your repayments, the portion of interest paid on each amount will decrease, and the portion paid on your principal amount will increase.
Caravan loans are generally secured by the caravan or motorhome, and offered for a fixed rate over a fixed term. Calculating your repayments this way will not only give a more complete representation of repayments, but also allow you to determine the amount of interest you will pay over the term - or save if you are able to repay the loan early.
When expressed a mathematical formula, calculating your caravan loan repayments can seem somewhat complex. Don’t be concerned! Once you understand how amortisation works and the interest is calculated on a loan amount over time, you should be able to make the calculations on your own.
The simple formula for calculating Loan Repayments is: Loan Amount / Discount Factor
The complexity of the calculation is in determining the discount factor, which is calculated by dividing the interest rate of your loan by the number of payments per year (12 for monthly, 26 for fortnightly, or 52 for weekly) to first obtain the Periodic Interest Rate.
The formula is expressed as: (((1 + i) ^n) - 1) / (i (1 + i)^n)
|Caravan loan amount||5% interest||7.5% interest||10% interest|
In the example below, we’ll look at an individual wanting to purchase a $60,000 motorhome. They don’t provide a deposit, however they do trade their current vehicle in to the value of $20,000. Accounting for this, their caravan loan is $40,000, and they agree to a 7.5% fixed interest rate and a repayment term of 5 years.
If you want to quickly calculate your repayments without creating your own spreadsheet with the above calculations, you can use our free caravan loan calculator.
To qualify for a caravan loan in Australia, you will need to be over the age of 18, a permanent resident or citizen of Australia, able to verify that you earn a steady income, and most importantly prove your ability to repay the caravan loan amount.
Secured caravan loans will generally use fixed interest rates offered between 5.00% and 29.90%. You can get the best interest rates on a caravan loan by purchasing the vehicle from a franchise or dealership, however you are still able to obtain reasonably low rates if you wish to purchase the vehicle through a private sale.
Yes, you can get a caravan loan with bad credit. Bad Credit Caravan Loans are offered by non-bank lenders and will have higher interest rates than standard caravan loans. You will still need to prove your ability to meet repayments, and it is very likely that you will be asked to provide extensive supporting documentation to the lender.
The average amount for a caravan loan in Australia is $30,000. Most lenders will approve a secured caravan loan application for anywhere between $5,000 and $100,000. The amount you are able to gain approval for will depend on your personal borrowing profile, which will be assessed according to your income and credit rating.