Glossary of Auto Loan Related Terms

Late Payment

A payment made later than agreed upon in a credit contract and on which additional charges may be imposed.

Lease

A form of financing in which you can use a vehicle for a period of time in exchange for making payments to the leasing company. In a lease, the leasing company continues to own the vehicle.

Lessee

A person who signs a lease to get temporary use of property.

Lessor

A company that provides temporary use of property usually in return for periodic payment.

Liability on an Account

Legal responsibility to repay debt.

Lien

A claim upon a piece of property for the payment or satisfaction of a debt or obligation.

List Price

The manufacturer's suggested retail price for a vehicle. Also called "MSRP" or "Sticker Price."

Loan-To-Value Ratio

The relationship between the amount of the mortgage loan and the appraised value of the property expressed as a percentage.

Lock Term

A lender's guarantee of an interest rate for a set period of time. The time period is usually that between loan application approval and loan closing. The lock-in protects you against rate increases during that time.