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Major Purchases
| Term | Definition |
|---|---|
| Acquisition Fee | charged by a lessor to cover the expenses, usually of the administrative variety, that they incur in establishing said lease or loan. |
| Closed End Lease | a rental agreement that puts no obligation on the lessee to purchase the leased asset |
| Collateral | an asset that a lender accepts as security for a loan. |
| Dealer Incentives | financial inducement used by manufacturers to motivate dealers to sell a particular product by offering discounts on that product. |
| Default | failure to fulfill an obligation, especially to repay a loan |
| Deficiency | a payment made, typically by a government body, to cover a financial deficit incurred in the course of an activity such as farming or education. |
| Depreciation Fee | purchase price less the total depreciation taken to date. |
| Early Termination | Ending of the lease before the scheduled termination date for any reason, voluntary or involuntary |
| Finance Charge | assessed for the use of credit or the extension of existing credit. |
| Fixed Rate Loan | loans with an interest rate that does not change over time. |
| Inception Fees | Any fees that are due at lease inception. |
| Installment Loan | a loan you get in a lump sum and repay over time, with interest. |
| 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 |
| Mileage Allowance | an amount of money paid for every mile traveled |
| Mileage Charge | an allowance for traveling expenses at a certain rate per mile. |
| Money Factor | finance charge you pay on an automobile lease. |
| MSRP | manufacturer's suggested retail price. |
| Open End Lease | a type of rental agreement that obliges the lessee 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 contractual option granted by the lessor or owner under an Aircraft Agreement as to the purchase of the applicable Aircraft. |
| Rebates | a partial refund to someone who has paid too much money for tax, rent, or a utility |
| Residual Value | the remaining value of an asset after it has been fully depreciated |
| Secured Loan | a loan that's guaranteed with collateral |
| Trade-In Value | Fair Market Value. Should you offer to sell your current home or vehicle on the public market, you'll learn the fair market value of your asset. |
| Unsecured Loan | a loan that doesn't require any type of collateral. |
| Upside Down | a mortgage in which the owner owes more than the house is worth. |
| Variable Rate Loan | a type of loan where the interest rate changes with the 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 |
Created by:
cneubauer22
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