@Anonymous wrote:
I want to buy a new car this week and have narrowed it down between a mini cooper or a nissan altima(i know totally different cars lol). I had Nissan run my credit and they told me I qualify for the 0%Apr or 1,250 cash back. If I take the 1,250 cash back then the sales manager told me my rate would be in the neighborhood of 3.9%. My question is, will I pay more in interest if I take the 3.9% rate on a longer term vs a shorter term? For example, would I pay more in interest if I take a 3.9% loan rate on a 60months loan vs 3.9% on a 36 month loan?
ps. I mini hasnt checked my credit yet but their promo right now is 0.9% and i'm pretty confident I would qualify.
Definitely yes. Try plugging in the numbers (loan amount, interest rate, and length of loan) into any auto loan amortization calculator and you'll see the amount of increased interest that you'd pay with the longer term.
IMO, the question you should be asking is what is better - the 0% interest or the $1250 cash back. You can get a rough estimate of this using the same amortization calculator. If you determine that you'd pay less than $1250 in interest over the life of the loan that you choose (e.g. 48 months at 3.9%), then choosing the cash back would make more sense.
