Loan terminology for understanding
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||Your credit history is:
||Mortgage/Refinance mainly for
use by people with:
||Excellent - None
||poor or no credit history, other credit welcome.
||Excellent - Poor
||poor credit history, other credit welcome.
||Excellent - Average
||average to excellent credit history.
||Excellent - Good
||good to excellent credit history.
||excellent credit history.
||Full credit range
||Loans tailored to credit history.
- An evaluation of what a particular property in question is worth at a
specific time or date.
- Acronym for Annual Percentage Rate. A yearly rate of
interest on a loan.
- Balloon Note
- An amount left over after the term of the loan is past. The amount
still owed on the property boughta lump sum of money owed at the end of a loan.
- A legal ruling where a person is said to be so far in debt that they
cannot possibly cover their own existing loans nor can they earn enough to keep up with
the payments. Whatever property that has a lien on it is then taken by the creditors
(repossession or foreclosure) and usually sold to help recover the loss of what would have
normally been paid by the person taking on the debt.
- Base Price
- The cost of a car with only the standard equipment, factory warranty,
and destination charge.
- Your history of handling financial obligations and banking accounts.
- A document that names you as the legal holder of the property in
- The value of your property minus the debt owed for it.
- Bank or lender takes possession of your property used as collateral
due to non-payment of a previously secured loan.
- Gross Income
- The total amount that you earn at your place of employment. If
self-employed, the amount left over after your expenses are subtracted from total brought
in via your business.
- Home Equity Line
- The amount determined by the lending institution that can be borrowed
against your current home minus the balance owed for the home.
- Home Equity Loan
- A loan taken out that is usually in the amount equal to or less than
the amount of the home's worth minus the first mortgage amount still owed on the house.
The lender then becomes temporary part owner of the home until the equity loan is paid
off. Equity loans are tax deductible which is favorable and recommended over a regular
loan taken out directly for some purchase such as a car or other type of major debt.
- Interest Rate
- The percentage of a sum of money charged for its use.
- The act by which a creditor obtains the rights to hold onto or sell
property owned by the person in the event that the person lending money defaults on
his/her loan payment agreements.
- Lock (locked) or Lock In
- A guaranteed period of time where the APR of a loan is kept at the
rate promised by the bank or lender until the loan is secured by the person taking the
- Manufacturer's Rebate
- Money offered towards the cost of a car that comes from the auto
manufacturer. An incentive used to move slow selling cars or cars that are to be soon
replaced by next year's model.
- Monroney Sticker Price
- A federal law requirement that the price that applies to the specified
car be labeled as having a described cost and applied to the car window. It shows the base
price, the manufacturer's installed options, fuel efficiency, the manufacturer's suggested
retail price (MSRP), destination charge (the cost to ship from the manufacturer's location
- The act of trading the home to the lending institution to secure a
home loan. Once the loan is completely paid back, the lender is to release the home back
to the person taking out the loan. Usually this is accomplished with the lender returning
the deed to the house.
- The person taking the mortgage and making payments with interest.
- Legal lender that finances property.
- To finance again under a new agreement which is usually for a lower
interest charge (or APR).
- Indicates the period of time that it will take to pay off the loan and
is usually expressed in months or years of time. Car loans generally fall into 24, 36, 48,
and 60 month periods.
- A legal document that states that you have the right of ownership of a
- Trade-in Value
- The amount a dealership evaluates as to your car's worth. That amount
is then subtracted from the total cost of the replacement car or truck and covers partial
or full payment for that vehicle.
- Processing the paperwork and verifying your credit history for the
purpose of approving your loan.
- Upfront Costs
- Fees collected when a loan is processed and generally approved.
Sometimes the fees reduce the amount of interest paid such as when you pay points on a
- When the value of a vehicle is lower than the outstanding balance of
the loan secured by the vehicle.
- To give up a claim or right voluntarily.
- The act of signing a legal document to release an entity from legal
obligations or charges.