Silent Bob
Well-Known Member
- Joined
- Nov 20, 2020
- Messages
- 467
- Reaction score
- 504
Rebate vs. lower interest: Which car incentive is right for you?
It is nice when you can do both but often you have to make a choice. Do you want a lower monthly payment or a lower total cost? The below can be of help when making these decisions.
When choosing which offer to take keep in mind that the low interest rate offer that only those with excellent credit qualify for the lowest published rates. Consider the specifics to see whether the lower interest rate or the cash rebate is the better option for you. Variables such as how much money you put down, the total purchase price of the vehicle, any trade-in values, your local sales tax rate and the length of the loan can affect the total you pay. A longer loan term can lower your monthly payment, but you pay more total interest over the life of the loan.
Auto Rebate vs. Low Interest Financing Calculator - LINK
Use this calculator to help you determine whether you should take advantage of low interest financing or a manufacturer rebate. A rebate will reduce your auto loan balance, while low interest financing lowers your monthly payment. The best option depends on the price of the vehicle, the size of the rebate and the interest rates available for financing.
You should always have preapproved finance percentage number or at least a very good idea of what it will be before negotiating with the dealer. The average financing rate for a new car is 5.15% as of this writing. Don't forget to enter in your down payment and/or trade in allowance.
Calculator Definitions
Total purchase price (before tax)
This is the total cost of your auto purchase. Include the cost of the vehicle, any additional options and any destination charges. Don't include sales tax in this amount. Sales tax will be calculated for you and included in your total after-tax price.
Term in months
Number of months for your auto loan.
Cash down
Total amount of cash used in this purchase. The larger your cash down payment the smaller the loan you will need to finance this purchase.
Trade allowance
The total amount that you are given for any automobile that you trade-in as part of this purchase. In some states a trade-in can also reduce the amount of sales tax you will owe. See the definition for 'Sales tax deduction for trade-in' for more information on trade-in vehicles and sales tax.
Amount owed on trade
Total loan balance still outstanding on the trade-in.
Sales tax rate
Sales tax percentage rate charged on this purchase.
Traditional financing
The interest rate you may be able to receive from a bank, credit union or other lender. This is usually a higher interest rate than the manufacturer's low interest financing, but is often very competitive when used in combination with a manufacturer rebate. This calculator assumes that if you choose a manufacturer rebate you are not eligible for manufacturer low interest financing.
Low interest financing
The incentive interest rate you may be able to receive from an auto manufacturer. These rates are usually significantly below standard auto loan interest rates. Low interest financing can be as little as 0% per year. Most manufacturers allow you to choose either low interest financing or a manufacturer rebate, but not both. This calculator assumes that if you choose low interest financing you are not eligible for any manufacturer rebate.
Manufacturer rebate
A cash rebate paid by the auto manufacturer to you when you purchase a new vehicle. Most manufacturers allow you to choose either low interest financing or a manufacturer rebate, but not both.
No sales tax deduction for trade-in
If you live in a state where your sales tax is calculated on your full purchase price check this box. If this box is unchecked sales tax is calculated on the purchase price less trade-in. Currently California, the District of Columbia, Hawaii and Michigan allow no deductions for trade-ins when calculating sales tax. In addition, Alaska, Delaware, Montana, New Hampshire, and Oregon have no sales tax on autos.
Calculate sales tax before rebate
Some states will calculate sales tax on your purchase price before a manufacturer's rebate is applied. If your state calculates sales tax on the vehicle price before the rebate is applied, check this box.
The Best Time to Buy Your Ram
This link has advice on when you are likely to get the best price on your new truck. LINK
Why Invoice is the New MSRP LINK
5thgenrams.com
It is nice when you can do both but often you have to make a choice. Do you want a lower monthly payment or a lower total cost? The below can be of help when making these decisions.
When choosing which offer to take keep in mind that the low interest rate offer that only those with excellent credit qualify for the lowest published rates. Consider the specifics to see whether the lower interest rate or the cash rebate is the better option for you. Variables such as how much money you put down, the total purchase price of the vehicle, any trade-in values, your local sales tax rate and the length of the loan can affect the total you pay. A longer loan term can lower your monthly payment, but you pay more total interest over the life of the loan.
Auto Rebate vs. Low Interest Financing Calculator - LINK
Use this calculator to help you determine whether you should take advantage of low interest financing or a manufacturer rebate. A rebate will reduce your auto loan balance, while low interest financing lowers your monthly payment. The best option depends on the price of the vehicle, the size of the rebate and the interest rates available for financing.
You should always have preapproved finance percentage number or at least a very good idea of what it will be before negotiating with the dealer. The average financing rate for a new car is 5.15% as of this writing. Don't forget to enter in your down payment and/or trade in allowance.
Calculator Definitions
Total purchase price (before tax)
This is the total cost of your auto purchase. Include the cost of the vehicle, any additional options and any destination charges. Don't include sales tax in this amount. Sales tax will be calculated for you and included in your total after-tax price.
Term in months
Number of months for your auto loan.
Cash down
Total amount of cash used in this purchase. The larger your cash down payment the smaller the loan you will need to finance this purchase.
Trade allowance
The total amount that you are given for any automobile that you trade-in as part of this purchase. In some states a trade-in can also reduce the amount of sales tax you will owe. See the definition for 'Sales tax deduction for trade-in' for more information on trade-in vehicles and sales tax.
Amount owed on trade
Total loan balance still outstanding on the trade-in.
Sales tax rate
Sales tax percentage rate charged on this purchase.
Traditional financing
The interest rate you may be able to receive from a bank, credit union or other lender. This is usually a higher interest rate than the manufacturer's low interest financing, but is often very competitive when used in combination with a manufacturer rebate. This calculator assumes that if you choose a manufacturer rebate you are not eligible for manufacturer low interest financing.
Low interest financing
The incentive interest rate you may be able to receive from an auto manufacturer. These rates are usually significantly below standard auto loan interest rates. Low interest financing can be as little as 0% per year. Most manufacturers allow you to choose either low interest financing or a manufacturer rebate, but not both. This calculator assumes that if you choose low interest financing you are not eligible for any manufacturer rebate.
Manufacturer rebate
A cash rebate paid by the auto manufacturer to you when you purchase a new vehicle. Most manufacturers allow you to choose either low interest financing or a manufacturer rebate, but not both.
No sales tax deduction for trade-in
If you live in a state where your sales tax is calculated on your full purchase price check this box. If this box is unchecked sales tax is calculated on the purchase price less trade-in. Currently California, the District of Columbia, Hawaii and Michigan allow no deductions for trade-ins when calculating sales tax. In addition, Alaska, Delaware, Montana, New Hampshire, and Oregon have no sales tax on autos.
Calculate sales tax before rebate
Some states will calculate sales tax on your purchase price before a manufacturer's rebate is applied. If your state calculates sales tax on the vehicle price before the rebate is applied, check this box.
The Best Time to Buy Your Ram
This link has advice on when you are likely to get the best price on your new truck. LINK
Why Invoice is the New MSRP LINK
How to Get the Best Price on Your New Ram
UPDATE: I am rarely updating this anymore so some of the information may be out of date. Check the most recent comments for new information. 2/11/22 With differing degrees of work you can get a good to great price on your new truck. We will start with the discounted price on the truck and cover...
5thgenrams.com
Last edited:
