Auto Financing Terms You Should Know 

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Drivers often ask us about the jargon that’s normally involved with financing, especially if they’ve never financed or leased a vehicle before. These terms all come into play when buying a new car or calculating your Jeep® payment, so it’s important to familiarize yourself with them before you begin the financing process. To help you out, the team at Best Chrysler Dodge Jeep RAM has put together a list of some of the most common terms.

Monthly Jeep® Payment

A monthly Jeep payment is a set amount that you’ll pay your lender to repay your auto loan. If you lease one of the new Jeep models on our lot, your monthly payment will be a recurring payment you make throughout your lease contract to guarantee your right to operate the car you leased.

Down Payment

Unlike your monthly payments, a down payment is a one-time payment you make when you sign a lease or purchase agreement. The larger your down payment is, the less money you’ll need to borrow, and the lower your monthly payments will be.

Lien

When you finance an automobile, your lender places a lien on the vehicle. That lien represents an ownership stake in your car, and it remains in force until you fulfill your debt obligation.

Term

This is the length of time your loan agreement or lease contract remains in force. In the auto industry, a contract’s term is typically expressed in months as opposed to years.

Negative Equity

Drivers who owe more than the amount that their vehicle is worth have negative equity in their automobile. Motorists in this situation are often said to be upside down or underwater in the context of their car loan.

Gap Insurance

Different from your standard auto insurance, gap insurance is coverage that pays the difference between a vehicle’s depreciated value and the amount owed if the automobile is stolen and still missing or destroyed. Gap insurance is a wise purchase for people who are upside down in their financing arrangement.

Incentives

These are deals offered by car manufacturers to their dealers. Our Jeep dealers typically pass these offers on to area drivers to make buying or leasing a new vehicle more affordable. Look over our Jeep incentives now!

Learn More About Jeep Financing at Our Plymouth, MA Dealership

Do you have a question about a term that’s not on our list? Contact our Plymouth, MA Jeep dealership and we will explain what it means so that you have full clarity on the Jeep financing process.