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Major Purchases
| Term | Definition |
|---|---|
| Acquisition Fee | An acquisition fee is a fee you pay when leasing a car or other types of vehicles. |
| Closed End Lease | Closed-end leasing is a contract-based system governed by law in the U.S. and Canada. It allows a person the use of property for a fixed term, and the right to buy that property for the agreed residual value when the term expires. |
| Collateral | something pledged as security for repayment of a loan, to be forfeited in the event of a default. "she put her house up as collateral for the bank loan" |
| Dealer Incentives | A dealer incentive is a financial inducement used by manufacturers to motivate dealers to sell a particular product by offering discounts on that product. |
| Default | In finance, default is failure to meet the legal obligations of a loan, for example when a home buyer fails to make a mortgage payment, or when a corporation or government fails to pay a bond which has reached maturity. |
| Deficiency | a lack or shortage. |
| Depreciation Fee | an amount in accounting that is commonly a fixed percentage of the original cost of a property and that is periodically charged off to expense or against revenue in order to compensate for the depreciation of the property. |
| Early Termination | Early termination contract refers to the dissolution of a contract before the term of that contract has concluded. This will usually occur due to breach of contract, which involves a party failing to uphold the terms of the contract they signed. |
| Finance Charge | A finance charge is a fee charged for the use of credit or the extension of existing credit |
| Fixed Rate Loan | A fixed interest rate is an unchanging rate charged on a liability, such as a loan or mortgage. |
| Inception Fees | The initial set of fees that you would need to pay when you lease a car. |
| Installment Loan | An installment loan is a type of agreement or contract involving a loan that is repaid over time with a set number of scheduled payments; normally at least two payments are made towards the loan. |
| Invoice Price | The invoice price is the actual price that the end-customer retailer pays to the manufacturer or distributor for a product. |
| Lease | a contract by which one party conveys land, property, services, etc. to another for a specified time, usually in return for a periodic payment. |
| Lessee | a person who holds the lease of a property; a tenant. |
| Lessor | a person who leases or lets a property to another; a landlord. |
| Mileage Allowance | Mileage allowance is a term the Internal Revenue Service (IRS) uses to refer to the deductibility of expenses car owners accrue while operating a personal vehicle for business, medical, charity, or moving purposes. |
| Mileage Charge | Mileage charge means the rate assessed by a surface or water ambulance service, measured in miles from the point at which the ambulance receives the patient to the point of final destination (loaded miles). |
| Money Factor | The money factor is a method for determining the financing charges on a lease with monthly payments. |
| MSRP | MSRP, meaning Manufacturer's Suggested Retail Price, is the price that a manufacturer recommends for stores to sell their product. |
| Open End Lease | a type of rental agreement that obliges the lessee (the person making periodic lease payments) to make a balloon payment at the end of the lease agreement amounting to the difference between the residual and fair market value of the asset. |
| Purchase Option | A purchase option is a right to purchase or lease land or other property interests without any obligation to do so. |
| Rebates | a partial refund to someone who has paid too much money for tax, rent, or a utility. |
| Residual Value | The residual value, also known as salvage value, is the estimated value of a fixed asset at the end of its lease term or useful life. |
| Secured Loan | A secured loan is a loan in which the borrower pledges some asset as collateral for the loan, which then becomes a secured debt owed to the creditor who gives the loan |
| Trade-In Value | Trade-in value is basically a car dealership's valuation of your car when you opt for a trade-in. |
| Unsecured Loan | unsecured debt refers to any type of debt or general obligation that is not protected by a guarantor, or collateralized by a lien on specific assets of the borrower in the case of a bankruptcy or liquidation or failure to meet the terms for repayment. |
| Upside Down | with the upper part where the lower part should be; in or into an inverted position. |
| Variable Rate Loan | A variable interest rate is a rate on a loan or security that fluctuates over time because it is based on an underlying benchmark interest rate or index. |
| Warranty | a written guarantee, issued to the purchaser of an article by its manufacturer, promising to repair or replace it if necessary within a specified period of time. |
Created by:
jaycebalestrieri
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