The size of your monthly payment is affected by a variety of factors, including the borrowed amount, interest rate and loan term. Loan payment schedules usually operate on a monthly basis. Payment schedule: The schedule for loan repayment from day one of borrowing up until the balance hits zero.This is the projected timeline for how long it takes to pay back a loan in its entirety Lien: A lien is a legal claim that party X has over an asset of party Y, until Y fulfills their end of an agreement.Note that prequalification isn’t a guarantee of financing, nor does it replace the formal application process (though it may help speed it up). Prequalification: Prequalification gives an idea of loan eligibility.Credit score: Put simply, a credit score is a number summarizing a borrower’s credit report and helps lenders assess the potential risk of lending money.The bigger the down payment, the less borrowed and therefore, the less owed on both principal and interest over time. Down payment: An upfront lump sum that goes toward the purchase price.APR takes interest into account, in addition to some other fees and costs associated with the loan and gives a more complete look at the cost of borrowing. Though it relates to interest rates, it’s not the same thing. Annual percentage rate (APR): APR is another percentage rate you’ll see associated with loans. Interest rate: The cost of borrowing money, typically expressed as a percentage on the principal.Principal: The amount of money borrowed.As you research auto loans further, you’ll likely come across several terms you may not be familiar with: You borrow money from a lender to use toward the intended purchase - in this case, buying a car - to be paid back, plus interest, over time. What is an auto loan?Īt its most basic, an auto loan is a form of credit. Getting a new car can be an exciting adventure, driven by the question: “What should I get?” It can also be a major purchase, leading to the follow up: “What can I afford?” At the intersection of these two questions sits the auto loan.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |