You’re usually on the hunt for a good deal when heading out to purchase a new car. And even if you know what you want, saving money is at the top of the list.
Manufacturers often offer rebates on new vehicles. But exactly what are these, and how do they work? Do they really save you money?
Rebates Act as Incentives
An auto rebate is a discount or incentive offered by a car manufacturer to encourage the purchase of a particular vehicle. Think of it as a cash return for purchasing a new vehicle.The rebate is an incentive by the manufacturer, not the car dealer. Although some designated car dealers may have an exclusive access to a rebate, it is still provided by the manufacturer.
Why Offer Auto Rebates?
Auto rebates are usually offered for several reasons. For example, they help boost sales of a particular model, or they may be used to clear out older inventory at the end of the year. A discontinued model may also have a rebate.How Auto Rebates Work
Auto rebates typically work by offering a discount or incentive on the purchase price of a specific vehicle. The rebate can be applied directly to the vehicle’s cost. Another option is to have the rebate provided in the form of a check or credit that can be applied toward the purchase.Who’s Eligible for Auto Rebates?
There are some rebates that are offered to specific groups of people. These may include military personnel, students, or first-time car buyers. But generally, the rebate follows the vehicle and is offered on particular vehicles.Are There Restrictions on Rebates?
Some vehicle rebates may be limited to certain models or trim levels. There may also be geographic limitations since some rebates are only available in certain regions or states.Most vehicle rebates have time restrictions. They are only offered during specific times of the year, and they do expire.
And, finally, many vehicle rebates are tied to specific financing or leasing options. This can include low-interest loans or long-term leases.
How Much Is the Average Rebate?
It’s difficult to provide an average amount for an auto rebate. They can vary widely depending on the specific vehicle or manufacturer offering the rebate. Some auto rebates may be as low as a few hundred dollars, while others may be several thousand dollars.Usually, auto rebates tend to be higher for vehicles that are slower-selling or that are being discontinued. Rebates may also be higher for higher priced vehicles. Those vehicles that come equipped with more options or features may also carry a higher rebate.
Is Zero Percent Financing Better Than Rebates?
Whether an auto rebate or zero percent financing is a better option depends on your specific financial situation. Of course, it will also depend on the terms and conditions of the specific offers available. But there are several things to consider.The rebate’s size could potentially offset a significant portion of the purchase price. This might make it better than zero-percent financing
Usually, you have to choose between a rebate or zero-percent financing. Running the numbers should help you decide.
How Rebates Are Paid
Most of the time, the rebate is deducted from the purchase price. So, for example, if your new vehicle is $50,000 and the rebate is $5,000, the rebate amount is taken off and you only have to finance the remaining $45,000. This makes it simple.But in some cases, you may want a check for the rebate instead of applying it to the vehicle’s price. It is possible for an auto rebate to be provided in check form. Some manufacturers may offer a check as a way to redeem the rebate. This way you can use it to offset the vehicle’s cost or apply it toward other expenses.
You'll need to follow detailed instructions to take advantage of an auto rebate in the form of a check. This might mean filling out a rebate form and submitting it along with a copy of your purchase or lease agreement.
Or it might involve using a special rebate code when you purchase or lease. You’ll receive a check in the mail or at the dealership once the rebate has been processed.
Read Terms and Conditions
It’s important to read and understand the terms and conditions carefully. There may be restrictions or requirements that you need to be aware of. Restrictions could mean a specific vehicle or geographic location.Use Auto Rebate to Comparison Shop
When it comes to auto rebates, the best course is to use them to comparison shop. Compare the total cost of the vehicle, including any rebates, to the price of similar vehicles from other manufacturers. That way, you can ensure you’re receiving the best deal.The Epoch Times Copyright © 2022 The views and opinions expressed are those of the authors. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. The Epoch Times does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. The Epoch Times holds no liability for the accuracy or timeliness of the information provided.
