What is a Well-Qualified Buyer?
When you start on your car-buying journey, one step along the way will be deciding between leasing the vehicle or financing it. No matter which purchase option you choose, you will be faced with many phrases or terms that you may be unfamiliar with, such as “equity”, “well-qualified buyer”, “principal”, and more. All of these unfamiliar phrases can become confusing, which is why we at Friendly Kia have put together this guide to common automotive lease and finance terms. Continue reading to give yourself a head start when it comes to leasing or financing your next Kia.
>>> READ MORE: Do I Need to Have a Down Payment? <<<
10 Car Leasing and Financing Terms You Should Know
- Annual Percentage Rate – The amount of interest paid each year on a loan balance.
- Cosigner – An additional signer on the auto loan who shares equal responsibility with the individual receiving the loan.
- Default – Failing to make payments based on loan agreement terms and breaking the credit agreement.
- Equity – The monetary difference between what you owe on a vehicle loan and the vehicle’s value. If the car is worth more than what you owe then you have positive equity.
- Grace Period – A period of time after a payment’s due date that a borrower can be late without any penalty fees being charged.
- Lessee – A person who has signed a lease and has temporary use of a car from a leasing company.
- Principal – The amount of money loaned before interest.
- Refinancing – Financing your current car loan with a new lender in order to lower the interest rate, monthly payment, or change the terms.
- Term – The length of time that a borrower makes payments on a loan.
- Well-Qualified Buyer – An individual who is deemed eligible to purchase or lease a vehicle based on the lender’s expectations.
>>> READ MORE: 5 Tips to Lowering Your Car Insurance Payment <<<
Buy or Lease a New Kia in New Port Richey
The finance team here at Friendly Kia loves to help new car buyers find their perfect vehicle. We hope this guide to common automotive lease and finance terms helps you better understand and prepare for purchasing your next vehicle. Start your search for a new Kia in New Port Richey by visiting the Friendly Kia inventory today. Contact a member of our team with any questions!