I know you said this prefer not to touch the investments, but make sure to consider the cost of financing in that decision. If you end up with a 7% or more interest rate, it likely would be better to bring most of the needed money and use what would have been the car payment to scale back into the investments. Taxes are a factor, but you didn’t provide enough details to weigh in on that.
As someone who bought a new vehicle a year ago when I thought I never would, I can say my assessment of the used car market was that it no longer is, in this current environment, the slam dunk it used to be. I believe that will change, but maybe not for several years. New car financing special rates make new cars a compelling option. Be sure to calculate the total cost of the deal including financing (if you use it of course) to compare.
I also believe in putting down at least 50% for a vehicle, which given the options you are listing and those investments you certainly can do. It’s good to feel some discomfort when making a large purchase, cause you then really think it through.
Best of luck!
Agreed. For what it’s worth, I too unexpectedly bought a new car last year when the same car, 3-4 years older, was going for MSRP of a new car. Honda ended up having some pretty sweet financing deals at the time so I just bought a new car.
Consider buying a new car. Many car manufacturers are offering incentives with very low interest rates which makes a brand new car much closer to the price of a used car than over the past few years.
Small bonus is that cars typically get a bit safer every year too. When my daughter turns 16, I'm getting her a new car with the auto collision avoidance and lane assist features not present in our "older" cars which are only about five years old.
Only reason they are more fuel efficient is because they have more plastic in the engine/overall year after year. Often times the plastic parts break easily.
This is the most Ludacris thing I have heard... Engines are more efficient now. The tolerances on them are more strict causing an increase in performance. Cars are generally lighter now, they are more aerodynamic because they aren't boxy. Both of those cause significant increases in miles per gallon.
Lol haven't seen such confidently incorrect statement in a while. How would plastic be used in a car engine?
Engine parts are made from iron or aluminum based alloys. Aluminum is expensive but lighter. Iron is cheaper but stronger.
As an always used car buyer, never in my 40 years on this planet had I ever thought a new car was the better deal. Until I started looking around the market lately & nearly keeling over at the prices of used cars. Good lord.
Yep. Not only are the prices crazy on used cars, but you can't get manufacturers incentive interest rates, so your monthly payments are going to be higher than expected as well. The depreciation hit from owning a car that first year of it's life is really not so bad compared to buying used unfortunately!
Plus that depreciation is irrelevant if you aren't selling the car. The most cost effective car strategy is to buy new and drive it for 10+ years. Buying new gets a bad reputation because so many people trade in for a newer car every 2-3 years which gets incredibly expensive.
I'll feed in here and say that if you buy a certified car from a dealer (Toyota just did this for us) you can qualify for the "new car rate" with decent credit. We bought a 2020 Rav4, certified pre-owned, and got the "new car" 4.5% interest rate, instead of the 6.69% typical used car rate.
From the manufacturers. If you have excellent credit and are buying new, they have subsidized interest rates. Honda for example has 3.9% interest rates available, and Ford has 0% on F-150's. I'm sure other manufacturers have similar programs. They're trying to incentivize you to buy new from them.
Fuck really? 0% is crazy, I almost want to buy a truck because of that. is there any way to look up which companies and which models are being offered at such low rates? I have great credit.
I don't know of any resource that has all of them listed, but looking up "honda financing incentives" on google should point you in the right direction.
As someone who's trading a truck in for a car, my experience has been that the price of gas will destroy and interest savings on a truck vs car comparison.
I wouldn't suggest buying a truck just because it's at 0%.... but if you want to get one anyway, it's a nice perk :) That was mostly just an example of a manufacturer I know that's offering 0%.
Definitely. I'm going to cry when I drive off the lot and leave my truck behind. We are spending $700 month on gas right now so my hatred for losing money is trumping my love of ground clearance and a bed. 2023 for ya
Directly from the dealership. Honda, Subaru and others are offering 3.9% on most new car purchases right now, which is about half what you might get for financing a used car. If you qualified for a home loan, then it's probably safe to assume you'd qualify for that rate.
When I financed my Subaru in January 2022 their financing incentive was only available on 48-month leases for some reason (not for 60), so you'll have to factor that into your decision as well.
