Cash or Credit?

[arcaguy]

Did you pay cash for your rig? Did you buy it from a dealer or a private party? Inquiring minds want to know.

[Isaac-1]

Bought from a private party, financed over 4 years, could have paid cash, but would have taken a bigger tax hit, etc. from selling stocks to get the cash on hand to pay cash. Also the stocks were earning a higher dividend return than the interest was on the loan, so paying cash would have been a double whammy.

[blueridge-fl]

Originally Posted by Isaac-1

Bought from a private party, financed over 4 years, could have paid cash, but would have taken a bigger tax hit, etc. from selling stocks to get the cash on hand to pay cash. Also the stocks were earning a higher dividend return than the interest was on the loan, so paying cash would have been a double whammy.

This hits the nail on the head. Before retirement, I thought people that got loans during retirement were nuts. Now that I'm there, I understand the downside of taking a big chunk of cash out of investment accounts. Its often better to get a loan.

[Tha_Rooster]

This is a topic that get posted regularly. This is what I get out of it. I have a buddy just ordered a new mountainaire should arrive in June or so paying cash he can afford it without selling their S&B like many do. While others need to finance a small travel trailer. So if you can afford paying cash or not doesn’t make you a good or bad person it’s all about peoples person financial situation.

[boomersooner]

Bought new from dealer. Put over half down, financed $100k about 2 months before retiring from full time work. Took consulting job for about 16 months, paid RV off about 3 months before retiring full time. If I had bought a new gas model would have paid cash but DW liked the diesel so needed to finance some. Financed $100k because the interest rate was lower on $100k and up. Only investments I touched were $35k from Roth to pay off balance. Love having nearly new RV with no payments and investments still intact.

[dizcom]

This comes up from time to time. Dealer or private: get an inspection. Cash or finance: depends on your financial situation. We've done both, of both.

[Winger2]

It always depends on your net worth, cash flow, investments and interest rates. I would consider a loan under 4% on a mh, over that I would not even think about it.
Friends laughed at me once, because I bought a new car for cash and financed a golf cart.Hell yeah, zero %, I will finance everytime.

[Psneeld]

I agree it depends on many factors.

This may not work now, but considering the situation at the time 3 years ago when I bought my MH....I financed about 2/3. Paid it off in about 2.5 years...made enough on investments to pay off the loan and interest and came out thousands of $$$ ahead...

Just did similar with a newish Ford Ranger toad...bought in November and when I pay it off in a couple months I will be an estimated $500 dollars ahead of paying cash.

The motorhome never met the threshold for 2nd dwelling tax writeoff, but in some circumstances that would have sweetened the deal.

All my life has been a cash only for toys.... but sometimes the pendulum swings and ya gotta run the numbers up front, make an educated guess and roll the dice.

[Winemaker2]

Here's a thread with 200 posts re the same financing question.... just a different toy.
https://www.trawlerforum.com/forums/...ad.php?t=56347
My philosophy is #191

You will find a similar diversity of opinions re private / dealer. I've done both and IMO finding the right unit for your needs should be the primary factor... then which has the best deal if equally satisfactory units?
Psneeld... look familiar?

[terntes]

Another point of view!

We financed, bought from Camping World and we had to buy the $$$$ warranty package. The finance officer told us we could not buy the motorhome without the warranty package because if something happened requiring warranty work it would look bad on Camping World if they would not fix the problem. Would this still happen if we paid cash? Has anybody had this experience?

[BillJinOR]

Originally Posted by terntes

Another point of view!

We financed, bought from Camping World and we had to buy the $$$$ warranty package. The finance officer told us we could not buy the motorhome without the warranty package because if something happened requiring warranty work it would look bad on Camping World if they would not fix the problem. Would this still happen if we paid cash? Has anybody had this experience?

Shady finance guy at CW bags another. They outright lied to you. Nobody “needs” the warranty. Insurance on loss on financed things ? yes, but never a “warranty” actually a service contract!. If there’s still time get your money back! File a complaint ( however it’s only your word he said that) Sadly many don’t know their rights and believe this stuff. [emoji15] loan companies do not require any of that stuff.

[Old-Biscuit]

I'm not a high finance guy....but did manage to retire before I turned 50 thanks to following advice my Mom gave me

Debt free other then S&B Mortgage my whole life

Ordered New truck and New 5th wheel prior to going FT
Paid Cash cause I could W/O dipping into investments/retirement funds

Still Debt Free except for S&B Mortgage

[Dav L]

Now-a-days really depends on the cost of money. My mortgage interest is so low (2.75%) I don't want to pay it off. The money is earning much more in investments and the interest is tax deductible. Mortgage company offered a refinance at 1.99%...but the closing costs didn't make sense to do so. I like the idea of paying it off, but it just doesn't make financial sense.

[Mr_D]

I make more on my annuity than the interest I pay. It doesn't make sense to take money out of my annuity that pays 7% to pay off a 5% loan.