Glossary
Are you having a little trouble with some of the auto loan terms you've been hearing? We know it can be complicated process, especially if you've never purchased a vehicle before. In order to help the Washington Auto Financing visitors get a better understanding of the auto loan process, we've created a glossary full of the most common terms people misunderstand. Whether you plan on purchasing a vehicle soon or just want to look around, take a moment to brush up on these important auto loan terms:
- Amortization - The repayment of an auto loan through regularly scheduled payments.
- Balance - The amount of money remaining to be repaid on an auto loan.
- Base Price - Refers to the cost of a vehicle before any dealer added options.
- Credit Score - A number used to express one's creditworthiness. Credit scores play a vital role in determining auto loan interest rates.
- Default - Failure to comply with the terms of a loan. Borrowers who default on their loans could potentially have their vehicle seized.
- Delinquent - The late payment of a loan.
- Down Payment - When purchasing a vehicle, the down payment refers to the amount of money a person pays in cash and up front.
- Interest - A lender's charge for issuing a loan, applied as a percentage of the loan total.
- Interest Rate - The annual rate of interest on a loan, expressed as a yearly percentage.
- Lender - The individual or company that issues auto loans to borrowers.
- MSRP - Also referred to as Manufacturer's Suggested Retail Price, this is the a vehicle's recommended selling price according to the manufacturer.
- Off-Site Financing - Obtaining an auto loan through a bank, credit union, or some type of lender not affiliated with a car dealership. Washington Auto Financing can help you find the perfect off-site financier online today!
- On-Site Financing - Obtaining an auto loan through the auto loan dealership selling the vehicle.
- Principal - The total amount of an auto loan, not including any interest charges.
- Term - The length of a loan. Auto loans typically have terms ranging from 3-6 years.
- Title - Legal documents that provides vehicle proof of ownership.