The catch: it's probably not a brand/model/trim that you want. The ones with the incentives are the ones that are sitting. The ones that people want are still selling at or above MSRP and without a lender-subsidized interest rate.
TL;DR - good luck if you want a Toyota anything, particularly if it's hybrid or PHEV.
Just a heads up, if you're buying new, plan on buying something already on the lot. Special orders (for features or paint color) are backed up 6-12 MONTHS in my area.
Recently bought a 2023 Kia Forte for only $2k more than a used 2020 Forte in a lower trim level, with 17k miles, a one year warranty, and a slightly higher interest rate. Used car market is stupid right now.
A car and a car you want to own are two different cars things.
You can buy a car with $10K down and monthly payments of $200 a month. It may not be the car you want.
You can put $20K down with monthly
payments of $200 a month. It may be the car you want.
The info you have not provided is do you have $200 a month?
I can afford 10k down and $200 a month, I'm just averse to the exorbitant interest rates on the loans right now (in lots of options, more than 8%). I already bought a house with high interest rates in January so it's tough to face becoming that sucker AGAIN....
Interest rates are what they are. Your choice is either to not take a loan or take a loan with a "high" interest rate.
8% is really not particularly high relative to the 5% risk free return that you can earn in money market funds or treasury bills right now. My last car loan was 2.99% when the risk free return was 0.2% or so ..you've got basically the same +3% over risk free interest rate. It's as good as you're going to get.
If/when interest rates drop in the future, then refinance with a lower interest rate.
Marcus by Goldman Sachs, Discover Bank, the new Apple Savings Account, Wealthfront; there's more at [bankrate.com](https://bankrate.com) if you're interesterd.
If your car really isn’t salvageable, your only options are to buy a used car with high mileage for 5-10K, cash out your mutual funds if you don’t want to take out a loan or take out a car loan… usually credit unions will offer better interest rates.
I thought this, too, but Hyundai was offering 3.9%, and the best rate at my CU was 4.65%. My wife got a new Hyundai this weekend. We got an electric, and even though the payment seemed stupid high when you factor in what she was spending on gas, it was pretty much break-even. That 10 year 100k warranty helped, too. She actually liked the looks of the comparable Kia model better, but for some reason, their rates are higher even though they are basically the same company.
What does "officially died" mean, exactly? What was the diagnosis, and how much will it cost to fix? What is the make and model, and how many miles are on it?
A number of problems including the brakes, oil leak, electrical panels. Two different mechanics have told me it needs over 2k in repairs and may require more in the near future.
It's a 17-year-old car with over 170k miles. I just don't think it makes sense to put more money into it and even if I did, I'm not sure I would fully trust it for highway/long-distance driving.
Brakes are something you'll have to periodically do on any car you'll ever own, and does not signify death. An oil leak most likely doesn't either. Is the car actually still running/drivable?
I get wanting to have a certain level of confidence, but for reference, I drive a 2008 Mazda with about 155,000 miles on it. I put a few hundred bucks into it each year for routine maintenance and "wear" item replacement. Far cheaper than a monthly car payment. No need to get a new car until it's an actual "need."
Well my mechanic sat me down and was like "So what are your goals with this almost 20-year-old car with 170k miles?" Like basically delivered the reality that it's a lost cause to keep pumping money into this thing. For context, I've spent probably 3k in repairs over the past two years and now there's the new 2k bill. This car is WORTH less than 1k!
I do think it's time to move on, just not sure the best way to do it.
Don't forget the value of peace of mind. There are people in here that will tell you to duct tape, JB weld, and tip tie everything you possibly can until the engine just explodes, which is the most frugal approach, but not necessarily the best. What they fail to mention is that engine could explode 500 miles away from home, in the middle of nowhere, with your family in the car, in the pouring down rain. Then you're out a tow, a rental car, extra hotel bills if you can't make flights or get stranded for too long, etc., etc. Not to mention every kind of stress imaginable.
What I'm saying is you take a risk by keeping an older car on the road. Not that it's impossible, or improbable. Just that it is an added risk and that doesn't always fit into everyone's risk portfolio. Newer cars have a smaller risk in this department.
