Tax Refund as Down Payment: The Smarter Way to Buy Used Cars

No one has to tell you again the importance of paying a high down payment while financing a used car. The considerable amount upfront increases your eligibility for loan approval and reduces the net credit amount and thus, the interest rate associated with it. But does this mean that you should burn your savings just behind a used car? Or, sacrifice that emergency fund in the race to reduce your interest payments? Not really. This tax season, you can use the tax refund you get from the IRS as your used car’s down payment. Not only is it a smarter option than giving up your savings but the way does not affect your current finances in any way.

Tax refund as used car’s down payment

As per recent IRS data released in 2020, three out of four Americans receive an average tax refund of $3,000. In the right dealership like Family Auto of Greenville, this sum is enough to pay the down payment of a quality used car.

The tax refund is ultimately your hard-earned money which you decided to withhold from the paycheck. During the last tax year, you were not saving this money for anything special. Chances are high that you were not even thinking about this $3,000 until the time of filing tax returns when you saw that you are eligible for a refund. To many, the refund comes as surprise money, and many spend it on long pending things. If your thought of buying a used car was waiting on the shelf, the tax refund money is the right opportunity to going ahead with the purchase.

No extra upfront payment required

At Family Auto of Greenville, the $3,000 average tax return is enough to buy a used car. Should you choose not to add anything on that amount while paying the down payment, you are sure to find a used car that you will want to drive at Family Auto. We have one of the largest inventories in upstate South Carolina. We procure our fleet from a variety of sources to maintain a steady supply. Your down payment amount does not decide the quality of the used car you purchase here.

On top of that, Family Auto of Greenville is a buy here pay here dealership. That is, we do not look at your credit score to approve an auto loan. You can thus finance your vehicle right in our dealership and start paying the premiums directly from your paycheck. Nothing has to go from your savings or emergency fund. You pay the down with the refund and the premiums with your earnings.

Be smart

2020 has shown us that financial turmoil can hit us at any time and often, the reason is not remotely associated with us. So, do not touch your savings. Let your daily paycheck take care of your car. Use the tax refund to buy a used car as there hardly can be a better use for the amount you were foregoing for an entire year.