Glossary / Terms

List of commonly used words & terms

Every industry has commonly used terminology & lingo, but this is especially true in the car finance industry. Here is a glossary of the terms we commonly use that will hopefully make some of the content contained in this site a bit easier to understand.

2nd Chance Loan

See Bad Credit Car Loan >

Assets

Any object which is tangible or intangible which can be owned and can be converted into a monetary value. Examples are: Houses, Businesses, Cars. Also note sums of money are considered to be an asset.

Bad Credit Car Loan

Bad Credit Car Loan is a loan for individuals who have a poor credit history. Having bad credit does not necessarily mean you're excluded from being approved for an auto loan, in fact we specialise in bad credit car loans. Apply for a loan now >

Balloon Payments

A balloon repayment scheme can make your monthly payments lower on an auto loan, but a large payout figure must be made at the end of the car loan.

Cosigner

An additional party who shares equal resposibility for a loan.

Default

Breach of a credit agreement, usually due to failure to meet repayment requirements of said credit agreement.

Equity

If your vehicle is valued at more than the amount owing on your loan, you are said to have positive equity on your car.

Net Income

A borrower's total income minus tax payable.

Overhead

The term overhead refers to the sum of an individual or group's expenses. i.e. The combined costs of rent, electricity, telephone and car maintenance.

Principal

The amount owing on a vehicle loan minus the interest.

Poor Credit

Sometimes refered to as bad credit. Poor credit is usually a result of bankruptcy, repossesions or missing payments. Poor credit does not necessarily mean you will be rejected for an auto loan. Try applying for a loan. Apply for a loan now >

Secured Loan

A secured loan is a loan in which the borrower uses an owned asset (e.g. a car or property) as collateral for the loan. If for any reason the borrower is unable to repay the loan, the creditor will take ownership of the asset used as collateral and may sell it to regain some or the entire amount owed to the lender.

Term Of Loan

The length of time from the beginning of a loan contract to the end.

Unsecured Loan

An unsecured loan, also known as a Personal Loan is a loan in which the loan is based upon a borrower’s credit rating and history as opposed to assets (See secured loan)

VIN (Vehicle Identification Number)

A number given to all cars so that the can be uniquely identified. A VIN is recorded at the time of registration as a means for tracking the ownership, accident statistics, and any illegal activity that may be associated with the vehicle.