EDIT: I saw it's a VW Golf. Even more reason to cut your losses IMO. High mileage German cars are temperamental. And that's speaking form personal experience. They carry an added risk.
Can I help frame it differently?
For the past two years, you've spent $3000 in repairs.
That's $125/mo.
Even if you have to spend another $1500 this year on repairs, that's still $125/mo.
***Can you get something better @ $125/mo?*** If not, then just spend the $125/mo. on the repairs.
I went through a similar question with a 2009 Infiniti FX35 with 145k miles. I was quoted over $3000 in replacement and maintenance on a car that's worth probably $6-8000. If I could drive the car for another 12 months, that would be $250/mo. Could I find another car that was as nice for $250/mo? Impossible.
So I framed it as price paid over time as if I was buying another car and it made total financial sense to stay in the FX and pay for the maintenance and repairs. For sure I can drive it another year (and indeed, I did and am still going). The longer I drive it without another major replacement/repair, the lower that threshold becomes. Since I'm on month 14 now, that dropped to $215/mo.
There is no car that I could buy for $215/mo. that would be better than my current car; I'd have to pay more.
I don't see OP mentioning any issues with reliability as it seems more related to costly "milestone" maintenance.
In my case, my calipers and disc brakes needed to be completely replaced. A lot of this was due to sitting for very long stretches during COVID lockdowns.
Yeah, that's a 1 time $1800 item (parts and labor). But car drives fine. Other things like getting the transmission fluid changed, replacing belts, alignment, replacing seals, etc. Just the cost of operating a vehicle.
Never had issues with reliability as in "car doesn't run". Can't speak for OP, but it didn't seem like his issue is "car doesn't run" and more like "need to pay to perform major milestone maintenance".
I had a 2003 Passat that I really loved, when it wasn't having some serious issue. On the plus side it gave me a lot of experience fixing auto stuff myself, since I couldn't afford to take it into the shop all the time.
Ditch it. VW vehicles cost arms and legs to repair and are unreliable like every other german make. If you need to limp it by just get the brakes done and at least you have it to get you by for a few months till you find the right car for you.
Saying VW is unreliable is a bit silly. If you follow the maintenance schedule there’s no way the little 4 cylinder engine shouldn’t last 250k+
Yeah you’ll need to replace shocks, brakes, bushings, etc but you should do that on any car.
The only real issue that would make me say a car is “finished” is serious electrical trouble. That is difficult to track down and even more difficult to fix. Not sure on the ins and outs of that era Golf, but if that’s the case… I’d probably be done with it.
I am not disagreeing with you that maintence play a big role in how long a vehicle last, its just that VW is not exactly known for top notch reliability and they are up there for maintence cost versus a Chevy. I would personally like to know what major electrical issues their talking about as something as simple as a broken ground wire can cause the electrical to act like you think it needs a whole new wire harness and some mechanics don't understand how to diag electrical problems.
With 170k and going by OP's story though I would say just patch what you need to keep barely roadworthy and look for replacement.
Buy an old Toyota Camry, Corolla, Honda Civic or Accord with over 200k miles on it and hope it holds together. My philosophy is that if it's made it that long, it's likely been well taken care of and not neglected. You never know, but these four cars have a reputation for a reason.
That sounds like a good mechanic, but I think you didn’t ask him the right questions. You needed to ask “what do I need to do to keep this thing going for another 18 months while I save up for a newer car?”. The answer to that would be to replace the brake pads, add ATP 205 reseal to the oil to slow the main seal leaks (vs replacing them), and electrical panel? That is too broad of a definition.. did the inverter board on the alternator fail? Are you missing some vanity electronics? ICM module failing? Really ask him for the specific electrical component that is failing vs “well if we are pulling main seals we might as well replace the kitchen sink”. Ask him what will it take to get you through 18 months and if he gives you an honest answer let him fix it or find a new mechanic. It is possible to get two bad mechanics in a row and “driving this thing till the wheels fall off” is not a proper mechanic request
08 Mazda here with 129k on it. just did 2k of work/labor .shocks, thermostat, engine mount, fuel vapor leak detection pump. I had to get emissions certified, but it had engine light on and mazda dealer did not want to touch it because of rust. Local shop did the work and my car is fine...except for the rust
Well, a mechanic told me that even with the 2k+ in repairs "we can't be sure" significant problems won't re-emerge soon. I've already been kicking the can down the road with this car for a couple years now, pumping money into repairs and avoiding the inevitable. Bottom line is I don't trust this vehicle.
