How the comparison works
At 0% APR you repay the price in equal payments with no interest. With the rebate you finance a lower amount at the other loan's note rate divided by 12. The cheaper choice is the one with the smaller total of payments.
Worked example
A $30,000 car over 60 months costs $500 a month at 0%. Taking a $2,500 rebate and financing $27,500 at 6% costs $531.65 a month, or $31,899.12 in total, so 0% saves $1,899.12.
If the other loan were also 0%, the rebate would win by the full $2,500.
When the rebate wins
A big rebate, a low outside rate or a short term favor the rebate. 0% offers usually need excellent credit.
What this calculator assumes
The same term for both and no sales tax, fees or trade-in. Totals aren't discounted for when you pay.
Borrowing in the UK?
The country choices above the inputs open separate local pages. In the UK the page works out repayments on an interest-free loan and the APR a fee adds. Choosing United Kingdom opens that page and resets the inputs; amounts are not converted.
For the UK version, use the UK interest free loan calculator in pounds.
Inputs for the US zero interest loan calculator
Price
The amount you'd finance, in US dollars.
Term
How many monthly payments.
Cash rebate if you skip 0%
The discount offered instead of 0% financing.
Interest rate on other financing
The note rate from your bank or credit union.
CALCULATOR QUESTIONS
US zero interest loan calculator questions
Is 0% APR better than a rebate?
It depends on the rebate, the outside rate and the term. Compare the total you'd pay each way.
Is 0% APR really interest free?
Yes. A true 0% APR loan charges no interest, though late fees can still apply. Don't confuse it with a deferred-interest deal, which charges all the interest from the start if any balance is left when the promotion ends.
Who qualifies for 0% APR?
Usually buyers with excellent credit, and often only on shorter terms.
Can I get both 0% and the rebate?
Sometimes, but dealers usually make you choose one.