Caravans can be a great way to have a UK holiday at your fingertips. A caravan is more than just a vehicle - it represents flexibility and freedom! Many people are therefore keen to buy a caravan on finance, but there are a few things to consider first. For instance, what sort of options are available? What are the eligibility requirements? Can you get caravan finance with bad credit? To help you get started, we’ve explored caravan loans in more detail below!

Caravan Finance UK Options 

When it comes to buying a caravan, they can be costly to purchase outright. That’s why many people opt to cover the cost through finance options. There are two main types of caravan finance to choose from - personal contract purchase and hire purchase. We’ve outlined these below:

Personal Contract Purchase 

With a personal contract purchase agreement, you’re paying off what is known as the depreciation of the caravan. This means that you’re paying the difference between what the caravan is worth at the start and end of the contract. Then, once the agreement comes to an end, you can choose to pay a balloon payment, which will be the outstanding value of the caravan. Alternatively, you can hand it back, or enter into another agreement.

Hire Purchase

A hire purchase agreement is similar to any other type of loan, in that you make equal monthly instalments throughout your loan term. Generally, you'll need to pay a deposit upfront, and then your repayments will contribute towards the value of the caravan, plus interest. Once you reach the end of your agreement, you’ll own the caravan outright.

caravan driving

Touring Caravan Finance Eligibility 

Not sure if you’ll be eligible for caravan finance? There are four main eligibility criteria you’ll need to meet for any type of vehicle finance, which we’ve listed below. You’ll need to be:

  • Aged 21 or over
  • In possession of a full or provisional driving licence
  • Earning at least £1,000 a month net pay
  • A UK resident

Here at Wheelie Good Finance, we work with a wide range of vehicle finance providers, each of which will have slightly different eligibility requirements. So when you apply for a caravan loan through us, you’re bound to find a lender that can help, no matter what your situation! 

No Deposit Caravan Finance 

A lot of people assume that you need to put down a deposit on any vehicle you buy on finance, but this is not the case! Some lenders do offer no deposit finance, so you may not need to put down a lump sum in order to purchase a caravan. 

It’s not always easy to save up for a deposit, especially if it’s a large sum. And if you’ve already got your heart set on a particular caravan, you may not want to wait! Just keep in mind that if you’re able to pay a deposit, it’s probably a good idea to do so. Making an initial contribution towards the cost of the caravan can lower your repayments moving forward.

Bad Credit Caravan Finance 

Having a bad credit history can make taking out further credit more difficult. But that doesn’t mean it’s impossible! Even if you have a poor credit score, one of the lenders we work with may be able to help. They’ll take other things into consideration, alongside your credit rating, such as your employment history and monthly budget. 

Even if you’re looking for CCJ or IVA vehicle finance, one of our lenders may be able to help. Many vehicle loan providers specialise in bad credit finance, and will be more concerned with your affordability than your credit score.

parked caravan BBQ

What Type of Caravan Should I Buy?

When buying a caravan, you don’t just need to think about your finance options, you also have to consider the type of caravan. And while there may not be as many makes and models available as there are for cars, there are still loads of caravan models to choose from! To help you decide, we’ve explored four key considerations below: 

Consider the Size

It can be tempting to just opt for the biggest caravan on the market. But a huge caravan may not be practical, and if you’ve never towed a caravan before, it might be sensible to start small. And if you are concerned about getting a caravan that’s too big, you may find it useful to know that legally, any car can tow a caravan that’s up to 7 metres long and 2.55 metres wide. 

Single or Double Axle?

Caravans are notoriously difficult to manoeuvre when being towed. And whether your caravan has a single or double axle will make a big difference to this. But bear in mind that a caravan with a double axle is likely to be a much bigger, heavier model than one with a single axle. 

How Powerful is Your Car?

You may have towed caravans in the past, but has your car? You don’t want to find your dream caravan, only to learn that your car isn’t up for the task of towing it. You’d then have to decide whether to keep searching, or get another car! 

The easiest way of determining whether your vehicle can rise to the challenge is by checking its handbook. Here, you’ll be able to find the car’s towing limit. Then, simply filter out caravans that exceed this limit. 

Caravan Usage

Do you intend to sleep in your caravan? If so, it’s a good idea to check whether the beds are long enough! Consider the size of the caravan in general, when it comes to functionality, and think about what facilities matter most to you. Finding a caravan with the perfect layout may be more challenging than you think, but thankfully there are a huge variety of options!