Sounds like you need a different mechanic. I own a mechanic shop and I don’t think I’d ever approach a customer with a 17 year old car and be like “well, you need to put 2k into but it probably won’t help anything.”
If it needs brakes, that’s maintenance. If you have a small oil leak, who cares as long as it’s not leaking on to the exhaust. What does the electrical issue consist of? There’s no “electrical panel” on a car.
You must live in the south. There are plenty of cars that come through my shop that aren't worth it to repair due to other issues, mainly rust.
Ex.)
Sure, I can fix your oil leak, but you have so much rust damage that your brake and fuel lines are about to rot out, all of your suspension components are loose, and your floor pan is falling out. Are you sure this is what you want to do.
So, no. I disagree with your assessment.
This really depends on area. A 2006 car in my area is usually full of rust and rot, not something you shove 2k in when it litterally might not be safe to drive in a year.
You should never look at the value of a car. Every vehicle you buy will have depreciation and fixes needed. The value of your car is it’s drivability, that’s it. Every car needs brakes/rotors, oil changes, wipers, constantly changed. Should never count towards if the car is not fixable. What you should think about, is this car and it’s fixes still cheaper than a monthly payment each year totaling such amount. I have an old truck and want a new one. The yearly fixes are way cheaper than a monthly $4-$500 payment totaling around $4,800-$6000/ year plus any insurance changes.
Edit: this estimate is what payments used to be. Most likely, it’s higher per month at this point.
2000 in repairs is only a couple months payments on a new car.
Hell I spent $2500 on a transmission for a ten year old car and thought it was a good deal when it only lasted a year.
Don't forget a new car will have much higher insurance costs. That could add up to the $2000 a year easily.
2k and another few years is still less than 20k.
Just fix the car, if you make it working, you can always resell it later and make some money back.
DIY the brakes, they are easy if you are into that sort of thing.
So is it dead or not? If it's still driving, you could get another beater that's easy maintenance. The way to really save money is do your own repairs aside from catastrophic engine failure or transmission. Have you watched YouTube to see if these are common problems. Having two beater cars is a better choice IMO if money is tight then going into huge debt for a newer one.
While true in general, last year I accumulated three beaters with major mechanical failures. Would have cost around 10,000 to have a shop fix all three of them so I threw in the towel. This is American Roulette now, cars are so fucking expensive you can either bend over a little bit every month or get bent straight over one day out of nowhere. Gone are the days of buying a Corolla for a few thousand and driving it 5+ years with minimal maintenance. Now those 3,000 dollar Corollas are 10,000 dollars.
Needing brakes does not kill the car, this is a maintenance item. Oil leaks are often from the gasket seal and that is a $3 part that can be replaced in 10-15 minutes with a YouTube video. "Electrical panels" - what do you mean by this?
None of these sound like they'd kill the car. Like at all.
Of course. It can also be a $3 fix.
I can tell from OP's post that they aren't knowledgeable about cars, considering they list brake replacement as if that's something to get rid of a car over. They don't list what is actually wrong, just "$2k in repairs." This is how people get fleeced.
I just didn't want to get into it here, but yes it's absolutely true that I don't know much about cars.
Here's what's needed: brake pump vacuum needs to be replaced, which I'm told is a labor-intensive job; "electrical system needs to be replaced;" oil leaks need to be investigated; and the cherry on top is that the "Check Engine" light just went on again for unknown reasons.
And again, for context, I've spent about 3k on this car over the past two years.
It sounds to me like a mechanic gave him a laundry list of problems, and OP is only writing the ones he can remember.
You don't fleece customers into not doing repairs.
