4 Car Loan Terms You Should Never Ignore
Buying a car for the first time always comes along with mixed feelings. On one hand, you cannot wait to drive the car and just enjoy it. On the other, you are not sure if you will be getting value for your money. It gets more confusing if you plan to finance the car through a loan. Everything always looks good on the surface until one has the auto loan form to fill and sign. You then notice terms you cannot understand. Some choose to ignore hard to understand terms and sign the loan forms. It then dawns on them later that they made a mistake. Seek clarification where you have to. Then while at it, always be on the lookout for the following terms.
It is arguably the most common term as far as auto loans are concerned. It simply refers to payments that can make your monthly installments lower at first. In the end though, you may have to a large payment to offset the loan once and for all. So you start off small, but end up big, just like a balloon as it gradually gets inflated.
Bill of sale
Anytime you see the term bill, just think of a separate document. It is not different here. A bill of sale is simply a document that is prepared by a dealer. Its purpose is to record the details of every car sale they make.
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The term should not scare you. It refers to a book that has a collection of details or any other information about the value of a car. The book bases the value on average prices from car auctions. It does not have to be necessarily black in color.
Be careful with this. It refers to an additional party who consents to assume equal responsibility for a car loan. It could be a friend, a colleague or even a spouse. The party consents that in the event of a default, he or she will take liability.