Buying a car on a low budget - frustrating!!

[NerdGirl123]

I just need to vent somewhere!

I need a new car. My current car is 13 years old and falling apart. It's no longer financially sensible to continue pouring money into repairs, as the car itself is only worth about $1,500 at the most.

I have a decent down payment put aside ($1,500) plus my current car to trade in. My credit is "average" right now (not by my doing, but my husband's financial irresponsibility). I can spend no more than $100 a month on a car payment. I am fine with an older car as long as it's sound and reliable.

I am having THE WORST time finding a vehicle. Financing is being denied. Dealers beg me to come in and test drive cars so they can get me in a chair, only to tell me after the fact that they won't be able to find financing on an older, lower priced car. But an older, lower priced car is all I can afford. One dealer said "We need a down payment that is 1/3 the total price of the car," I said "Fine, I can do that," then he says, "Oh, but wait, the banks have a minimum of what they'll finance and this won't leave you with enough of a loan." Seriously? The bank is worried that I have too MUCH money to put down on the car? But the dealership requires a 1/3 down payment?

I am so frustrated right now. I can't keep applying for auto loans, either, because every hard inquiry on my credit report looks bad and brings down my credit score. And I need to get the score UP so I have a better chance of being financed!

For crying out loud, I'm just a woman who needs a car to get to work and back :-/

 

[Josiah]

Yeah, the typical new car sells for something like $35,000. The sticker on our Honda was over $42,000. The Subie I drive was almost $35,000. And half of new cars are more expensive than that.


BUT there ARE some cars with half their life still in them selling for under $5,000. But these would be private sales and full cash only. You could get a 2005 Camry or Accord for that kind of money with 100K on it, and there would be another 100K plus miles left in that car. You'd have to be very patient but those kind of deals are out there. Personally, I'd stick with Toyotas, Hondas or Subarus - cars famous for being very reliable and durable. And I'd stay away from used car dealers, notorious for being dishonest and often doubling the price of the car; typically the only reason to go to a used car lot is to pay way too much for the car, that's especially true on the "low end."






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[Albion]

Hi, NerdGirl.

It appears that you'll have to buy a car outright from a private seller. In the price range you are thinking of, there should be opportunities. A local mechanic can give it a lookover in advance so that you don't buy a lemon; and this might be free of charge if that mechanic is someone you regularly go to for oil changes, etc. You'll probably have to sell your own for whatever you can get for it, it goes without saying.

But in any case, this ought to be better than financing it and using a car dealer.

 

[tango]

On the topic of a private sale, are you able to take out a personal unsecured loan to make up the difference between the cash you have on hand and the amount you'll need? Chances are it will cost more than a loan secured on a vehicle but it should give you more flexibility to shop around.

If you're using a personal loan you shouldn't have a lien on the car you buy and you can take your money anywhere. Depending on just how things work where you live you might be able to get an idea of how much you could borrow without a hard credit inquiry, which will then give you a better idea of what you can afford as you go looking.

Buying from a dealer is convenient if they will take your existing car as a trade-in but, as others have said, many dealers will offer you a poor price for your trade-in and charge you a high price for what you buy. Buying and selling privately means you'll have to either buy a new car before selling your existing one (and carrying a chunk of extra loan in the meantime) or selling your car first and being without it until you buy another one. Whether either of those situations are workable or acceptable to you needs to factor into the process. Also consider any additional costs - depending on where you live and how they manage license plates you may have extra costs if you need to get an extra plate for your new car and subsequently surrender your existing plate.

If you take an unsecured loan and look to go private, check you can make a lump-sum repayment of the loan without penalties. Otherwise you'll end up with the $1500-odd from selling your car sitting around while the matching $1500 on your loan costs you extra in interest.

Another option it may be worth considering, but only if you can manage it within the timeframes that would work and have the self-discipline to maintain a payment schedule that wouldn't be enforced, is to see if you can find a credit card that offers 0% interest for long enough to repay most or all of the money you'll need. A private seller almost certainly won't take a credit card but if you already have credit facilities you may be able to take a cash advance on one card, then do a balance transfer to another card and lock in a 0% rate. You'll incur some up-front costs depending on your card (which will include a fee for a cash advance and possibly a fee for the balance transfer), and this will only work out well if you can repay at least most of the loan within the 0% interest period. If you can't manage that then forget about this option unless you really have no others - the last thing you need is new your car costing you 20% interest or more.

