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Question | Answer |
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acquisition fee | a charge from a lender or lessor to cover the expenses incurred for arranging a loan or lease agreement. |
closed end lease | a rental agreement that puts no obligation on the lessee (the person making periodic lease payments) to purchase the leased asset at the end of the agreement. |
collateral | something pledged as security for repayment of a loan, to be forfeited in the event of a default. |
dealer incentives | a financial strategy used by manufacturers to motivate dealers to sell their products by offering discounts on those products |
default | failure to fulfill an obligation, especially to repay a loan or appear in a court of law. |
deficiency | the numerical difference between the amount of tax that a taxpayer, or taxpaying entity, reports on a tax return and the amount that the Internal Revenue Service (IRS) determines is actually owed. |
depreciation fee | the value of a fixed asset minus all of the accumulated depreciation that has been recorded against it |
early termination | the dissolution of a contract before the term of that contract has concluded. |
finance charge | the cost of consumer credit as a dollar amount |
fixed rate loans | a loan where the interest rate doesn't fluctuate during the fixed rate period of the loan. |
inception fees | Any fees that are due at lease inception |
installment loan | 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 initial price that the manufacturer charges the dealer |
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 | the deductibility of expenses car owners accrue while operating a personal vehicle for business, medical, charity, or moving purposes. |
mileage charge | 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 |
money factor | a method for determining the financing charges on a lease with monthly payments. |
MSRP | The list price, or the recommended retail price, or the suggested retail price of a product is the price at which its manufacturer notionally recommends that a retailer sell the 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 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 | It describes the future value of a good in terms of absolute value in monetary terms and it is sometimes abbreviated into a percentage of the initial price when the item was new. |
secured loan | 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 | a car dealership's valuation of your car when you opt for a trade-in. |
unsecured loan | 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 | the situation when you buy something on credit and now owe more for it than it is worth. |
variable rate loan | a type of loan where the interest changes according to changes in market interest rates. |
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. |