Auto Rebate or Low Financing: 3 Ways To Get The Best Deal

Are you dreading the dent in your wallet that comes with making a new car purchase? Car prices are just insane right now, and it's in your best interest to save anywhere you can. Dealer and manufacturer discounts can help you get the best bargain possible, and knowledge about these rebates and deals is so important so you can feel confident in your purchase.

Today on the blog, I’m going to teach you how to mix and match offers to save money on your new car purchase.

Which Discounts Can Dealerships Offer?

What is a Dealer Discount?

In a traditional negotiation at the dealership, you're working with a salesperson to get the best deal and added extras like window tinting or a special safety feature add-on. These discounts and extras come from the dealership's bottom line.

A dealer discount is the amount of reduction or contribution made by the dealer to reduce the value of the manufacturer's suggested retail price (MSRP).

Whether you're negotiating in the salesperson's office or answering a "Take $5,000 off the listed price" advertisement from your local dealership, it's in a dealer's best interest to deliver deals that entice you to buy from them instead of the dealership down the road.

Which Discounts Can Manufacturers Offer?

What is a Manufacturer Rebate?

We love instant gratification, but we'll accept savings any way we can! Manufacturers' rebates are cost reductions refunded by the manufacturer after purchase.

For example, let's say Jeep is offering a $4,500 rebate on a Jeep Grand Cherokee. That's a manufacturer discount, not a dealership discount. No matter which dealership you visit in the participating region, you're guaranteed at least $4,500 cash back.

Before car shopping, check the manufacturer's website to find out about their current rebates in your area. Going into a dealership well-informed means the car salesperson won't be able to take credit for the discount.

What is an APR Special (Low interest rate)?

Unfortunately, it’s just the case that as of right now, interest rates are incredibly high. Even with excellent credit, as a buyer, there's not much you can do to lower the interest rates at the bank. But when you own the lending agency, you can do whatever you want. Hello, Toyota Financial Services, GM Financial, and other manufacturer lending agencies.

While supply is steadily building, demand is not. To ease high-interest rate anxiety, some manufacturers are offering 0% financing through their lending agencies in a season when most loan rates are over 7%.

Manufacturers offer low or no interest rates to help people get excited about buying a car. For example, buyers can get 0% APR for 60 months on a 2023 Titan pickup truck through Nissan Finance.

Can I Mix and Match These Deals?

You can 100% mix and match a dealer discount and either a manufacturer rebate or an APR special. But the manufacturers typically don't allow you to double dip with a manufacturer rebate and an APR special.

Which Manufacturer's Deal Should I Choose?

So, how should you choose between low interest rates and bonus cash? This is a math equation, and I'll help you solve it!

Head over to Edmunds.com for an incentives calculator that will turn complicated calculus into simple arithmetic. Discover which option saves the most money when you add the following information to Edmund's Low APR vs. Cash Back Calculator:

• Zip code

• Car price

• Sales tax rate

• Title and registration costs

• Cash incentives

• Loan term

• Promotional APR

• Market finance rate

• Trade-in value

• Amount still owed on trade-in

• Cash down payment

With this information, Edmunds calculates the total loan amount, monthly payments, and amount saved with both options before making a recommendation.

For even more savings tips, check out "How To Save At The Dealership”, a short-form video course that will teach you everything you need to know about saving money while shopping for a car. I'm so confident it works that if you don't save at least the cost of the course on your next car purchase, I'll give you your money back!

Have you utilized dealer discounts and incentives from the manufacturer while buying a new car? Let me know your experience in the comments! And to keep up with the latest information in car buying, check out my recent posts: