Common Finance Terms

We want to help take out the stress or confusion when you are buying a car with us! Below are some of the most common finance terms you will hear and use when buying a car.

Annual Percentage Rate (APR)

A yearly rate that calculates the cost of debt and takes into account other factors like insurance and interest.

Asset

Something an individual owns that is worth money. This can be a home or car.

Blue Book

This is an abbreviation for "Kelley Blue Book". This is a guide for car buyers and sellers that help estimate the retail price of vehicles.

Contract

A formal document that secures a binding agreement to the financing of an asset.

Current Liabilities

Any debts that must be paid within one year.

Destination Charge

The cost of transporting the vehicle from the manufacturer to the dealership.

Down Payment

The amount of cash that a person pays upfront for an asset before financing a loan.

Gap Insurance

Covers the difference between the book value of a vehicle and the remaining balance you still owe.

Interest Rate

The amount charged on a loan - the cost of credit. This is typically expressed as a percentage.

Lease

Temporary ownership of an asset. This is similar to renting an apartment or house. Monthly costs and mileage allowances (in cars) are negotiated by a contract.

Mileage Charge

Charges that must be paid when the lease of a leased vehicle is over and the negotiated amount of miles were exceeded.

MSRP

Manufacturer's Suggested Retailed Price which is the recommended selling price of a vehicle. The dealer's price may be higher, or the buyer may be able to negotiate a lower price.

Vehicle Identification Number (VIN)

A number that a manufacturer assigned to a specific vehicle. This number can be used to track the history of the vehicle.

Stop in and see our Finance Manager with any questions you may have and see why our customers always say, "It's so easy to do business at Steet Ponte Nissan!"