With Hertz recently announcing bankruptcy and potentially flooding the market with lightly used cars there's a fair chance the knock-on effects will depress much of the rest of the market, so you could find you're looking at a good time.

 

[NerdGirl123]

Yeah, the typical new car sells for something like $35,000. The sticker on our Honda was over $42,000. The Subie I drive was almost $35,000. And half of new cars are more expensive than that.


BUT there ARE some cars with half their life still in them selling for under $5,000. But these would be private sales and full cash only. You could get a 2005 Camry or Accord for that kind of money with 100K on it, and there would be another 100K plus miles left in that car. You'd have to be very patient but those kind of deals are out there. Personally, I'd stick with Toyotas, Hondas or Subarus - cars famous for being very reliable and durable. And I'd stay away from used car dealers, notorious for being dishonest and often doubling the price of the car; typically the only reason to go to a used car lot is to pay way too much for the car, that's especially true on the "low end."

That's what I'm thinking I'll have to do as well. I just don't know how I'm going to survive with my falling-apart car until I can save $5,000, if I can ever even save that much all at once I also don't know ANYTHING about cars, so I wouldn't be able to like, look it over and inspect it to see if anything looks shady about the car. That's my only worry about buying from a private seller, they could be hiding all sorts of problems with the car and I'd never know.

 

[NerdGirl123]

Hi, NerdGirl.

It appears that you'll have to buy a car outright from a private seller. In the price range you are thinking of, there should be opportunities. A local mechanic can give it a lookover in advance so that you don't buy a lemon; and this might be free of charge if that mechanic is someone you regularly go to for oil changes, etc. You'll probably have to sell your own for whatever you can get for it, it goes without saying.

But in any case, this ought to be better than financing it and using a car dealer.

Thanks for the advice! I don't really have a local mechanic that I have any sort of trusted relationship with, unfortunately. But can't hurt to ask if they'd be willing to look at the car.

 

[NerdGirl123]

On the topic of a private sale, are you able to take out a personal unsecured loan to make up the difference between the cash you have on hand and the amount you'll need? Chances are it will cost more than a loan secured on a vehicle but it should give you more flexibility to shop around.

If you're using a personal loan you shouldn't have a lien on the car you buy and you can take your money anywhere. Depending on just how things work where you live you might be able to get an idea of how much you could borrow without a hard credit inquiry, which will then give you a better idea of what you can afford as you go looking.

Buying from a dealer is convenient if they will take your existing car as a trade-in but, as others have said, many dealers will offer you a poor price for your trade-in and charge you a high price for what you buy. Buying and selling privately means you'll have to either buy a new car before selling your existing one (and carrying a chunk of extra loan in the meantime) or selling your car first and being without it until you buy another one. Whether either of those situations are workable or acceptable to you needs to factor into the process. Also consider any additional costs - depending on where you live and how they manage license plates you may have extra costs if you need to get an extra plate for your new car and subsequently surrender your existing plate.

If you take an unsecured loan and look to go private, check you can make a lump-sum repayment of the loan without penalties. Otherwise you'll end up with the $1500-odd from selling your car sitting around while the matching $1500 on your loan costs you extra in interest.

Another option it may be worth considering, but only if you can manage it within the timeframes that would work and have the self-discipline to maintain a payment schedule that wouldn't be enforced, is to see if you can find a credit card that offers 0% interest for long enough to repay most or all of the money you'll need. A private seller almost certainly won't take a credit card but if you already have credit facilities you may be able to take a cash advance on one card, then do a balance transfer to another card and lock in a 0% rate. You'll incur some up-front costs depending on your card (which will include a fee for a cash advance and possibly a fee for the balance transfer), and this will only work out well if you can repay at least most of the loan within the 0% interest period. If you can't manage that then forget about this option unless you really have no others - the last thing you need is new your car costing you 20% interest or more.

With Hertz recently announcing bankruptcy and potentially flooding the market with lightly used cars there's a fair chance the knock-on effects will depress much of the rest of the market, so you could find you're looking at a good time.

I don't qualify for a personal, unsecured loan at this time. Thank my husband for that, he wrecked my credit score.

 

[NerdGirl123]

I did hear about Hertz, and looked at their nearby inventory, but nothing was in my price range. But I'll keep looking. I have no choice!

 

[tango]

I did hear about Hertz, and looked at their nearby inventory, but nothing was in my price range. But I'll keep looking. I have no choice!

Even if nothing is in your price range a sudden surge in supply at a higher price should push prices for everything else at that price point and below down as well.

If you can get a 2-year-old car for the kind of money you'd normally expect to pay for a 4-year-old car, that 4-year-old car is going to drop in price, and so the effect ripples down.

 

[NerdGirl123]

Even if nothing is in your price range a sudden surge in supply at a higher price should push prices for everything else at that price point and below down as well.

If you can get a 2-year-old car for the kind of money you'd normally expect to pay for a 4-year-old car, that 4-year-old car is going to drop in price, and so the effect ripples down.

Let us hope so! I will keep my eyes open

 

[Lazy Suesun]

This 2019 article may help. LINK

On a side note you might look to see how much it would be to install a new engine and transmission into your current car. Or replace the one that is causing the most problems now and save to replace the other later.

Also, there are church groups that have cars for free for those who are on a limited budget or are deeply in need of finances in order to bounce back into being a productive citizen. You might check around at local churches to see if any offer such programs.
LINK

 

[NerdGirl123]

This 2019 article may help. LINK

On a side note you might look to see how much it would be to install a new engine and transmission into your current car. Or replace the one that is causing the most problems now and save to replace the other later.

Also, there are church groups that have cars for free for those who are on a limited budget or are deeply in need of finances in order to bounce back into being a productive citizen. You might check around at local churches to see if any offer such programs.
LINK

Unfortunately, there's a lot more wrong than just the engine/transmission. The total value of the car right now is only about $1000-$1500 so I can't justify spending half of that on repairs, only to have something ELSE fall apart in a month or two. I think I got a bit of a lemon with this car. I've only put about 20K miles on it in the past 5 years, and it shouldn't be in the state it's in. Ah, well, live and learn!

I plan to have a local mechanic do a look-over of any used car I end up buying. That's the only thing I can think of, to avoid another problem vehicle.

 

[Lazy Suesun]

Unfortunately, there's a lot more wrong than just the engine/transmission. The total value of the car right now is only about $1000-$1500 so I can't justify spending half of that on repairs, only to have something ELSE fall apart in a month or two. I think I got a bit of a lemon with this car. I've only put about 20K miles on it in the past 5 years, and it shouldn't be in the state it's in. Ah, well, live and learn!

I plan to have a local mechanic do a look-over of any used car I end up buying. That's the only thing I can think of, to avoid another problem vehicle.

When something goes wrong with a car the usual rule of thumb one might keep in mind when looking for the problem is the system map. Check from, the fuel to the fire and then from the fire to the fuel. Most mechanics know what that means in following the "map".When it comes to a car running badly those are the trails to follow for the problem.

We had a 1982 Pontiac Sunbird that started to go bad in 2000. We put a new engine in because all driving issues have to do with that main point, while the transmission was in great working order. That little car got us from point A to B for another 17 years.
We made the investment after we tallied all the bills for the repairs to date.

I hope you find something.

 

[NerdGirl123]

When something goes wrong with a car the usual rule of thumb one might keep in mind when looking for the problem is the system map. Check from, the fuel to the fire and then from the fire to the fuel. Most mechanics know what that means in following the "map".When it comes to a car running badly those are the trails to follow for the problem.

We had a 1982 Pontiac Sunbird that started to go bad in 2000. We put a new engine in because all driving issues have to do with that main point, while the transmission was in great working order. That little car got us from point A to B for another 17 years.
We made the investment after we tallied all the bills for the repairs to date.

