Also known as LTV, this ratio expresses the percentage of difference between a loan amount and a vehicle value.
Glossary of Terms
We know some auto loan terms can be confusing, so we've put together a useful glossary to better help you understand the industry language.
No results found for . Please refine your search.
Mark-up
The difference between the invoice price and the sales price set by the dealer.
Monroney Sticker
The price sticker required by federal law for all new vehicles. The Monroney Sticker lists all the vehicle’s options along with the manufacturer’s suggested retail price (MSRP).
MSRP
Manufacturer’s Suggested Retail Price. This price is the recommended selling price from the manufacturer and may change when options are added or removed from a vehicle.
Negative Equity
You may have heard the terms being “under water” or “upside down” or having “negative equity” when it comes to an auto loan. These three terms are often used interchangeably to mean the same thing – owing more on a vehicle than it is worth.
For example, say you are looking to trade in your current vehicle for a newer model. You still owe $15,000 to payoff the loan on that vehicle, but the vehicle is only worth $12,000. This means you’re $3,000 in negative equity.
Net Income
A borrower’s total income minus federal and state taxes.