Enter the vehicle price, the cash-back offer, both interest rates, and the loan term. This compares total cost across the full loan, not just the monthly payment.
Run both scenarios side by side: financing the price minus the rebate at the standard APR (Option A), versus financing the full price at the promotional low APR with no rebate (Option B). Each produces its own monthly payment and total of all payments over the loan term — whichever total is lower is the cheaper choice in dollar terms, which is exactly what this calculator computes automatically.
Yes, quite a bit. A longer term gives the rate difference more months to compound, so the low-APR option tends to pull further ahead the longer the term runs. On short terms the gap between the two rates has less time to matter, so the immediate cash-back rebate can be more competitive or even win outright — always re-check both options if you change the term.
Yes — the negotiated vehicle price and the cash-back-vs-low-rate decision are two separate conversations. Negotiate the lowest out-the-door price you can first, then decide which financing offer to layer on top; some dealers will still negotiate price after you've picked the promotional rate, so don't assume choosing one locks in the other.
Total cost over the full term is the headline number, but not the only one. Some buyers care more about the lowest monthly payment, which can favor a different option than the lowest total cost. It's also worth thinking about early payoff: a low-APR loan has less interest left to save by paying it down early, while the higher standard-APR loan from the cash-back option makes prepaying more valuable. For the underlying loan math, see the Car Loan Calculator.
Worked example: A $30,000 vehicle with a $3,000 cash-back offer, a 1.9% promotional APR, a 6.9% standard APR, and a 60-month term. Option A finances $27,000 at 6.9% for 60 months — a $533.36 payment, $32,001.56 total. Option B finances the full $30,000 at 1.9% for 60 months — a $524.52 payment, $31,471.29 total. Option B (the low rate) wins here by $530.27 over the life of the loan, even though it means giving up the $3,000 rebate.
Want the rule rather than the calculation? We computed the break-even rebate for every rate and term — and it comes out as the same percentage of price whatever the car costs. Also see the Car Loan Calculator for what the payment does to your budget, and the Interest Rate Calculator if your lender quoted a monthly figure instead of a rate.