Beat the used car buzzwords

APR

This stands for Annual Percentage Rate of charge, which takes into account not just the interest on the loan but also other charges you have to pay.

Balloon Payment

Some car finance deals include a final 'balloon' payment at the end of the agreement. It's the amount payable after your monthly payments in order to own your vehicle outright.

Diesel Particulate Filter (DPF)

A device fitted to diesel cars as standard in order to minimise the amount of exhaust emissions they produce.

Depreciation

This refers to the natural loss of value of a car over time, from its original market value.

Equity & Negative Equity

You are said to have equity if you owe less on your existing vehicle finance deal than the vehicle is currently worth. Negative equity is the opposite - when you owe more than your car's market value.

Ex-demo Car

These cars aren't new - they will have been displayed in showrooms and test-driven by potential customers. They usually only have a few thousand miles on the clock.

Gap Insurance

This is Guaranteed Asset Protection insurance. If your car is stolen or written off, it's designed to cover any shortfall between the settlement sum your insurance company offers you and what you still owe on your finance deal.

Hire Purchase (HP)

A type of vehicle finance agreement which is payable through fixed interest rates and monthly payments over a set timeframe, effectively enabling you to 'hire' your car until you've paid it off.

Hybrid Car

A hybrid car runs on more than one type of power, such as a combination of petrol or diesel combustion and an electric motor.

MPV

This is a Multi-Purpose Vehicle, also known as a People Carrier or a Mini Van.

Personal Contract Purchase (PCP)

Another type of vehicle finance agreement, PCP deals feature a larger final payment that aims to keep the cost of the monthly payments down.

PHEV

This stands for Plug-in Hybrid Electric Vehicle. These are powered partially by an electric motor that can be plugged in and charged, but also run partly on petrol or diesel.

VIN (Vehicle Identification Number)

Every vehicle is given an ID number when its manufactured. These can be used to check a car's history.

VRM (Vehicle Registration Mark)

Another name for the good old number plate!