Final Flashcards
Define: Sales Tax
Amount of tax paid on the price paid for the vehicle at the time of title and registration at the DMV. Tax is calculated on place of residence so tax will be collected for state, county and/or city.
Define: F&I Office (Finance and Insurance)
Where you complete paperwork after purchasing car.
Define: APR
Annual percentage rate; the annual rate of interest that is charged for using credit
Define: As is
A car sold with no warranty. All repairs from the moment the vehicle is purchased are at the car buyers expense.
Trade-In Value
The average price the dealership will give you for your old car when you buy a new car through them.
Extended Warranty (Service Contract)
An additional form of protection that can be purchased to extend/enhance a manufacturer’s warranty.
Lemon Laws
Laws that protect consumers from the consequences of buying a defective car with serious issues.
Window Sticker
Required by law to be placed on every new vehicle that lists MSRP, options, fuel economy, etc. Also called the Monroney sticker.
Recall
When a safety defect is discovered and the manufacturer is required to fix the problem at no charge to the owner.
Registration
It is legally recording vehicle ownership with the Dept. of Motor Vehicles (DMV) for tax and licensing purposes. The certificate must be carried in the vehicle.
VIN
Vehicle Identification Number, a unique coded used the auto industry to identify and track each vehicle manufactured.
Title
Vehicle’s proof of ownership issued by the state’s DMV. A loaned vehicle’s title will be held by the lender (lien) until the loan is paid off. An owner can get a TOD (transfer of death) title.
Down payment
Cash paid upfront when something is brought on credit to reduce the amount of the loan.
Documentation fee
Charges intended to cover the cost of processing the paperwork involved in the sale of a car. Many fees charged by dealers are negotiable, and this one should be challenged as excessive if its more than $100.
MSRP
Manufacturers Suggested Retail Price - the price the manufacturer is suggesting the vehicle be sold for. AKA: Sticker price, list price, sticker, or retail price
Asking price
The price the seller of the car posts when advertising the car
Base price
Cost of a vehicle with standard equipment before options and upgrades
Dealer Invoice Price (Invoice Price)
Approximate price the dealer pays to buy the car form the manufacturer
Blue Book Value
Estimated market or trade-in value of a used vehicle as calculated by Kelley Blue Book, Edmunds, etc.
Commission
The amount of income the salesperson makes when they sell a vehicle
Destination Charge
The transportation cost to get the vehicle from the manufacturer to dealership and the cost is passed on to the customer. Not included in the MSRP. AKA: Delivery charge.
Options
Extras added to a vehicle beyond that standard equipment (sunroof, leather seats, navigation system, etc.)
Incentives and Rebates
Any offer to car buyers, from the car manufacturer, to get customers to buy the car.
Option packages
A package of extra options that the manufacturers will put together at a reduced price.