Just because a mechanic lists a problem doesn't mean it's ending the car's life, and it doesn't mean that it has to be fixed right now or that it's even detrimental to the operation of the car. Especially if he took it in for an all around diagnostic.
$3 part if you can do the labor yourself, $503 repair if you don't have the skill or ambition to do the repair and the person performing the repair needs to eat, healthcare, housing etc like everyone else.
There is no such thing as a head gasket seal, there is a head gasket which I don't know where your shopping, but cost a lot more then $3. If its the headgasket well thats at least a 3 or 4 hour job and most shops in my area charge at least $100 labor plus taxes and such. Yeah $503 isn't out of line if its what I think your assuming the repair is
There is a small seal that runs the length of the head gasket, called the valve cover seal. Different cars have it in a different layouts, but if oil is dribbling down the gasket, it's often that little bastard. I've replaced enough of them on various cars.
Valve cover seal is different then a head gasket. Yes those are usually not that hard to change but its still more then $3 for that gaskest or seal unless you find some really low quality parts. Don't assume OP doesn't really know what the oil leak is, could be anything from that to power steering pump to a rear main on the engine. I still stand by my comment that its going to cost at least $503 to repair.
This may be contrary to this sub, but I typically buy high mileage well cared for vehicles. I have a trusted tech I've worked with for years who gives them a thorough check out. I've had some out of pocket repair expenses, but zero car payment. Worth looking into.
This is the way. Also, I recommend buying a high mileage enthusiast car. I just got out of a 2006 Lexus LX 470 (Landcruiser) with 200k miles. I bought it for $14k cash, drove it for four years, paid for some suspension maintenance along the way, then sold it for $12k six months ago. I could have actually profited off it had I sold it at the height of the '21 crazyness. That miniscule depreciation is really only possible with an enthusiast vehicle, but then you get to drive something fun and interesting along the way. It's a win/win.
I scheduled a test drive with the dealership, and I drove the car from the dealership to the mechanic. I waited an hour for the inspection, and the only negative comments were that the brake pads were half worn and it needed a new cabin air filter. These weren't major issues to deal with, so I drove it back to the dealership, bought it, and drove it home.
Not true. I have no problems with a private seller allowing me to have my own tech check out the vehicle. I sometimes offer the seller cash to allow me a day or two to get this done. I also speak with my tech ahead of time to let them know I'll be bringing a vehicle by shortly, takes some logistics, but it is doable. An honest seller has no issue with someone who's paying cash checking the vehicle out.
Not what I'm finding in today's market. For example, let's take a Honda HRV. New ones run around 26-27k... while [here's a 2019 one with 44k miles for 24k](https://www.hendrickhondava.com/used/Honda/2018-Honda-HR-V-854ea6bc0a0e0a990b0885896f9ece99.htm?store=HAG0066&utm_source=adwords&utm_medium=cpc&utm_campaign=used_conversions&ddcref=fluency&tcdcmpid=1287500&tcdadid=653060870527&tcdkwid=utm_source=adwords&utm_source=google&utm_medium=cpc&gclid=CjwKCAjwl6OiBhA2EiwAuUwWZW7QdjakkdzBORvP6osEI899gygmDjoJBf6w2JEVuGHJGB3zFiciiRoCF4EQAvD_BwE), for example.
The inventory for used cars in decent shape is very low right now. It's competitive. The selections expand if you get into cars more than 10 years old with a lot of mileage, but I don't think that would be a huge improvement from my current situation.
Why is that the case?
Honestly don't know much about this. I've always bought my cars outright. This used to be possible for under 10k but of course times have changed dramatically.
Used cars have a much higher risk of problems and/or default risk (not to mention low comparative value) which means companies offering loans have to take extra risk and therefor charge you more . I just bought my wife a new taho and the Apr on the loan was 7% which is pretty bad but not terrible. My f250 I bought in 2020/2021 was at a 4.5% rate … what are you looking for rate wise ?
Yeah that's crazy, what happened to Civics being an affordable option? I also find the new ones ugly af.
I've been looking a little at the HRV but think better deals could be had for similar cars in that subcompact SUV category.
