my credit union won't finance a cargo van purchase..

[Vanda]

..if my intention is to convert it.

Hi all,  I was hoping my first post here would be a happier one but I was disappointed to receive this news yesterday from my credit union and was hoping for some feedback from you all.  Longish story short, I applied online for a loan, was approved, but the pre-approval was revoked once they found out I intended to convert it.  I cut our phone call short yesterday because 1) I was at work and 2) I was disappointed.  

I guess my questions are: is this just a stipulation set by my credit union or are all banks this particular?  Obviously I will be able to get a loan somehow from somewhere, but do I need to by sly (not lie, just...not so forthcoming) about my plans for the van?  Were you all able to get regular car loans or did you have to go the rv loan route?  Why is my credit union being such a jerk (   ) ?

I'll call my credit union to see if there are any options (higher interest rate, lower loan amount, rv loan, etc), I'm just curious if any of you experienced something like this at the onset of your search.  Thanks for letting me vent a bit!

 

[MrNoodly]

Are you able to save up enough to pay cash for a used van?

 

[Vanda]

No. I will be trading in my current vehicle and putting no cash down. My plan is to move into the van full time thereby eliminating my rent payment.

 

[Riverman]

Welcome to the forum, it's good to have you here.

 

[Vanda]

Are you able to save up enough to pay cash for a used van?

PS - I dig the blog.

 

[John61CT]

My assumption with any bureaucracy is to feed them all the info they require in a form that raises no eyebrows, everything flowing in the usual well-worn tracks laid down by the thousands of conventional citizens that have come before me.

Pretend you are seeking the hand of your love from a strictly religious and conformist burgermeister with complete control over her life.

Anything unconventional suggesting freedom from society's dominant mores just sets off red flags.

Note I am not saying to lie outright or defraud. For example, these days the gig economy like Uber and Amazon deliveries, TaskRabbit etc lets anyone with a van become an independent commercial carrier without long-term commitment.

The other rule is other than the above, keep your mouth shut, sure make small talk be human, but don't volunteer any "extra" information beyond what they need to know to give you what you want.

 

[lenny flank]

Many insurance companies won't cover a self-converted vehicle. They're afraid the owner will eff something up and burn it to a crisp--and the insurance company will have to pay for it.

 

[Weight]

You must keep the vehicle as purchased as the loan company owns it until you pay it in full. If you modify it maybe worth much less if you fail to make payments. Repo Man.

 

[mayble]

shop around for other financing, and don't tell them your plans
if my bank or my insurance company were to ask (tho they haven't, and aren't likely to), i'd simply say i bought a van to carry my camping gear while i travel
the idea of "conversion" doesn't enter the conversation

 

[mayble]

You must keep the vehicle as purchased as the loan company owns it until you pay it in full. If you modify it maybe worth much less if you fail to make payments. Repo Man.

respectfully disagree here.
the finance company has a lien on the vehicle but doesn't own it.  if they have to repo and can't recoup their investment, they'll simply come after you for the difference.
absolutely nothing in my loan documents said i couldn't cut a big hole in the roof, which of course is the very first thing i did.

 

[Vanda]

John61CT, I like the way you think, sir.

I naively didn't realize that until I own my van outright, I am at my lender's mercy.  Silly me.

 

[WalkaboutTed]

We went through the exact experience. We had financed my 2016 cargo van with Navy Fed Credit Union. Exactly one year later, we were buying the same van. Then Navy Fed said that they will no longer finance commercial vehicles, even if they were for personal use.

So we went to a local credit union. They would finance a commercial van as long as the GVWR is less than. 10,000lbs. The van is 9990lbs GVWR so we were good.

But the local credit union said that we weren't allowed to make permanent modifications on the van. No problem, everything is screwed in and the entire "temporary" conversion can be removed in a matter of hours. But they'd have to repo the van to know. The van loan is upside down for a few more years, in any case. But they're not going to repo unless I can't make payments. If that were to happen, I'd be going bankrupt. And by then, if things were that bad, I would have no attachable assets for them to grab. They can't take my trailer, because in AZ, you can claim an RV as a homestead, which makes it an exempt asset.

The moral of the story is to go to other loan providers. Worst thing is they'll say no. And you can make as many credit inquiries for a vehicle as you want with only the one hit-as long as you do all the inquiries within 30 days.

Good luck,
Ted

 

[tx2sturgis]

Tell them it's a cargo van for personal use. You plan to sell crafts at craft shows or you will be forming a local band. Figure out something that's harmless and will keep them happy.

 

[TMG51]

Soo... why'd you tell them you plan to modify the van? :huh:

 

[Riverman]

Another big step is van insurance... they will ask what are you using the van for? PERSONAL USE.

 

[Vanda]

"And you can make as many credit inquiries for a vehicle as you want with only the one hit-as long as you do all the inquiries within 30 days."

Ted - I did not know that, thank you for that info.

Thank you everyone for the feedback.  It is much appreciated.  I will start looking at other lenders asap and will plan on being a little more discreet.

 

[Vanda]

Soo... why'd you tell them you plan to modify the van? :huh:

She outright asked me if I was planning on converting it and I didn't want to lie  :-/

 

[Burbanlife]

You are buying the van, the lender does not need to know of any MODIFICATIONS. period. I use a credit union and never ever been asked what I intend to do with said vehicle. go back and start over is what I would do. you can do what you want with it in my book, as even if you cant pay and vehicle was not modified they will sell it and take whatever they get and if the loan is not satisfied they will still then come after you for the balance that is how it works.

 

[GeorgiePorgie]

It seems like you could buy the van with no plans to convert it and shortly afterwards develop an interest in camping.

 

[sreesekelley]

I've seen questions about people not getting financed / insured on other forums as well. Doesn't make any sense to me. The only question I've ever been asked is how much money do you make and what is the name of your insurance company. Stipulation of non commercial use would be an insurance thing not a financing thing. I might need a van to haul bodies or raw chicken crap for my vegetable garden. As long as i make the payments why would a credit union or bank care? if I don't make the payments they will sell it at auction and I would be on the hook for any shortage and conversely if they sold it for more than i owed I would get the balance. financing and insurance are figured out by goulish actuaries who live in dungeons and only care about numbers in my experience. I think I would personally look for a different finance institution if they started delving into my personal life beyond my ability to make the payments. I wouldn't sign a contract for financing that required me to notify the bank every time I wanted to haul something other than air.