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Incentives
and Rebates Here in plain english are explainations of what Incentives & Rebates programs are: Incentives and rebates are programs offered by the automotive manufacturers to increase sales. The three most common programs you are likely to encounter are in the forms of cash rebates, low interest financing, and leasing specials. Some manufacturers also provide first time buyer, military, and other programs to target specific customer segments. Manufacturers also provide marketing support directly to dealers, (which may or may not be passed on to consumers.) The most common type of program is a dealer cash incentive. Cash Rebates are provided by the manufacturer directly to the customer at the point of sale to lower the cost of buying the vehicle. Consumers normally choose to use the cash rebates as a down payment against the new vehicle purchase price. Low-Interest Financing is a lower subsidized finance rate offered by the manufacture's finance company. Eligibility is limited based on the customer's credit worthiness (FICO score). Leasing Specials are offered by the auto manufacturer to increase sales by lowering the customer's monthly payment by subsidizing the vehicle's Residual Value or Money Factor. Dealer Cash Incentives are normally paid to the dealers by the manufacturers to support the sales of a specific model line or trim.. There are lots of variations of incentives but the most common dealer cash incentive is where the dealer receives a cash credit (fromt he manufacturer) upon the sale of a vehicle. Sometimes dealers earn cash bonuses when they achieve sales volume targets. There are also programs where a dealer earns the incentive upon purchasing a vehicle from the manufacturer
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