Auto Loans

Front

What does interest rate refer to in auto loans?

Back

The percentage of the loan amount that the lender charges as interest

Front

What is the loan term in auto loans?

Back

The loan term refers to the length of time over which the loan is repaid.

Front

What is a down payment in auto loans?

Back

The initial payment made by the borrower towards the purchase of a vehicle.

Front

What is amortization in auto loans?

Back

The process of paying off a loan with regular, fixed payments over a set period of time.

Front

What does loan-to-value ratio refer to in auto loans?

Back

The ratio of the loan amount to the value of the car being financed.

Front

What is the typical loan term for auto loans?

Back

36 to 72 months

Front

What is the recommended down payment for auto loans?

Back

At least 20% of the car's purchase price

Front

How is the loan amount gradually paid off in auto loans?

Back

Through monthly installments that include both principal and interest payments.

Front

What loan-to-value ratio is generally preferred by lenders?

Back

80%

Front

What is the principal in terms of auto loans?

Back

The total amount of money borrowed by the borrower.