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Capitalized Cost
The total amount of value for the car upon which a lease is based, similar to the selling price of an automobile you purchase.
Capitalized Cost Reduction
The amount paid in cash or trade-in at the inception of a lease, similar to a down payment.
Captive Finance Company
A leasing or finance company that is associated with a vehicle manufacturer.
Certificate of Origin
A document that conveys the title of vehicle from the manufacturer to the dealer.
Certificate of Title
A legal document issued by the state showing the owner’s name and the vehicle’s mileage at the time of sale.
Closed-End Lease
A lease in which the lessee is not responsible for any difference between the actual and estimated residual value at the time of lease maturity. The lessee’s only extra obligations under a closed-end lease might be mileage or wear and tear exceeding the lease contract provisions.
Cloud On Title
A claim that negatively affects an outstanding title.
Co-Buyer
A Co-Buyer’s (Spouse) income is counted toward the buyer’s income.
Collateral
Property or possessions used to support a loan that in default of your loan payment can be seized.
Collision Insurance
In the event of damage to your car this insurance pays for repairs.
Commitment
A legal binding agreement between a lender and a borrower.
Compound Interest
Interest paid on the principal and it’s accrued interest.
Comprehensive Insurance
This insurance covers damages from theft, vandalism or other natural causes (weather).
Co-Signer
This person assumes equal responsibility for the loan if the borrower does not pay.
Credit
Reputation for solvency and integrity entitling a person to be trusted in buying or borrowing.
Creditor
A lender who is owed money.
Creditworthiness
The ability to repay loans or debts in the past or future.
Credit Bureau
A firm that provides credit and personal information to creditors.
Credit History
A document that shows borrowing and repayment of debts.
Credit Profile
The report showing your history of money borrowed and other financial obligations.
Credit Report
A credit document that shows credit or loan account, balances, employment and financial transactions.
Credit Scoring
Banks and lending institutions use different scoring systems to decide your creditworthiness.
Dealer
An individual licensed by the state to conduct the sale and purchase of new or used vehicles.
Dealer Charges
These charges are for options offered by the dealer.
Dealer Incentives
Auto manufacturers offer programs to dealers to increase sales.
Dealer Invoice
The purchase price of the vehicle that the dealer is required to pay the manufacturer.
Dealer Sticker Price
Sticker price or MSRP is the total price of the vehicle.
Debt Ratio
Your earnings compared to how much you owe.
Deed
A document sealed as an instrument of bond, contract, or conveyance, especially relating to property.
Default
Failure to meet the repayment or other terms of your loan.
Delinquency
Failure to make payments by the date the payment is due.
Depreciation
The value lost as the vehicle ages. During the early years of the vehicle’s life depreciation is usually rapid and can be greater or less than the average because of mileage and wear and tear.
Destination Charge
Shipping charges of the car that is passed on to the buyer.
Disclosure Statement
The total amount of the loan; the loan amount, interest and other financial charges.
Down Payment
The difference between the loan amount and the purchase price; usually paid immediately upon purchase in the form of cash or trade-in value.
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