Cash Back or Low Interest Calculator
Compare a cash rebate with regular-rate financing against a low-interest promotional loan to see which auto financing offer costs less overall.
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Change any assumption and calculate again to compare results.
Cash Rebate vs Promotional APR
Manufacturers and dealers sometimes offer a choice: take a cash rebate and finance at a normal market rate, or give up the rebate and qualify for a lower promotional APR. The option with the lowest monthly payment is not always the option with the lowest total cost.
This calculator builds both loan scenarios from the same vehicle price, down payment, trade-in, tax, fees and term. It then compares monthly payments, total interest, amount financed and total cash outflow.
How to Compare the Offers
The rebate option reduces the purchase amount before financing but uses the higher APR. The promotional option keeps the full purchase amount but applies the lower APR. The calculator identifies the lower total outflow and shows the dollar advantage.
If your local tax rules treat manufacturer rebates differently, adjust the price or fees so the financed amount matches the dealer worksheet. Always compare the same term and the same down payment.
Example
For a $35,000 vehicle with a $2,500 rebate, 60-month term and 6.5% regular APR, compare the result with a 1.9% promotional APR and no rebate. Depending on the tax and down-payment assumptions, the interest savings from the promotional rate may or may not exceed the lost rebate.
Other Costs to Check
Dealer add-ons, documentation fees, insurance, warranties, early payoff plans and opportunity cost can change the practical choice. This tool focuses on the financing math and purchase-side costs entered in the form.
Frequently Asked Questions
Is a cash rebate always better than a low APR?
No. A rebate reduces the amount financed, while a low APR reduces interest. The better choice depends on vehicle price, rebate size, term, down payment and the two interest rates.
How does the calculator treat the rebate?
The cash-back scenario subtracts the rebate from the purchase amount before financing. The low-APR scenario assumes the rebate is given up in exchange for the promotional rate.
Does this include taxes and fees?
Yes, using the sales-tax percentage and fees you enter. Actual dealer tax treatment of rebates varies by location, so confirm how your jurisdiction taxes incentives.