Whether you’re interested in a GMC truck, a new Buick Encore, or another vehicle in our inventory, you may want to finance at least part of your purchase. If you do, you may come across some terms you’re not overly familiar with. Buying or leasing an automobile isn’t a daily task for most drivers so it’s only natural that you may not know what every finance term means.
Getting a new or pre-owned car is a big deal so it’s important that you understand what’s being discussed. Here are some terms you may overhear and an explanation of each one:
- Down payment: Whether you lease or buy an automobile, you may have to provide a down payment. Your down payment is the amount you’ll need to pay out-of-pocket. If you want to lower your monthly payment, you can do so by increasing the amount you put down.
- Rebate: Dealerships often entice people to purchase an automobile by offering an incentive or a rebate. Waiving the need for a down payment, offering a low interest rate, and providing cashback are examples of some common rebates.
- Trade-in: A trade-in is a transaction in which you sell your current car to a dealership and use the proceeds to buy or lease a different vehicle.
- Equity: Equity is the difference between your loan balance and the value of your automobile. If your balance is greater than your car’s value, you’re “upside down” with your loan. Motorists who lease rather than buy a vehicle will never build equity in their car.
Are you curious about the meanings of some other finance terms? You can learn what they mean by talking to the pros in our GMC finance center near Sarasota, FL. Can’t make it to our location today? Give us a call or contact Starling Buick GMC online instead.