Auto Financing Facts and Figures

The car buying process can be an intimidating and exhausting experience. When you go to a car dealership, or hear a car advertisement, it's almost like a foreign language. To help level the playing field, we've put together this glossary of terms commonly used in the new car arena.

Invoice Price: The manufacturer's charge to the dealer, including freight and advertising.
Base Price: The cost of the car without options, includes standard equipment and factory warranty.
MSRP: Manufacturer's Suggested Retail Price or "Sticker Price"
Rebate: Money the consumer gets from the manufacturer for the purchase of a particular vehicle.
Incentive: Money the dealer gets from the manufacturer for the sale of a particular vehicle.
Make: The brand name/manufacturer of a car or truck, i.e. Ford, Toyota, Chevrolet.
Model: Type of vehicle offered through a manufacturer, i.e. Honda Civic.
Freight or Destination Charge: The cost of transporting the vehicle from the final point of assembly to the dealership. It is a chargeable item on the invoice, and is included in the MSRP or sticker price.
Advertising Fee: Breakdown and itemization of the cost for national advertising for one unit, it is an item on the invoice, and is included in the MSRP or sticker price.
Equipment Package: Popular equipment married into a package, for ease of assembly and consumer savings.
Standard Equipment: Equipment which comes on a vehicle, at no additional charge to the consumer.
Aftermarket Options: Additional equipment that a consumer may choose to have on their new vehicle that was not available from or installed by, the factory, i.e. security system.