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Some Important Auto Finance Terminologies

When you are looking for a vehicle to buy or lease from a dealer, you should be aware of the following auto financing terminologies:

  • Charge-Off – Happens when the borrower has been late for a long period of time, the creditor considers the loan uncollectible. To recoup their losses, the lender will try to repossess their vehicle at this point.
  • Collateral Protection Insurance – when the consumer does not have an auto insurance, the insurance policy protects the lender from financial losses from having to pay claims
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