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Your Location: Home - Auto Loan Auto Loan Information CenterCar and Auto Terminology Dictionary
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Acceleration Clause
A stipulation in hire-purchase agreements that upon default in payment of any one installment, the full outstanding balance of the price shall immediately become due. The acceleration clause confers upon the owner the right, while keeping the agreement alive, to recover from the defaulting hirer the full unpaid balance of the hire-purchase price.
Amortization
This term is used in two senses:
(1) The repayment of Principal and Interest components of a Loan, over a period of time.
(2) Write-off of an expenditure (like issue cost of shares, pre-incorporation expenses) over a period of time.
Balloon lease
In this type of lease agreement the rentals are low at the inception, higher during the middle period and again low during the end.
The residual value in such lease contracts are usually very low.
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