Rebates Or Low Rate Financing: Which Is Better?

When you are shopping for a new car there is a good chance that you will be faced with the question of taking rebates or low rate financing. Not every car dealer will offer both of these options, and the fact of the matter is that this can change month in and month out. But if you are faced with this decision you need to make sure that you do the right thing. After all, doing one thing over the other may cost you quite a bit of money in the long run. This is why it is quite important that you take your time.

Rebates

When you buy a new car there is a chance that the dealer will be able to offer you a manufacturer's rebate. Again, these vary based on manufacturer as well as the time of the year that it is. The nice thing about one of these rebates is that the dealer will take this money right off of the sticker price. For instance, if you are buying a $25,000 car with a $4,000 rebate, the overall price is already knocked down to $21,000. So right off the bat you can see the type of deal that you are getting.

Low Rate Financing

Some manufacturers will give you the option to take low rate financing instead of rebates. The nice thing about low rate financing is that you will not have to pay high interest charges on your new car purchase. Instead, you will be paying much more principle each month. This helps to lower the overall cost that you owe on a monthly basis. In fact, some manufacturers even offer zero percent financing in some cases. It does not get much better than that.

Which is better?

So you have to make the decision on either take rebates or low rate financing? The best way to figure out which one is better for you is to have your salesperson work the numbers on each deal. Have them show you what your monthly payment will be with the rebates and with the low rate financing. But remember, just because one comes out lower does not mean that it is the better deal of the two. Taking the rebates may be a lower monthly payment, but over time you will pay more in interest.

ake a close look at the benefits of both rebates and low rate financing so that you get eh best possible deal.