I hope you find something.

That's awesome! The engine in my current car isn't too bad, though it's starting to have trouble starting in very hot/humid weather (mechanic claimed they could find nothing wrong, but charged me $350 for new spark plugs as a 'suggested repair', that did not solve the problem), and the transmission is starting to get a little 'sticky' when decelerating. But the whole front end has been clanging for a long, long time and needs a lot of work, the driver's window has stopped working, the passenger lock and trunk lock don't work with the key anymore, the hood latch broke (another 'repair' that was done, but still didn't fix the issue completely), need front tires ASAP, etc. Just little things starting to fall apart over time and add up. Unfortunately, I left these things to my husband to take care of, but he just ignored and neglected them until it was a pile of problems that are too expensive to tackle now. The next car I own, I'll just have to take care of all these things myself, and since I know little about cars, I'll probably get taken for a ride (haha, car puns) every time I visit a mechanic.

 

[Lazy Suesun]

That's awesome! The engine in my current car isn't too bad, though it's starting to have trouble starting in very hot/humid weather (mechanic claimed they could find nothing wrong, but charged me $350 for new spark plugs as a 'suggested repair', that did not solve the problem), and the transmission is starting to get a little 'sticky' when decelerating. But the whole front end has been clanging for a long, long time and needs a lot of work, the driver's window has stopped working, the passenger lock and trunk lock don't work with the key anymore, the hood latch broke (another 'repair' that was done, but still didn't fix the issue completely), need front tires ASAP, etc. Just little things starting to fall apart over time and add up. Unfortunately, I left these things to my husband to take care of, but he just ignored and neglected them until it was a pile of problems that are too expensive to tackle now. The next car I own, I'll just have to take care of all these things myself, and since I know little about cars, I'll probably get taken for a ride (haha, car puns) every time I visit a mechanic.

$350. for new spark plug install? Yikes! The trouble starting in humid or hot weather sounds like the Distributor. The good news is, it has something to do with those spark plugs.
One thing you could do is take your car to a car parts store, like Advanced Auto, and ask them to do a diagnostics check. It's free. They plug this handheld machine into the dash and anything that's wrong with your car shows up. It's a great way for them to sell you parts, but it is also a great way for you to get an idea of what's up under the hood.

Armed with that free info you can go on the Net to any search engine and enter in what ails your car. Like the starting issue you mentioned. I did that and found the Distributor info. (Linked here)

With regard to your transmission, and all fluids actually, have you checked your transmission fluid level? I Googled what you wrote about your transmission and found these hits.
That may be why your front in is clanging. When's the last time you checked your motor oil? It could also be your suspension. Or, a motor mount might be cracked.
When I was in high school there was an elective I could have taken at the local technical college. Auto mechanics. Oh, to go back in time. If I'd have made a career out of it who knows? I could be one of those mechanics people can trust and who doesn't want to fatten her retirement fund on just car job.


Don't be discouraged about mechanics. The bad ones make us think they're all bad. Good ones are out there. Praying for you.

 

[NerdGirl123]

$350. for new spark plug install? Yikes! The trouble starting in humid or hot weather sounds like the Distributor. The good news is, it has something to do with those spark plugs.
One thing you could do is take your car to a car parts store, like Advanced Auto, and ask them to do a diagnostics check. It's free. They plug this handheld machine into the dash and anything that's wrong with your car shows up. It's a great way for them to sell you parts, but it is also a great way for you to get an idea of what's up under the hood.

Armed with that free info you can go on the Net to any search engine and enter in what ails your car. Like the starting issue you mentioned. I did that and found the Distributor info. (Linked here)

With regard to your transmission, and all fluids actually, have you checked your transmission fluid level? I Googled what you wrote about your transmission and found these hits.
That may be why your front in is clanging. When's the last time you checked your motor oil? It could also be your suspension. Or, a motor mount might be cracked.
When I was in high school there was an elective I could have taken at the local technical college. Auto mechanics. Oh, to go back in time. If I'd have made a career out of it who knows? I could be one of those mechanics people can trust and who doesn't want to fatten her retirement fund on just car job.


