Cash Back or Low Interest Calculator
Compare dealer incentives: cash back rebate with regular financing vs. low/zero interest rate without rebate. See which option saves you the most money.
Total purchase price of the vehicle
Upfront payment (typically 10-20%)
Cash back incentive offered
Interest rate if you take the cash back
Special low interest rate (without cash back)
Length of the loan (common: 48, 60, 72 months)
When should I choose cash back over low interest financing?
Choose cash back if: 1) You have cash available and low-interest investment opportunities, 2) The dealer financing rate is very low (0-2%), 3) You can invest the cash back amount at a higher rate than the loan interest. Choose low interest if: You need to finance and the rate difference is significant (e.g., 1.9% vs 6.5%), or you prefer lower monthly payments.
What is the typical cash back vs. low interest offer?
Common offers: $3,000-$5,000 cash back with regular financing (5-7% APR) vs. 0-2.9% APR with no cash back. For a $30,000 car, cash back might save $3,000 upfront, but low interest could save $4,000-$6,000 over a 60-month loan. Always calculate both scenarios for your specific situation.
Can I negotiate for both cash back and low interest?
Rarely. Manufacturers typically offer either/or promotions, not both. However, you can: 1) Negotiate the vehicle price first, 2) Then choose the best financing option, 3) Shop outside financing from banks/credit unions which might beat dealer rates even without cash back. Sometimes third-party financing + negotiated price beats manufacturer offers.
How does down payment affect the cash back vs. low interest decision?
Larger down payments favor cash back because you're financing less, so lower interest rates save less. With 50% down, cash back is often better. With 10-20% down on longer terms (60-72 months), low interest usually wins. The calculator shows exact savings based on your down payment amount and loan term.