Cheap Used Cars

Cheap used car usually means an inexpensive pre-owned vehicle. But inexpensive can mean different things to different people.

To some people, a cheap car is one that costs less than $10,000. To others, it may be one that costs $2000 or less. To most people, it simply means getting a dependable car, in good condition, for as little money as possible.

Cheap car risks
Usually, but not always, finding a cheap car means finding an older used car, possibly with high mileage. Unfortunately, the older a car, the greater the possibility for problems and expenses that were not anticipated. Exceptions can be found, of course, and with care, good cars can be found at bargain prices.

It's very important to follow the suggestions in our Used Car Buying Guide to make sure you do everything possible to reduce your chances of unpleasant surprises after you've purchased your car.

Most used cars are sold "as is" and have no warranties or guarantees. Therefore, it is important to thoroughly inspect any car you intend to buy, and not take the word of the seller about the car's condition. Also get a CarFax vehicle history report. If problems are found after the sale, you will not be able to return the car and get your money back, even if the seller deceived you.

In general, the older the car, the more effort you should take to make sure the car is in good condition and will be reliable for the time you intend to own it.

Looking at vehicle makes/models that have good reliability histories will give you an edge in this respect. Consumer Reports magazine publishes such ratings once each year in its April issue. Find copies at your local library. The ConsumerReports.org web site also publishes the same ratings.

What is a cheap car?
People who want a cheap or inexpensive car typically only think about purchase price. However, other factors also contribute to the cost of owning a car. A cheap car to buy is not necessarily a cheap car to own and operate.

For example, insurance cost must be considered. Gas mileage is important, and so is repair cost. For example, a Toyota is generally less expensive to repair than a Lexus. Luxury brands are more expensive to maintain and have higher insurance costs. Small cars usually have lower repair and maintenance costs than larger cars.

Insurance is one of the most significant costs of car ownership, especially for young drivers. Choosing the right car can save hundreds of dollars in insurance premiums. See Cheap Car Insurance for tips on finding low cost auto insurance and learn which cars have the lowest insurance rates. Be aware that some older cars are high on the "most stolen" list and therefore costly to insure. Check with your insurance company before you buy.

Cost of replacement parts, such as tires and brakes, should also be considered. Tires for a truck or large SUV are considerably more expensive than tires for a small car.

Inspection is recommended
A pre-purchase inspection is absolutely critical when buying an older used car. The kinds of repairs that might be needed on an older car with high mileage can be the most expensive. A professional inspection might cost $100-$175 but can prevent costly mistakes.

While you wouldn't need to check a relatively new car's engine compression or timing belt, for example, these should be on the "must check" list for an older car. Otherwise, you could be replacing the engine in a short time — at great expense.

Other important items on your inspection checklist should be tires, bearings, brakes, seals, hoses, belts, timing chain, transmission, differential, shocks, radiator, alternator, and fuel injectors (or carburetor). Has the car ever been wrecked and repaired? Are the air bags intact? Has the car been properly maintained and serviced?

Check for oil leaks, oil sludge, rust under the wheel wells, uneven tire wear, windshield chips or cracks, missing parts, signs of having been repainted, and dent repairs. Will the car pass emission and safety inspection required in your state and county?

Many cars such as Honda must have timing belts replaced regularly. If the previous owner of a car that you purchased has not performed this kind of critical maintenance, and you don't inspect it to find out, you are at great risk of having serious problems that could destroy your engine.

Test-drive before you buy
How does the car drive? You should test-drive any car you are considering buying. Some potentially serious problems will not reveal themselves until the car has been warmed up and driven for a few miles. Listen for unusual sounds. Try to feel for any vibrations, shaking, or steering difficulty. Drive at highway speeds as well as low speeds.

Just be aware that, when you buy a used car, especially an older one, you may be buying someone else's problems. It's your job to find out what those problems are, and to decide if you want to fix them or live with them — or turn down the deal. Don't accept a seller's offer to fix problems after the sale — it probably won't happen.

