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Old 03-14-2010, 08:36 AM   #181
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Wahoo, is it typical to be underwater on the note on a well maintained RV?
It's typical.

As Audrey and Rich said, the depreciation slope on a motor home is very steep the first few years. The Excel screen shot I attached below is an average of what happens to the value over a 20 year period.

I have no idea how lenders policies may have changed recently, but the guy I purchased ours from left his paperwork in the glove compartment . He had a 15 year note, and based on his monthly payment it was a straight line amortization loan. The MH was six years old at the time I bought it and paid 50% of his original purchase price.

Yep, he was definitely underwater.
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Old 03-14-2010, 11:10 AM   #182
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One trick if you are buying a new one, is to try to get 30% off MSRP. That way at least you aren't taking the first year depreciation hit. Even back in 2005 you could usually get close to that if you shopped the dealers carefully.

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Old 03-14-2010, 11:21 AM   #183
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I agree you should be able to get a big discount off the "list" price when buying new. However, my depreciation schedule and first year 30% hit is based on the purchase price, not the MSRP. A depreciation schedule based on MSRP would really water your eyes...
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Old 03-14-2010, 11:33 AM   #184
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Heh, heh, heh, heh

I'm just happy to think I could get 40%-50% of my money back after using it for 5-10 yrs.

The things gonna have some miles on it, so probably not. But it's a nice thought, anyway.
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Old 03-14-2010, 02:30 PM   #185
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Originally Posted by REWahoo View Post
It's typical.

As Audrey and Rich said, the depreciation slope on a motor home is very steep the first few years. The Excel screen shot I attached below is an average of what happens to the value over a 20 year period.

I have no idea how lenders policies may have changed recently, but the guy I purchased ours from left his paperwork in the glove compartment . He had a 15 year note, and based on his monthly payment it was a straight line amortization loan. The MH was six years old at the time I bought it and paid 50% of his original purchase price.

Yep, he was definitely underwater.
Very interesting. But I guess not much worse than many cars, if it is worse at all.

On this $100,000 purchase, what would he have had to put down? Is the lender usually a captive of the sales organization, or is it an arm's length lender who needs to make his money on the loan itself?

Cause without a big down payment it looks like there would be lot of risk in these loans. 15 years is along time. What kind of rate would one pay for a 15 year amortizing loan in today's environment?

Ha
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Old 03-14-2010, 02:34 PM   #186
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What kind of rate would one pay for a 15 year amortizing loan in today's environment?

Ha
When I bought mine they were talking something in the 7% area. Have no idea how much they wanted me to put down because 7% financing is not anywhere in the ballpark when my cash is earning just 1.4%.
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Old 03-14-2010, 02:42 PM   #187
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I agree you should be able to get a big discount off the "list" price when buying new. However, my depreciation schedule and first year 30% hit is based on the purchase price, not the MSRP. A depreciation schedule based on MSRP would really water your eyes...
The depreciation schedule I saw for our brand was similar to your numbers above, but it was based on the MSRP.

Audrey
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Old 03-14-2010, 02:55 PM   #188
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On this $100,000 purchase, what would he have had to put down?
This was back in the Spring of 2001 and the original purchaser put down somewhere in the neighborhood of 14%, 8% was shown as a trade-in and 6% in cash.

Quote:
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Is the lender usually a captive of the sales organization, or is it an arm's length lender who needs to make his money on the loan itself?
This was a third party bank loan.
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Old 03-14-2010, 03:16 PM   #189
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This was back in the Spring of 2001 and the original purchaser put down somewhere in the neighborhood of 14%, 8% was shown as a trade-in and 6% in cash.


This was a third party bank loan.
Thanks for this information. This is a very risky loan type I would think. No wonder our financial system stinks.

Good for you for getting a good buy for yourself!

Ha
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Old 03-14-2010, 03:19 PM   #190
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The depreciation schedule I saw for our brand was similar to your numbers above, but it was based on the MSRP.
Audrey
On further research, I believe you are correct and my posted depreciation chart is based on MSRP.

Here is what a dealer says about depreciation from selling price:

Quote:
As far as depreciation is concerned, it all has to do with how much
most people would expect in a discount from new to get them to opt
for a pre-owned coach. There are no hard rules, but the lower
inflation of new prices, the higher the depreciation. Also, the more
desirable the unit, the less the depreciation.

Overall in the industry a quick rule of thumb could be as follows:

15% first year, 10% in the second, 5% in the third year, and 2% thereafter.
I think his numbers are too optimistic and reality would show a more rapid price drop, especially in years three through five.
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Old 03-14-2010, 03:29 PM   #191
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On further research, I believe you are correct and my posted depreciation chart is based on MSRP..



Whatever I get for it, I'll consider it found money . . . just like Social Security.
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Old 03-14-2010, 03:45 PM   #192
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Very interesting. But I guess not much worse than many cars, if it is worse at all.

On this $100,000 purchase, what would he have had to put down? Is the lender usually a captive of the sales organization, or is it an arm's length lender who needs to make his money on the loan itself?

Cause without a big down payment it looks like there would be lot of risk in these loans. 15 years is along time. What kind of rate would one pay for a 15 year amortizing loan in today's environment?

Ha
Ha, here is what Pen Fed has up on their website. I consider them to be a more-cautious-than-average lender. RV loans have long been considered to be attractive because the borrower pool tends to be well above average vs. typical prime car loan borrowers and the like. Dunno what experience has been on RV loans in the downturn, but I suspect it has probably been within horseshoe close of prime car loan borrowers.

