Making Vehicle Financing Easy
Buying a car can be one of life’s more stressful endeavors. The terminology alone is enough to fill a textbook. To make sure you are understanding the verbiage enough to make the best decision for you and your family, refer to this shortened glossary of car finance terms. If you want more information about terminology when buying a car, feel free to contact our finance department of Bob Ross Buick GMC in Dayton, OH with questions.
Bad Credit
It sounds simple, but people often don’t know when their credit is too low to be approved for an auto loan. Sources including the Consumer Federation of America and the National Credit Reporting Association have stated that bad (or “poor”) credit is usually at or below a FICO score of 600. Make sure your credit is in a good place before looking to purchase an automobile.
Equal Credit Opportunity Act (ECOA)
ECOA is a federally-mandated law that requires creditors and other lenders to make credit available equally without any discrimination based on race, color, religion, national origin, age, sex, marital status or receipt of income from public assistance programs. ECOA protects you from unfair treatment when applying for car loans.
Interest
A universal economic practice, interest is the amount a lender or creditor would charge a borrower for a loan. For example, if you borrow $10,000 at 1% annual interest to help pay for a car, the $10,000 you owe would rise by 1% every year until you have paid off your loan. Always look for low, fixed interest rates.
Refinancing
If your existing car loan is proving too burdensome, you can always rework your financing with a different lender, who will provide you with a new payment plan better suited to your current circumstances.
Title Loan
A title loan uses the equity you have in your vehicle (your ownership of the vehicle) as a form of collateral for a cash loan from a lender. The lender will hold your title until the loan has been paid off in full.
contact us
Hours Of Operation
Sales
- Monday
- Tuesday
- Wednesday
- Thursday
- Friday
- Saturday
- Sunday
- Closed