Frequently asked questions
When is the low interest rate usually the better deal?
Low-rate financing wins when the loan amount is large relative to the rebate and the term is long. On a $30,000+ loan over 60–72 months, even a 2–3% rate difference compounds into thousands, which often exceeds the cash-back amount. Run both through the calculator to compare total cost.
When does cash back make more sense?
Cash back tends to win on shorter loan terms (36 months or less) or when the rate difference between the promotional and standard offers is small (1–2%). A shorter loan limits how much interest accrues, so the upfront principal reduction from the rebate outweighs the rate savings.
Can I use the cash back as part of my down payment?
Yes, most dealers apply the rebate directly to the purchase price, reducing your financed amount. This is the standard treatment and what this calculator assumes. Some buyers also combine it with their own down payment for an even lower loan balance.
Does this account for fees and taxes?
This calculator focuses on the core comparison between the two financing paths. Sales tax and fees are typically the same regardless of which option you choose, so they do not affect which deal is better. If tax is calculated on the pre-rebate price in your jurisdiction, the comparison remains valid.
What if the dealer offers 0% financing?
Zero-percent offers are very powerful on longer terms because you pay no interest at all. Set the low rate to 0% in the calculator. Even a large rebate often cannot overcome paying zero interest over 60+ months, but on a short 24–36 month loan the rebate might still win.
Should I consider my credit score when deciding?
The promotional low rate is typically available only to buyers with excellent credit (720+). If you do not qualify for the advertised rate, the cash-back option at your actual approved rate may be your only realistic path. Check your pre-approved rate before comparing.