Common Finance Terms
Buying a new car is a big decision and a financial responsibility. Here at Honda on Grand, we want to make sure that you get the car you want and the deal you want without any confusion. To fully understand all that comes into financing a car, you’ll need to know these common terms first:
- Annual Percentage Rate (APR) – Also called a finance rate, this is the yearly interest rate on a loan when you borrow money.
- Auto Loan Term - The amount of time you have to pay off your car loan. Long-term loans give you more time, but have higher interest. Short-term loans give you less time to pay it off, but with lower interest.
- Down Payment – This is the cash paid up-front for the car.
- MSRP – This stands for “Manufacturer’s Suggested Retail Price” and refers to the base price of a vehicle before dealerships price it or before you have any add-ons to the car.
- Principal – The amount borrowed.
- Trade-in Value – The price a dealer pays you for your current car when they are selling you a new one.
- Up-Front Costs – The total of all costs (including fees and taxes) when signing the contract on a new car.
Now that you feel caught up with these terms, you’ll feel confident in getting that new Honda you’ve had your eye on. If you have any other questions about finance terms or our finance department feel free to contact us by filling out a form or call us at 630-833-7700.
Our dealership proudly serves the Greater Chicago area and we are conveniently located in Elmhurst, IL. For all of your Honda need, stop by our dealership and we will do our very best to have you leaving our dealership more happy than when you entered!