Dealership Terms Explained
Sometimes We Speak Our Own Language
Below is a list of common automotive dealership terms you may hear when buying your new or pre-owned vehicle.
Documentation fees are designed to pay for the costs incurred by the car dealer in association with processing paperwork, and attaining CarProofs and lien releases related to a lease or purchase.
An extended warranty gives a consumer additional warranty protection after a vehicle’s original factory warranty expires. Car dealers typically explain the value of extended warranty at the time a new vehicle is purchased to guarantee the customer is always protected, but consumers can take advantage of an extended warranty at any time.
This abbreviation stands for finance and insurance. When buying a new vehicle, consumers are sent to the F&I office to finalize the details of the deal while the dealership prepares the new vehicle for customer delivery. In the F&I office, additional products and services may be offered to the consumer, such as dealer financing, extended warranties, service contracts, insurance, and more. At the end of this process, the purchase contract is finalized and signed, and then the customer drives home in his or her new vehicle.
The interest rate is the amount of interest a consumer pays on a new vehicle loan, expressed as an Annual Percentage Rate (APR). The lower the APR, the better the interest rate.
The Manufacturer’s Suggested Retail Price (MSRP) is also referred to as the sticker price.
Buy Direct Price
In an effort to simplify and bring transparency to the process of buying a used vehicle, Kelowna Hyundia purchases 40 to 50 pre-owned vehicles at one time so we can take advantage of bulk pricing. Our buying power allows us to pass along these savings to consumers; sometimes saving customers thousands less than a brand new vehicle. Our prices are designed to give customers discounts so buying a car, truck, or SUV is easier, faster, and less stressful.
Trade-in value is the amount of money a car dealer is willing to pay a consumer for the consumer’s old car. This amount of money is typically less than what a consumer can obtain for the old car by selling it herself or himself via private party. The reason the trade-in value is lower is because the car dealer is taking on any financial risk associated with the old car, including the costs associated with reconditioning the vehicle and preparing it for sale, or transporting the old car to an auction if the car dealer determines it is not right for the dealer’s used car lot.
When a consumer is “upside down” on a car loan, he or she owes more money on the vehicle than the vehicle is worth. To avoid becoming upside down on a car loan, consumers should make a larger down payment and choose a model that holds more of its original value over time.
The protection package offered at Kelowna Hyundai includes: rust, paint, interior and undercoating protection. These products are meant to safeguard vehicles to guarantee they look their best for much longer, and hold the value on your vehicle until resale.
A bi-weekly payment schedule reduces the outstanding balance of your auto loan every two weeks (instead of the standard monthly payment schedule). This method of loan repayment helps you pay twice as often against the principle balance of the loan.
The term Subprime refers to the credit quality of particular borrowers, who have a weakened credit history. As people become financially active, records of borrowing, earning and lending history is calculated to create a credit rating per every individual. Clients with lower than average credit score would be considered Subprime borrowers.
This abbreviation stands for Pre-Delivery Inspection. During a pre-delivery inspection, the vehicle is checked by a qualified Technician to ensure all components are operating safely and effectively.
90% Market Value
This term is part of our Guaranteed Best Price Policy. By stating all vehicles are marked at 90% of market value, we are saying that all our vehicles are at least 10% less than any of our competitors. If you can find a competitor who will beat our original price, we promise to beat theirs by 10%.