Understanding Auto Loans Jargon
Nationwide Auto Lending writes consumer articles pertaining to the auto loan industry focused on helping customers to better understand auto loans and how they work.
Understanding Auto Loans Jargon [Articles]
April 27, 2011, 9:25 am
You will be confused when meeting that car dealer or credit provider to inquire about auto loans and the he mentions things like seller sticker cost, dealer invoice value among others which are foreign to you. There are four major terms you should be conversant with so that you do not end up shaking your head or nodding to something you have no idea about and that inner voice is asking you, “What is he talking about?”
Seller sticker cost is the public cost of the car that is on display at the warehouse or dealer-shop usually put on the windscreen and is usually the recommended retain price abbreviated as MSRP. At times this sticker cost is usually fixed while other dealers let you have a bargaining benefit where you could negotiate on the last price. Whichever the case, give a shot at bargaining, you never know.
Rebate is usually a gift to buyers that originates from the manufacturer or even dealer to entice them into buying a certain new model introduced into the market or slow selling cars. Rebate can come in two forms which might be low purchase price or lowering of the interest rate on the auto loans.
The annual percentage rate or APR which is calculated every year is a consolidation of all fees and expenses on auto loans. This APR differs from one dealer to the other and therefore you need to remember this. The loan period might be held together with the APR and therefore the monthly installments, taxes and closing costs among other charges will be counted and consolidated into the APR.
We earlier mentioned dealer invoice value. This occurs when dealers buy at manufacturers and pay them this indicated value which creates a difference between dealer prices and recommended retail prices of which you can take advantage.