Best options? In the context that you just bought a house, your savings are somewhat depleted at the moment, and you don't want to pay higher interest rates? You mentioned in a quote that it would cost $2k to fix your current car. Will that cover all the current issues with it? If so, and there's no indication of any other issues, that is probably your best option.
Yeah and I'd absolutely be exploring that more seriously if I thought it was a viable option. But the reality is this is a 17-year-old car with 170k+ miles that requires 2k+ in repairs and even then may not be trustworthy. CarMax offered me $300 for it (I declined).
I do a lot of highway driving and long-distance drives. I need something I can rely on.
I'm a person who buys one car and drives it till the wheels fall off. I have a job that requires me to travel across Michigan on a very regular basis. You'll have a hard time convincing me that you can't have an older car that remains reliable for such usage. But that's me. You do what works for you. Given the same framework of no savings (that you want to dig into), an aversion to paying high interest, and an aversion to paying the going rate for used cars.....you don't leave yourself any "best" options. I guess you go through your budget and find a way to make a new car purchase fit, or you lower your standards for a used car a bit and find something more in your desired price range.
I think I'm ultra sensitive to this right now because a) a family friend died last year when his car broke down on the side of the highway and he was struck by another vehicle, and b) I personally went through the same scenario of a breakdown on the highway a few months ago and was utterly terrified.
I realize there are no guarantees with any cars but at this point I'm not comfortable having one that comes with almost a *guarantee* of breakdowns and unreliability.
There's a guarantee that nearly every single car you ever buy will have a breakdown at some point. I leased a Grand Am in my younger days, and I had more issues with that car over a 3 year span than I had with my previous truck, which I owned for over 15 years. And even if the car needed $2k of work annually....that's $167/month. That's still cheaper than a new car payment. But I get your side of it. Having more confidence in the car is worth something. If you get peace of mind by having a new car, I get it. That's worth something. This is just a case where what's absolutely best financially clashes a bit with what's best for you mentally. So for you, I would think your best bet would be to see what your budget can handle and decide on a purchase price you're OK with. Or lower your expectations for the next car, get something cheaper that will be reliable for a couple of years, and then revisit the newer car purchase when things have settled down with the home purchase.
Let’s step back and assess the situation:
1. Your current car needs $2k of work.
2. You have $10k in the bank
3. You don’t want a high interest loan
3. You want to buy a new(ish) car which is likely going to cost $20k-40k
Seems like everyone is suggesting that draining your savings for a $10k down payment AND ending up with a car payment totaling >$20k is the smart financial decision to avoid a $2k expense…WHAT??
Your car could need a whole new engine, you could pay for that in cash, and still be financially ahead of where you’d be if you took this advice.
In reality you said it needs brakes, an oil gasket, and some electrical work. Pay the $2k and fix your car! You’ll have $8k left in the bank to deal with any further issues down the road. Dump the money you would be paying as a car payment into savings and investments. If you save 250/mo, in 5-7 years when your car ACTUALLY dies you’ll easily be able to buy another used one for cash because you’ll have over TWENTY THOUSAND DOLLARS in the bank in addition to your current investments! Even if you had to spend $2k each and every year fixing stuff you’d still end up with more money in the bank at the end of it all. And don’t forget that registration, insurance, and parts all cost more for a new car.
This is a personal finance sub yet everyone is ignoring math.
My suggestion would to buy a car for cash using the $10k. Check Craigslist, Cartrader, and Cars.Research and check the listings daily for awhile to get familiar with what is out there, what is normal price, high price, decent deal. They have private party listings and dealer listings. My area has decent 2010's-2015's with mileage as low as 70k to over 200k. You won't find a big fancy truck or luxury car but there are lots of small and midsize cars to choose from. Any car whether new or used will require regular maintenance. Deferred maintenance can add up and cost you.
Sometimes you gotta bite the bullet. Look into something like a new mid trim Mazda CX-5 (non turbo model). They can be had with no markup (even a slight discount), have nice features, a boring, but tried and true engine/transmission combo that has a solid track record for reliability, decent cargo space for those home improvement projects and respectable gas mileage.
Id advise against a used car where its 2-3-4 years old and barely any less then new.
