Glossary

Auto Loan

A secured installment loan used to purchase a vehicle, with the car serving as collateral.

An auto loan is paid back in fixed monthly installments over 24-84 months. Because the loan is secured by the vehicle, rates are typically lower than unsecured personal loans. If you default, the lender can repossess the car.

Related terms

APR (Annual Percentage Rate)

The yearly cost of a loan including interest and fees, expressed as a percentage.

Refinance

Replacing your current auto loan with a new loan at better terms.

LTV (Loan-to-Value Ratio)

The loan amount divided by the vehicle's value, expressed as a percentage.

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