How Can You Use Your Tax Refund to Buy a Used Car?
If you intend to buy a used car with your tax refund, the work must have started right when you had started your employment. You must have withheld a considerable portion of your salary in the W-2 form to be paid as taxes and are now expecting a heft sum from the IRS. Or, you might have taken advantage of a few credits and deductions and your taxable income has suddenly reduced, making you eligible for a refund. Either way, you are set to receive a refund and you have made up your find that you want to buy a used car with it.
The real question is – how can you just use your tax refund to buy a used car without touching your savings and finance the balance with your paycheck? The idea sounds logical and smart in your head but can you apply it in real life? Let’s find out.
Use the tax refund as a down payment
The IRS paid an average of $3,000 to each taxpayer in 2019 alone. Going by that figure, you can use the entire sum as a down payment to buy a used car in South Carolina. The average price of used cars in that year hovered around $15,000. A tax refund of $3,000 clears the 20%-down-mark suggested by most experts while buying a car. So, the first answer is yes, you can buy a used car by just using the tax refund. If the sum is adequate, you will not have to use your savings.
Finance with a buy here pay here dealer
Next comes the difference. For a $15,000 used car, you can pay $3,000 as a down payment. The remaining $12,000 has to come from an auto loan. Now, if your credit score is not high enough to attract a loan from the bank or credit union, you can always visit Family Auto of Spartanburg, one of the top buy here pay here dealerships in South Carolina. We offer easy auto loans to bad or no credit score holders. We do not require a cosigner or an existing asset to approve your loan. Your current paycheck is enough to get your auto loan approved and your credit score does not matter at all.
Lastly, look for flexible financing deals
Not everyone can expect to get $3,000 as a tax refund. Not everyone can afford a $15,000 car. This is where you will need to look for flexible financing options where the dealer can customize the offer to suit your needs. Family Auto of Spartanburg has a massive inventory of used cars where you can find vehicles of all price ranges. You can also trade-in your old car to increase your down payment amount. Again, nothing has to come out of your savings. With the right financing deal and car options, your tax refund should be enough.
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