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A

The term over which you agree to repay the finance, often expressed as 12, 24 or 36 months, where you are required to make repayments monthly.

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APR stands for the Annual Percentage Rate of charge. You can use it to compare different loan products. The APR takes into account not just the interest on the loan but also other charges you have to pay: for example, any arrangement fee.

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Any money owed by you to the lender that’s overdue. If you are in arrears you should contact us and let us work with you.

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B

Much as we might not like it, sometimes cars break down or won’t start. Breakdown cover provides assistance should you breakdown away from home or at your home address, subject to the cover provided, in most instances it offers recovery to your home or a garage you request. Different products offer different levels of cover, you should select the cover appropriate to your needs.

At Approved Car Credit we take steps to protect you from this with our 5* warranty cover which includes 6 months’ free breakdown as standard, including home start and recovery to a local garage of your choice. Speak to our sales team to extend your level of cover.

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C

Consumer Credit Directive. This is an EU directive designed to improve the disclosure of information to consumers.

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The Consumer Credit Act provides a statutory cooling off period of 14 days, should you wish to withdraw from a credit agreement during the cooling off period you should contact the lender before the expiry of the 14 days. If you have bought goods on credit and decide to withdraw from the agreement you may still be responsible for the purchase price of the goods.

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A credit agreement is a formal document that contains the terms upon which a lender has agreed to lend to you and sets out your obligations to repay the loan. If you are a consumer that agreement will be in a form prescribed by the Consumer Credit Act.

You will some sometimes hear companies refer to the credit agreement as a finance agreement.

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Your credit history is a record of your borrowing behaviour and is based on information supplied to credit reference agencies, this may include finance agreements, bank account or utilities and is something a lender will consider when making a decision to lend.

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Credit rating (also known as a ‘credit score’) is an indication of how credit reference agencies rate your credit behaviour, your credit score is made up of different factors such as your payment history or level of credit. Different credit reference agencies may score you differently.

At Approved Car Credit we do not use your credit score as we understand that your score may not reflect your current circumstances or your ability to repay finance. We manually assess each application to ensure the product you take is affordable to you.

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A credit search is a search undertaken to identify your credit history, it is undertaken by most lenders to establish your credit history. Too many searches over a short period can affect your ability to obtain credit and your credit score. A search will remain on your credit history for one year. If you obtain credit the lender will appear on your credit report.

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Or just deposit, is the initial payment you put down towards the car at the start of the finance agreement. The larger your deposit, the lower your monthly payments. Your deposit will be shown on the credit agreement.

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D

Depreciation is the amount of value a vehicle loses over time. You should be aware that if you pay for a vehicle with a finance agreement over a number of years, it will be worth less at the end of the agreement than the amount the vehicle was sold for.

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This is a fee usually charged at the start of the finance agreement. It's paid to lenders to cover their administrative cost, such as issuing relevant documentation and setting up the finance. It's also known as an acceptance fee or an administration fee and is included by lenders when calculating the APR.

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E

This is when you decide to end the finance agreement before its contractual expiry date. If you repay your finance early, depending on when you repay, you may be entitled to a rebate on the total amount that you are scheduled to pay.

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F

FCA is the acronym for the Financial Conduct Authority who regulate financial markets in the UK, they approve lenders and brokers. The Asset Exchange Ltd trading as Approved Car Credit are fully authorised and regulated by the FCA, our FCA reference number is 729827.

If a lender or broker is not on the FCA register they are not authorised and a consumer may not be protected.

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This is a set rate of interest which will apply to the credit agreement throughout the term of the agreement and will not change. It is the annual rate applied to your account and should not been confused with APR.

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G

Guaranteed asset protection – a type of insurance which covers the difference between the original cost of the car and its value should the vehicle be written-off or stolen. Most GAP products cover the difference where traditional motor insurance pays less than the purchase price of the vehicle.

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H

This is sometimes shortened to HP. This finance deal normally involves putting down a deposit and then is repaid with fixed monthly instalments. You don’t own the car until the debt is fully repaid, and you pay the option to purchase fee at the end of the agreement, once you have paid the final instalment and the option to purchase fee you own the vehicle.

Hire Purchase agreements are a type of credit agreement.

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J

It’s possible to apply and sign a finance agreement with two or more people. Together, they are responsible for repaying the loan or finance agreement.

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P

Trading in your old car and using it as a contribution towards a new one.

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Q

Also known as a soft search. It’s a type of credit search which doesn’t leave a trace on your credit file. It’s used to give finance companies an indication of risk and to decide how much they can offer you.

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S

See Quotation above.

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T

This is used to describe the length of time you’ll be paying off the finance agreement e.g 18 months.

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This is the total amount, including the loan, total cost of credit, interest and fees, which you’ll repay the lender over the term of the agreement.

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W

Cover for your vehicle to give you peace of mind. Approved Car Credit provide 6 month warranties on all vehicles sold, and you can choose to extend the warranty for an extra cost if you wish. Although our warranties are 5* cover some items are not covered, and you should read your warranty carefully. Our warranties come with recovery to a local garage and home start as standard. It may be that a warranty from a different service provider is more suitable for you. If you decide it is, you might want to purchase it independently.

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