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Terminal Pause
This refers to a payment profile such as ‘3 + 33’ or ‘3
+ 21’. Basically, your payments would equate to the number of
months over the period of hire, essentially a 3-month deposit, followed
by either 21 or 33 payments. Because you have paid a 3-month deposit,
you would not need to pay anything for the final two months of the
contract.
Reduced Spread
More commonly used within the industry today as a way of keeping your
monthly payments to be as low as possible. A ‘3 + 35’
or ‘3 + 23’ payment profile are the most common examples,
simply meaning that you pay 3 months deposit, which is then followed
by 23 or 35 monthly payments. This is a way of making 26 or 38 payments
as opposed to 24 or 36; however, your payments are reduced because
of it.
Document or Application Fee
This is normally a £90.00 + VAT charge which covers the costs
for obtaining a credit acceptance from one of our financial providers,
and arranging documents. This is not charged if for some reason we
are unable to obtain funding, or you decide not to go ahead with a
deal before you have signed an order.
APR
Annual Percentage Rate - The True rate of interest you are paying
on a finance agreement.
Balloon Payment
This is the final end payment on a finance agreement. This would be
an optional payment on a Personal Contract Purchase (Subject to Terms
& conditions), and compulsory on a product such as ‘Lease
Purchase’
Depreciation
The reduction in value of a vehicle caused by age, mileage and condition.
This is what the majority of lease agreements payments are calculated
on.
GMFV
Guaranteed Minimum Future Value
MRP
Manufacturers Recommended Price Residual Value. The value of the vehicle
at the end of the contract, normally estimated at the beginning of
the contract.
P11D Value
The Value of the vehicle, being the price new together with the cost
of the extras. This is for the Inland Revenue taxation purposes.
PPM
Pence Per Mile, normally referring to any Excess Mileage charges
RFL
Road Fund Licence
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