It’s the time of year to file taxes. If you’re anticipating a refund, you should look into using it to help with a used vehicle purchase. This is a smart way to use your refund because you’ll find that auto dealerships, like F&M Auto Sales, offer plenty of refund-specific incentives around this time.
Your tax refund can become a solid down payment for a used vehicle. The average down payment for a used vehicle is usually 10% of that vehicle’s value. Most used car dealerships will accept $500 as a down payment and maybe you already have that amount saved and set aside for your down payment. Putting even more down can benefit you in more ways than you think! Here are just five major ways a larger down payment can help in the long run.
Down payments let lenders see how committed a car buyer you are. A large amount down tells them you’re serious so they are more likely to complete the loan.
When you use your refund to bulk up your down payment, it can help you get accepted with low or poor credit. Requirements vary by situation so put in your online application here. It’s quick and easy to get started.
Making a down payment of at least 10-20% of the vehicle's selling price can reduce the amount of time you have negative equity.
The amount you have to borrow is also reduced the larger the down payment is, which leads to lower monthly payments and/or being able to sign a shorter loan term.
On top of all of that, you’ll pay less money in interest charges over time when you apply a large down payment upfront.
The average tax refund for 2020 was $2,827, according to an independent report from the National Taxpayer Advocate (NTA). Even if you don’t receive a refund in that range, $1,500 would allow you to put 10-20% down on a used vehicle that is $15,000 or under! Check out our selection of vehicles in the $15K or under price range here.
This tax season, if you are looking to put your refund towards upgrading your vehicle, come visit F&M Auto Sales. We are currently running tax time savings! Contact our friendly team to get any car-buying questions answered and professional advice regarding auto finance options for your specific situation. Choose from over 150 affordable, reliable used vehicles. But they won’t last long! Browse our full selection of used Chevy, Ford, Jeep, and more now. Located at 13000 E. 8 Mile RD Detroit, MI 48205