Don't be discouraged about mechanics. The bad ones make us think they're all bad. Good ones are out there. Praying for you.

Thanks for the tips! I may bother you again if I need some advice in this area

 

[Lazy Suesun]

Thanks for the tips! I may bother you again if I need some advice in this area

Happy to help.

Hubby was in a car accident a few years ago. Our insurance company declared his car totaled due to the at-fault drivers negligence. ICompanies have a penchant for doing the math that ends up more often than not inconveniencing their customer. If it costs more to fix than what the car is deemed in value, it's totaled.
We received a pittance for the value of the car considering what's out there in the used market to purchase as substitute. But wouldn't you know our adjuster gave us the robot assurance: "You can find plenty of nice used cars for that amount...." Oh, point me to the dealership you know exists where those type cars are to be found, please. Blank stare, blink,blink, OK, thank you for being a ___years customer with Geico, have a good day.
What? No answer?

We found a gorgeous little Ford that had two barely there dings and with pristine interior. Our neighbor mechanic had it on his front yard, selling for a friend.
Then we found out it needed a new transmission after two days. Thousands of dollars! Now we knew why the friend was selling it.
Thankfully we got our monies back. Then my God Daughter's family heard about our situation and sold us a family car they'd garaged after buying a new one the year before. $100.00!
We still have it. Blessings like that are rare.
Last year I was rear ended by someone who was more in love with monitoring their phone than watching traffic at the red light intersection ahead.
Blessings again. Yes, my car looks like the Jolly Green Giant tried to punt my backside across the goal line, but other than that everything on the car , including the rear lights, works perfectly. Only thing needed replacing was a cracked motor mount.
We kept the car, took the value in a check after we "bought back what the ICompany totaled, and are still on the road. Sure enough, same robotic assurance this time too. You can find a great car for the money.....
We're happy to feel like we did thanks to Carol and David. And at the low low price of one Benjamin Franklin.

Insurance companies are not in the business to assist clients. Don't believe the lizard! They're in business to make money.
At time of renewal we're looking to the AAA insurance company to see what their rates are. No board or stockholders to be beholding to. That could mean something good. No lizard either.

 

[NerdGirl123]

Happy to help.

Hubby was in a car accident a few years ago. Our insurance company declared his car totaled due to the at-fault drivers negligence. ICompanies have a penchant for doing the math that ends up more often than not inconveniencing their customer. If it costs more to fix than what the car is deemed in value, it's totaled.
We received a pittance for the value of the car considering what's out there in the used market to purchase as substitute. But wouldn't you know our adjuster gave us the robot assurance: "You can find plenty of nice used cars for that amount...." Oh, point me to the dealership you know exists where those type cars are to be found, please. Blank stare, blink,blink, OK, thank you for being a ___years customer with Geico, have a good day.
What? No answer?

We found a gorgeous little Ford that had two barely there dings and with pristine interior. Our neighbor mechanic had it on his front yard, selling for a friend.
Then we found out it needed a new transmission after two days. Thousands of dollars! Now we knew why the friend was selling it.
Thankfully we got our monies back. Then my God Daughter's family heard about our situation and sold us a family car they'd garaged after buying a new one the year before. $100.00!
We still have it. Blessings like that are rare.
Last year I was rear ended by someone who was more in love with monitoring their phone than watching traffic at the red light intersection ahead.
Blessings again. Yes, my car looks like the Jolly Green Giant tried to punt my backside across the goal line, but other than that everything on the car , including the rear lights, works perfectly. Only thing needed replacing was a cracked motor mount.
We kept the car, took the value in a check after we "bought back what the ICompany totaled, and are still on the road. Sure enough, same robotic assurance this time too. You can find a great car for the money.....
We're happy to feel like we did thanks to Carol and David. And at the low low price of one Benjamin Franklin.

Insurance companies are not in the business to assist clients. Don't believe the lizard! They're in business to make money.
At time of renewal we're looking to the AAA insurance company to see what their rates are. No board or stockholders to be beholding to. That could mean something good. No lizard either.

Wow, that's a lot of useful information! I'm taking notes here Thank you.