RV Park Financing and Campground Loans: A Complete Guide for Buyers

RV Park Financing: Navigating Debt for Campground Acquisitions

Financing is often the most complex part of an RV park or campground transaction. The asset class sits at the intersection of commercial real estate and small business lending, which means borrowers have access to multiple loan products but also face confusion about which one fits their specific deal.

This guide covers the primary debt options available to campground buyers and operators, with practical guidance on what lenders look for and how to position your deal for the best terms.

SBA 7(a) Loans

The SBA 7(a) program remains the most popular financing option for campground acquisitions under $5 million. The government guarantee reduces lender risk, which translates to lower down payments and longer amortization for borrowers.

Typical SBA 7(a) terms for campgrounds include loan amounts up to $5 million, amortization periods of 10 to 25 years depending on real estate collateral, down payments of 10 to 20 percent, and rates pegged to the prime rate plus a spread typically ranging from 1.75 to 2.75 percent. Borrowers need to demonstrate relevant management experience, provide personal guarantees, and show that the property generates or will generate sufficient cash flow to service the debt. SBA lenders also require that the borrower occupy and operate the property, which means this product is designed for owner-operators rather than passive investors.

USDA Business and Industry Loans

For campgrounds located in rural areas, USDA Business and Industry loans offer an alternative to SBA financing. These loans can go up to $25 million and come with competitive rates and longer terms. The catch is the rural location requirement. The property must be in an area that meets USDA rural definitions, which excludes most properties near major metro areas. However, many campgrounds naturally sit in rural locations, making this a strong fit for the right deal.

Conventional Commercial Loans

Banks and credit unions that understand the campground industry offer conventional commercial loans for stabilized properties. Terms vary widely but generally include 5 to 10 year terms with 20 to 25 year amortization, loan-to-value ratios of 65 to 75 percent, fixed or variable rates depending on the lender, and debt service coverage ratio requirements of 1.25 or higher.

The biggest challenge with conventional lending for campgrounds is finding a lender who understands the asset class. Many traditional commercial lenders view RV parks as specialty real estate and either decline the deal outright or impose conservative terms. Regional banks in markets with heavy camping activity tend to be more receptive.

Bridge Loans and Private Capital for RV Park Financing

Bridge loans fill a critical gap in campground financing. They are designed for situations where the property does not yet qualify for permanent debt, typically because it needs improvements, has below-market occupancy, or is undergoing a change in use.

Common scenarios where bridge capital works for campgrounds include acquiring a park that needs infrastructure upgrades before it can attract conventional financing, purchasing a seasonal park and converting it to year-round operations, adding glamping units or cabins that need time to ramp revenue, and buying a park out of distress or foreclosure where speed of close matters.

Bridge loans for campgrounds typically feature 12 to 24 month terms, interest rates ranging from 9 to 13 percent depending on the deal, interest-only payments during the bridge period, loan-to-value ratios of 60 to 75 percent, and the ability to close in 2 to 4 weeks.

At Requity Lending, we have financed RV park and campground acquisitions where the value-add business plan required bridge capital to execute. The typical path is to acquire with a bridge loan, complete improvements over 12 to 18 months, stabilize the property, and then refinance into permanent SBA or conventional debt at significantly better terms. Learn more about our bridge lending programs.

Seller Financing

Many campground transactions include some form of seller financing, particularly when the seller is a long-time owner-operator looking to defer capital gains or when the property has characteristics that make institutional lending difficult. Seller financing can be a standalone solution or layered with an SBA loan to reduce the cash equity requirement.

Terms are negotiable but commonly include 5 to 10 year amortization, interest rates of 5 to 8 percent, and a balloon payment at maturity. The key advantage is flexibility since the seller already knows the property and is motivated to see the buyer succeed.

What Lenders Look For

Regardless of which financing product you pursue, lenders evaluating campground deals focus on trailing 12-month financials showing revenue trends and operating margins, occupancy data broken down by season and by transient versus long-term sites, capital expenditure needs and deferred maintenance, management experience of the borrower or operator, market demand indicators such as proximity to tourism drivers and competition in the area, and environmental assessments for flood zones, wetlands, or contamination risk.

The borrowers who close the best deals come to the table with clean financials, a clear business plan, and realistic projections. If you are preparing to acquire a campground and want to understand your financing options, explore Requity Lending or start your application.