Understanding Common Auto Finance Terms

Understanding some of the most common terms used in auto financing will help you find the best deal on your next car purchase. We at BMW of Honolulu want you to make an informed decision about your next vehicle purchase, so here are a few common terms used in auto finance.

Term/Maturity- The date when you will have paid your loan in full, also known as the maturity date.

Amortization- The amount of your monthly payment that is applied to interest and the principal amount of your loan. Over time, more of your payment will go toward paying off the principal balance of your auto loan than it will go toward to pay off the interest.

Annual Percentage Rate (APR) - This is the rate of interest you will pay when you add in what it costs to obtain a car loan. The APR is always higher than the quoted interest rate.

If you need to finance your next vehicle, come see us today at BMW of Honolulu.

 

 

Categories: Finance