Used cars are sold "as-is" which means there are no guarantees, no warranties, and no right to return the car after the sale, even if you find out the seller lied to you about the car's condition. There is no 3-day return right, as is commonly thought, and Lemon Laws don't apply to used cars.

A cheap car with expensive problems is not cheap at all.

How to find cheap cars

Independent dealer lots are the most common place to find inexpensive used cars for low prices. Don't expect to find the car you want on new-car dealers' used car lots. Most new-car dealers only sell relatively new, more expensive, used cars.

Consignment lots offer cars for sale by individuals who pay the consignment lot to display their vehicles. It's like a used car dealer lot except the cars are still owned by individuals. You can find the location of consignment lots in your area in your telephone book yellow pages.

Internet automotive web sites such as UsedCars.com. are an excellent and easy way to search for used cars in your area, from both dealers and individual sellers. You simply plug in your ZIP code and specify the kind of car you want, and you get back a detailed list of local cars and prices.

Internet car auctions such as those at eBay Motors have hundreds of used cars being auctioned every day. You can choose to only look at specific makes and models, and only those in a specific price range.
Listing of used cars for less than $3000 on eBay Motors

Newspaper classifieds often have a "less than $4000" section, or something similar. Dealer newspaper ads frequently have a "low-price" section as well. Watch out for relatively new cars at "too-good-to-be-true" prices.

Local "auto trader" magazines found free at supermarkets and auto parts stores are also a good source of cheap used cars being sold by individuals.

Wholesale auto auctions are another place to find inexpensive used cars. Be aware that many auctions are "dealer-only." Find auctions in your area in your telephone book yellow pages.

Government and bank repossession auctions are another kind of auction that is a potential source of good deals on used vehicles. Surplus, seized, or repossessed vehicles of all types are auctioned. These may be conducted by a professional auction agency, local police department, a state agency, or a federal organization. This article, Government Seized/Surplus Car Auctions, provides more details.

Salvage vehicles are often a good source for cheap cars. Insurance companies auction off cars that have been totaled in accidents or weather disasters. Many of these vehicles have repairable damage and can be inexpensively restored. See the article, Rebuildable Damaged Salvage Vehicles, for more details.

What to pay?
We are often asked about prices and what to pay for a used car. Some people ask about how much price discount they should expect from the seller or dealer.

One form of the question goes like this: The seller wants $8000 for his car, should I offer him $7000? The answer is another question. What is the car worth? A seller can easily price a car at $8000 when it's only worth $6000. He hopes that someone who is not knowledgeable about prices will "talk him down" to $7000. He makes $1000 more than he deserves, and the uninformed buyer walks away happy, thinking he got a $1000 discount.

Before buying a used car, always check prices. There are a number of free resources online where you can easily find the information you need. One is Kelley Blue Book (www.kbb.com). Another is NADA Guides (www.nadaguides.com). And another is Edmunds (www.edmunds.com).

Based on the fair market prices you find in these guides, make your price offer to the seller based on the car's condition, mileage, and your ability to pay.

Another cheap car option - take over a lease
Another way to drive a car inexpensively is to take over (assume) someone else's car lease. This is a way to drive a good reliable used car that is almost new, for a low monthly payment and no down payment – and get cash back in some cases.

You can take advantage of the fact that someone wants out of their lease and is willing to give up their deal to another party who can pick up the payments. Some of the deals are outstanding because the original lessee made a large down payment at the beginning of the lease, which resulted in a low monthly payment. You get the benefit of that low payment, with no down payment. The best place to look for these lease transfer deals is online at Swapalease.

Yet another option - drive a free car
You may be able to get paid to drive your own car or receive a free car to drive if you qualify with one of the many companies who "wrap" vehicles as a kind of rolling advertisement billboard. This is the ultimate "cheap" car. See this article for more details - Free Cars - Fact or Fiction?

One final word
Be very careful with buying an older used car — a cheap car. Even though there are many good inexpensive used cars out there, they are not always easy to find. Furthermore, there are risks that you'll be cheated or buy hidden problems. So take extra care, please, and spend extra time to make sure you're getting a car and a deal that you'll be happy with.

Good luck.