Dealers typically offer a cash rebate or a promotional low-interest rate, not both — so the real comparison is which one leaves you paying less overall, not which one sounds more appealing on its own.
How it works
Both paths are financed to a total cost figure: the rebate path finances a smaller amount (after the rebate) at the standard rate, while the low-interest path finances the full price at the promotional rate. Whichever produces the lower total — down payment plus every payment made — is the cheaper option for that specific loan term.
Why a bigger rebate isn’t automatically the better deal
A large rate gap can outweigh a modest rebate over a long loan term, since interest compounds over every remaining payment while the rebate is a one-time reduction. Shorter terms tend to favor the rebate more, since there’s less time for a rate difference to compound.
How to use this calculator
- Enter the car price, down payment, and the cash back offer.
- Enter both the standard rate (with cash back) and the promotional rate (without it).
Frequently asked questions
Why would I ever take the lower cash-back offer?
If the standard rate is high enough, the interest saved by the promotional rate can exceed the rebate — this calculator shows exactly when that crossover happens for the numbers entered.
Does the loan term change which option wins?
Often, yes — a longer term gives a rate advantage more time to compound, which can flip which option is cheaper compared to a shorter term.
Can I negotiate the price down and still get either incentive?
Sometimes, but dealers frequently link incentives to the listed price — always confirm which incentives remain available after any price negotiation.