Variable New & Used RV and Travel Trailer Loan Rates‡3.5% APR
Initial rate; rate after 5 years is Prime + 0.25% variable12 year loan amortized as 20 years; up to 70% LTV$40,000 - $175,0003.74% APR
Initial rate; rate after 5 years is Prime + 0.49% variable12 year loan amortized as 15 years; up to 75% LTV$40,000 - $175,0004.15% APR
Initial rate; rate after 5 years is Prime + 0.9% variable12 year loan amortized as 15 years; up to 80% LTV$40,000 - $175,0005.15% APR
Initial rate; rate after 5 years is Prime + 1.9% variable12 year loan amortized as 12 years; up to 85% LTV$40,000 - $175,0003.5% APR
Initial rate; rate after 5 years is Prime + 0.25% variable12 year loan amortized as 20 years; up to 70% LTV$40,000 - $175,0003.74% APR
Initial rate; rate after 5 years is Prime + 0.49% variable12 year loan amortized as 15 years; up to 75% LTV$40,000 - $175,0004.15% APR
Initial rate; rate after 5 years is Prime + 0.9% variable12 year loan amortized as 15 years; up to 80% LTV$40,000 - $175,0005.15% APR
Initial rate; rate after 5 years is Prime + 1.9% variable12 year loan amortized as 12 years; up to 85% LTV$40,000 - $175,000Disclosures
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Old 03-14-2010, 04:50 PM   #193
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It all comes down to "you can't take it with you".

Back to the OP's premise that RV'ing "sucks", there were some brief periods in my life that I thought "life sucks". I am not in one of those periods, and having the new toy and planning all kinds of trip should keep life interesting for a while.

RV'ing does not suck!
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Old 03-14-2010, 07:33 PM   #194
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I see it as having an age range where it is good, say retirement to 75 or so. Many women don't want one once they are widowed or husband has a heart attack. They have at least a step or two to get in so wheel chairs don't work out well.

We have a pick up camper so we can haul a boat. Climbing into bed is hard even before we were 60 it is above the truck cab. The shower and kitchen are tiny but at least you have one so great for a week or so. I wouldn't want it without my man to put it on and off the truck, deal with the propane and generator and things so if he is gone it is for sale.

Camp trailers or RVs are much bigger but harder to drive and take more gas and you can't really haul and launch a boat. Since we are self contained we only need a parking spot so pulling off into the pull out in the woods off a logging road works. In parks we don't mind a small spot with a picnic table, power and water and fire pit as long as it has a boat ramp.
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Old 03-17-2010, 01:04 PM   #195
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I too have thought of the RV life but once you start to do the numbers it gets expensive. Especially since you will want to stay in nice parks. I found that I could rent a hotel room, like Comfort Inn, in a good location, purchase a fuel sipping car and have great location with no headaches and less $.

I like to keep things simple and flexible.
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Old 03-17-2010, 01:50 PM   #196
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I too have thought of the RV life but once you start to do the numbers it gets expensive. Especially since you will want to stay in nice parks. I found that I could rent a hotel room, like Comfort Inn, in a good location, purchase a fuel sipping car and have great location with no headaches and less $.

I like to keep things simple and flexible.
I don't see anyone on this thread implying that owning an RV is a cheaper way to travel. On the contrary, a search of the forum will find a number of threads where those of us who own RV's clearly say the cost is higher than going the more traditional car and hotel route.

In those same threads you'll also see questions such as: Have you checked under that Comfort Inn mattress for bed bugs? Dared to shine a UV light on the bedspread or carpet? Are you certain those sheets were changed? Do you know what who slept in that bed last night?

Just askin'....
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Old 03-17-2010, 01:57 PM   #197
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I too have thought of the RV life but once you start to do the numbers it gets expensive. Especially since you will want to stay in nice parks. I found that I could rent a hotel room, like Comfort Inn, in a good location, purchase a fuel sipping car and have great location with no headaches and less $.
I don't dispute the expensive part.

But your hotel analogy is not quite on the mark from our perspective. When we pull in for the night or week or two, our motorhome becomes a clean, very comfortable mini-condo. We have a clean king sized bed, a great sound system and HD-TV. There's a full kitchen with a full-sized refridge. We stock it up with tons of food of our choosing at grocery store prices. We enjoy the company of other travelers regularly. The parks often have trails and scenery. Our towed car (which I just bought) gives us full mobility. The trip is a little slower but you have an onboard restroom, can easily brew a pot of fresh coffee, and the non-driver can sit at the booth or on the sofa safely buckled in.

No bedbugs, mystery stains, adjoining rooms, depressing food, etc. I'm not saying one plan is better than the other but they are apples to oranges. Just another take.
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Old 03-17-2010, 02:01 PM   #198
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Our towed car (which I just bought) gives us full mobility.
OK, whadja buy?
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Old 03-17-2010, 02:28 PM   #199
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I don't see anyone on this thread implying that owning an RV is a cheaper way to travel. On the contrary, a search of the forum will find a number of threads where those of us who own RV's clearly say the cost is higher than going the more traditional car and hotel route.
For me, the rental income I get on my condo will more than offset campground fees, depreciation on my RV, and fuel. So life on the road is going to be cheaper than sitting here doing nothing. And way cheaper per-day than a typical vacation.

Now theoretically, I might save more by renting my place and living out of motel rooms. But motel rooms are depressing.
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Old 03-17-2010, 02:32 PM   #200
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OK, whadja buy?
Just replaced my Prius with a Scion xD, stick shift, massive 1.8L engine. Here is what it looks like.

Basic transportation, cheap, and more than enough for me to use as an ESR runabout. Zero to 60 by Thursday.

What kind of pickup are you towing?
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