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Major Life Purchases
| Term | Definition |
|---|---|
| Acquisition Fee | a fee you pay when leasing a car or other types of vehicles |
| Closed End Lease | a rental agreement that puts no obligation on the lessee to purchase the leased asset at the end of the agreement |
| Collateral | something pledged as security for repayment of a loan, to be forfeited in the event of a default |
| Dealer Incentives | a financial inducement used by manufacturers to motivate dealers to sell a particular product by offering discounts on that product |
| Default | guilty of failing to repay a loan or appear in a court of law |
| Deficiency | the numerical difference between the amount of tax that a taxpayer, or taxpaying entity, reports on a tax return and the amount that the Internal Revenue Service (IRS) determines is actually owed |
| Depreciation Fees | an amount in accounting that is commonly a fixed percentage of the original cost of a property and that is periodically charged off to expense or against revenue in order to compensate for the depreciation of the property |
| Early Termination | the Termination of Employment before Normal Retirement Age for reasons other than death, Disability, Termination for Cause or following a Change of Control |
| Finance Charge | a fee charged for the use of credit or the extension of existing credit |
| Fixed Rate Loan | the interest rate stays the same for the loan's entire term |
| Inception Fees | the initial set of fees that you would need to pay when you lease a car |
| Installment Loan | a type of loan where you borrow a set amount of money all at one time |
| Invoice Price | the initial price that the manufacturer charges the dealer |
| Lease | a contract by which one party conveys land, property, services, etc. to another for a specified time, usually in return for a periodic payment |
| Lessee | a person who holds the lease of a property; a tenant |
| Lessor | a person who leases or lets a property to another; a landlord |
| Mileage allowance | the deductibility of expenses car owners accrue while operating a personal vehicle for business, medical, charity, or moving purposes |
| Mileage Charge | an amount of money paid for every mile traveled |
| Money Factor | a method for determining the financing charges on a lease with monthly payments |
| MSRP | manufacturer's suggested retail price (MSRP) is the price the producer of a product sets and recommends a retailer charge for the sale of the product |
| Open End Lease | a type of rental agreement that obliges the lessee to make a balloon payment at the end of the lease agreement amounting to the difference between the residual and fair market value of the asset |
| Purchase Option | a right to purchase or lease land or other property interests without any obligation to do so |
| Rebates | a partial refund to someone who has paid too much money for tax, rent, or a utility |
| Residual Value | the estimated value of a fixed asset at the end of its lease term or useful life |
| Secured Loan | loans that are secured by a specific form of collateral, including physical assets such as property and vehicles or liquid assets such as cash |
| Trade-In Value | a car dealership's valuation of your car when you opt for a trade-in |
| Unsecured Loan | a loan that doesn't require any type of collateral. Instead of relying on a borrower's assets as security |
| Upside Down | the situation when you buy something on credit and now owe more for it than it is worth |
| Variable Rate Loan | a loan in which the interest rate charged on the outstanding balance varies as market interest rates change |
| Warranty | a written guarantee, issued to the purchaser of an article by its manufacturer, promising to repair or replace it if necessary within a specified period of time |
Created by:
eschneider22
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