Terms to Know When Buying or Leasing a Vehicle:

September 11th, 2020 by

Especially if this is your first time purchasing a vehicle, there can be a lot of new terms. As a quick guide, here are 9 terms to know when buying or leasing a vehicle: 

General Terms to know when buying or leasing a vehicle: 

New – This means the vehicle is a brand new Toyota, with the eligibility of all warranties offered at the dealership. There wasn’t a previous owner, so when you drive it off the lot, you are the first person to own the vehicle. 

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One of the biggest benefits of a new vehicle is the scheduled manufacturer updates and maintenance that comes at no extra cost to you

Pre-Owned/ Used – A vehicle that has been pre-owned has been used and loved by a previous owner, and then sold to the dealership. The age, mileage, and condition of these vehicles can vary, but all pre-owned vehicles are thoroughly inspected so we know exactly what we are offering, and you know exactly what you are purchasing. 

Certified Pre-Owned – These vehicles can be the best of both worlds, opening up some warranties associated with purchasing a new vehicle, with a price tag closer to that of a pre-owned vehicle. When we say the vehicle is certified, that means it has passed a set of standards set by the manufacturer and is then eligible for many of the manufacturer’s warranties. For more specifics on certified pre-owned vehicles, visit this article, here. 

Trade-in or Trade – Though a trade generally means selling your previous vehicle to put the value towards your new vehicle, you can also trade in a vehicle without purchasing a new car. In this case, the dealership is simply purchasing your vehicle from you, to then resell on the lot. For tips on preparing your vehicle for trade, explore this article, here. Or you can value your trade online.

Financial Terms to know when buying or leasing a vehicle: 

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You can get a good idea on whether you would be approved for a loan, by going online, before you even come to the dealership

Pre-approval or Pre-approved – Getting pre-approved means you already have seen if you will most likely qualify for a loan before going to purchase a vehicle. You can get pre-qualified on our website, without the use of a hard credit pull. This is a great resource to see how much you could qualify for, and usually a very accurate indicator of whether you will be approved or not for the final loan. Know that the ultimate loan approval isn’t guaranteed, however, until the final credit check is run after you decide to purchase your vehicle.  

Leasing Leasing gives you access to a new car, with a monthly payment that is usually lower than it would be with financing the same vehicle. The length of the lease agreement and the mileage used are factored into the cost. At the end of the lease term, the vehicle is returned to the dealership. This is a great option for those who prefer to have access to a brand new vehicle, at a lower monthly cost, without needing to purchase or resell the vehicle. 

Financing – Most people don’t pay for their vehicle in full but opt for monthly payments that build equity over time until they own it completely. Financing is simply purchasing the vehicle, with the use of a loan. 

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Equity in your current vehicle can be rolled into your new vehicle when you trade-in

Equity – Equity means the total you have paid toward the vehicle, and in turn, the amount you own. This means the more of the loan you pay off, the more equity you have. Equity is a very positive thing when selling or trading in your vehicle, because the more equity you have, the more money can go towards your new vehicle, and the less you will owe.  

%APR – This stands for the annual percentage rate, and is the annual rate of interest charged for borrowing. The lower the number, the better. 

We are here to help in any way we can. Whether that is help with finding or purchasing your next vehicle, visiting our service team, or answering any questions you may have. Don’t hesitate to give us a call, or come visit us at the dealership. We’d love to see you!