The best August deals: 10% off Saturns, big rebates on Buicks, home equity loans for VWs

Front ends of line of cars

Substantial discounts and all sorts of cheap loans are available from many automakers this month as the late summer push to clear out 2006 models hits high gear.

And the news gets better. Individual dealers in many parts of the country are offering discounts in addition to manufacturers' rebates. This could add up to a really good deal.

According to the Wall Street Journal, some dealers are offering discounts as high as $2,000, or more, on hard-to-move 2006 SUVs and trucks. Sales of these vehicles lagged in July as gas prices climbed.

Another carrot some dealers are dangling is an employee discount -- not the one manufacturers give their employees -- but the ones dealers give their own staffs.

With programs like these available at many dealerships, it pays to shop around. Most of the websites listed below allow you to contact dealers in your own neighborhood, or anywhere else.

If you are in the market to buy a car, this is probably the best time of the year to shop because deals abound.

As you might suspect, we are big fans of low-cost loans. Typical manufacturers' offers are based on the length of the payments, such as 0% for 24 months, 2.9% for 36 months, 3.9% for 48 months, or 4.9% for 60 months.

All are far less than what you'd pay for the typical auto loan and can save you a ton of money.

Let's say you were borrowing $20,000 for 60 months at 7.97%, which is national average in our most recent survey. You'd be paying $405 a month and $4,314 in interest over the life of the loan.

But at 4.99% your payment drops to $377 a month and you only pay $2,640 in interest or 38% less.

That's why you should know about all the incentives you can choose from before you go shopping and absolutely before you begin bargaining.

You should also be aware that July sales were sharply down at most of the traditional American car and truck brands.

General Motors Corp. and Ford Motor Co. truck sales took a particular beating, falling 28.5% and 44% respectively. And for the first time ever, Toyota Motor Co. sold more cars and trucks in the United States than Ford.

As a result you can expect bigger discounts on cars and trucks sold by traditional American brands such as Chevrolet, Ford, Buick, Saturn and Dodge, than on comparable models from Honda, Toyota and even Hyundai.

According to Edmunds.com, discounts on GM, Ford and DaimlerChrysler's American brands (that's Dodge, Chrysler and Jeep) averaged $3,961 per vehicle in July, compared to $3,110 for European-brand cars and trucks, $1,683 for Korean brands and $1,361 for Japanese brands.

These are our three favorites for the month of August:

10% off on 2006 models at Saturn

Saturn is offering 10% off on all its new 2006 models including the Ion small car, Vue sport-utility vehicle and Relay minivan. There are no footnotes on this offer and there is no small print at the bottom of the page just a flat 10% off every new 2006 Saturn.

Generous financing and rebates at Buick

Buick is offering $3,500 cash allowances on the 2006 Ranier and Rendezvous sport-utility vehicles. There's a $1,500 rebate on the Lucerne, Buick's most expensive sedan, and $2,000 cash back for the mid-size LaCrosse sedan and Terraza minivan.

Qualified buyers have the option of getting 0% financing instead of the cash rebate. A couple of minutes with a calculator would determine which offer is best for you.

Home equity financing at Volkswagen and Audi

This offer cannot be ignored, if points for originality count.

Volkswagen and its Audi luxury brand will arrange a home equity line of credit at 1% below prime (that's 7.25% right now) that you can use to buy your car.

The major advantage of that kind of deal is that the interest on your payments is tax deductible and if you're tight on cash some month, you only have to pay the interest and can let the principal slide.

The major disadvantage, of course, is that you are using the equity in your house to buy a depreciating asset and you'll need the discipline to pay that loan off in no more than four or five years.

Another disadvantage is that the interest rate floats with the prime and you shouldn't be surprised if those rates go up another quarter-point this year.

Remember, not everyone qualifies for 0% or low-interest loans. Some incentives are regional and only available in some parts of the country. That's why our links to the manufacturers' Web sites often ask for your zip code or for you to show where you live on a map.