Glossary of Auto Loan Terms
(P)
Preferred Placement Form
The preferred placement form is commonly used on Web sites as a way
of bringing lenders and borrowers together. Additional information
may be required in order to access this option.
Preparation charges
The cost assessed by a dealer to get the car ready to sell. These
may include removal of coverings and filling the tank. The
preparation charges may be a positive negotiation point for the
buyer since those costs to the dealer are fairly minimal.
Principal
The principal is one of two parts of a loan with the other being the
interest. The principal is simply that amount of money borrowed for
the purchase.
Principal Balance
The principal balance is that amount remaining on a loan at a
particular moment in time. Note that the principal balance will
change daily because of the interest that is added to the principal.
Promise to Pay
The promise to pay refers to the borrower’s agreement to make
payments at a specific time. |
