Credit: There are several facets to credit. Usually in auto financing, it’s used to refer to your credit history or credit score, which is a record of how you manage debt and is used by financial institutions to determine whether or not you should be approved for a loan.
Depreciation: The amount by which a vehicle’s value decreases over time. New vehicles depreciate faster than used vehicles.
Down Payment: The amount of money you pay for a vehicle up front. A larger down payment will result in lower monthly payments, due to the fact that you’re reducing the amount of money you owe on the vehicle.
Equity: If you owe less than the total value of a vehicle, you have positive equity in that vehicle.
Incentives: Find out what incentives you qualify for! Recent college grads get discounts from a lot of automakers, including Nissan, and being in the armed services will get you a discount pretty much anywhere.
Interest: Usually expressed as an annual percentage rate, interest is the amount of money charged to a borrower to compensate for a loan. This is how lenders make money off of car loans.
MSRP: Stands for “manufacturer’s suggested retail price.” Dealers are free to use this as a guideline; the actual price may be higher or lower than the MSRP.
Title: A document that proves your legal ownership of a vehicle.
Trade-In Value: When purchasing a new vehicle, you can trade in a used one and put the value of the old vehicle towards the new one. The old vehicle’s trade-in value is used to determine how much you still owe.