Use Your Tax Refund on a New or Used Vehicle Purchase in Texas

How Can I Best Use My Tax Refund to Buy a Car?

This is a great question! If you are expecting a large refund this year or have already received a refund, this can be a great time to make a smart financial decision with your car purchase! Here at Ron Carter in Alvin, we sell a large variety of both new and pre-owned vehicles from Chevy, Ford, GMC, Jeep, Ram and others. While we offer great prices and competitive financing options, having extra money to put towards your next vehicle never hurts! We have a list of great tips and ideas on how to best maximize your tax refund's effects on purchasing a new-to-you vehicle near Pasadena.

Use the Refund Towards a Larger Down Payment

Providing a larger down payment provides benefits like lower monthly payments and less paid in interest. Because you will be borrowing less money by putting down a larger down payment, your monthly loan payments can be much lower. This also means you can pay less in interest over the life of the term and owe less on the vehicle if you decide to trade it in or sell it around Galveston before it is fully paid off. This greatly reduces the risk of being financially "upside down" at any point as well. So, if you decide the vehicle is not right for you, you have more flexibility to sell it for a profit before the length of the term is fully over.

As we mentioned above, a larger down payment can result in less interest on the loan simply because it means you will have borrowed less money. However, it can also lead to the interest rate itself being lower or even being approved for a loan in the Houston area that you would have otherwise been declined for. This is because the lender may see it is less risky when you provide a larger down payment, and they're more likely to pass some perks on to you!

Use the Refund to Buy the Car Outright

Buying a car with cash is not feasible for everyone, but can be a great idea for some Clear Lake drivers. If you are the type of person who likes to avoid unnecessary debts, buying a car outright means you own it fully from day one. This is more popular for slightly older used cars, and having more buying power by using your tax refund can help you achieve this!

Don't Use the Refund to Buy a More Expensive Vehicle Than You Can Afford

We have all dreamed of owning a shiny new premium vehicle that will impress everyone around Pearland as we drive past. However, buying a vehicle above your means can be extremely detrimental to your financial status. If you can only be approved for a vehicle by putting down your entire tax refund as a down payment, this might not be a great idea. This may get you approved to finance the vehicle, but it could leave you with a high monthly payment that is a major drain on your budget.

Instead, you should stick within the price range you were originally looking at and could afford without the tax refund. This will allow you to then use the refund to bolster your down payment and get much lower monthly payments than you had originally anticipated!

If you have any questions or are in the market for a new vehicle, stop by and see us anytime at Ron Carter for amazing prices and services in Alvin. We're also happy to answer any questions you may have by phone or email!

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  1. Ron Carter

    3205 Fm 528 Rd
    Alvin, TX 77511

    • Sales: 281-331-3111
  2. Ron Carter Ford

    3005 FM 528 Rd
    Alvin, TX 77511

    • Sales: (281) 331-8111
  3. Ron Carter Chevrolet Buick GMC

    3205 FM 528
    ALVIN, TX 77511

    • Sales: (281) 299-0573
  4. Ron Carter Chrysler Dodge Jeep Ram

    3005 Fm 528 Rd
    Alvin, TX 77511

    • Sales: 281-245-0780
  5. Ron Carter Ford in Alvin

    3005 Fm 528 Rd
    Alvin, TX 77511

    • Sales: (281) 331-8111
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  • Contact our Sales Department at: 281-331-3111
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