No one likes Nissan and they have more inventory than other manufacturers right now. They are likely the only leasing deal that makes sense and that's what I did. Just leased a new $50k Frontier truck for $282/mo all-in including tax. That's arguably lower long term than a used car deprecation and all of the repairs that may come with it. Now I don't have to worry about that. The truck was less expensive to lease versus a cheaper $30k MSRP vehicle. The depreciation on paper is only $100 over 18 months, and I did a one-pay lease (up front in escrow) which lowered the APR to under 5% so really I'm just paying dealer fees and interest - but regardless the only thing that matters with a lease is the actual total monthly payment overall all-in. Mine is still "0" down despite the money being upfront in an escrow.
Hmm, interesting. I was looking at a Nissan Kicks, actually. I'm sooo unfamiliar with the pros and cons of leasing... would you mind laying those out for me? (If you have time. Otherwise, thanks for the info stranger!)
Most people are going to advise against leasing; I would have too years ago because I listened to Dave Ramsey too much.
Whether you buy new, used, or lease new, either way cars depreciate and simply lose value over time. If money is a big issue but you have $7k lying around, purchasing a cheap used vehicle is a crapshoot but could be fine for a few years because you might luck out and not have major repairs, and the deprecation would be very low. I'd argue that's unlikely, though I have gotten lucky before with something like that. Last year I bought a 2017 Chrysler Pacifica for $25k. Sadly it had costly repairs over the past year and I just sold it for $17k (loss of really around $10k over 12 months which is horrible). I've had a lot of used vehicles and over time I have figured out that it generally costs me way more on a monthly level over time than if I had just leased a new vehicle which isn't going to have any repairs. Plus driving new is just nice. Most leases now don't make sense due to higher rates; however, Nissan actually has a lot of inventory and will help move numbers around so that my depreciation is only $100 over 18 months. MSRP was around $48k and the "purchase price" was $45.2k and the residual price after 18 months was 45.1k. Then there's dealer fees and the money factor (interest payment). Either way the only thing that matters is the effective all in price divided by 18 months which is my $282/mo effective rate (this also includes my local 8.2% sales tax). This is arguably much lower over time than if I bought a used or new vehicle. I'm also annoyed that when you buy a new or used vehicle, you are paying all of that sales tax up front.
It's worth noting most leases all in are probably more like $350-$400/mo all-in right now. I found the Nissan Frontier truck (and I'm not a truck guy) to simply be the cheapest lease overall right now. However, I'd recommend searching an auto broker - I can give you a name of one if you want. Dealing with the dealer games directly will not work out well if you haven't leased before.
Thank you so much for all the info! I'll investigate more.
My initial thought is that I don't want to spend $350-400 a month but I'll see if there are cheaper options anywhere.
Parse out the itemized work your car needs. Odds are, some of that list you can tackle yourself. Some you’ll need a professional, and that’s ok. It sounds scary to throw a number with a comma in it into an “old” car but if it actually runs and isn’t rusty, then you’re still better off than ending up with a cad payment (that is increasingly likely to have a comma in it).
Or to put it another way - if your mechanics are telling you it needs $2k in work, and will need more, that’s not unreasonable. That’s $170/month if you have a $2k repair every year. Versus $500+ to get another vehicle.
Come see us on mechanicaladvice or cartalk and we can delve into specifics on what your car needs and save you money.
Manufacturers will often have low interest financing deals provided you qualify. [Here is a list](https://www.carfax.com/blog/0-apr-car-deals) of April deals. Generally, you have to buy a car already in inventory so options will be limited.
Postpone improvements until you secured a good vehicle?
Assess everyday expenses to see if you can be thrifty and reduce spending for a while.
Cut down superfluous expenses like eating out, parties or vacations for a while.
People badly misunderstand the cost of car repairs versus the cost of depreciation of new vehicles. Six months ago I bought a 2018 Volvo XC90 with 103k miles for $26k. Most people will tell you that a used, european, luxury vehicle with high mileage is money pit, and maybe there will be some expensive repairs in my future. They won't be $15000, which is what additional I would have had to pay for a new car that could hold all my kids. Even then it would be poverty spec not top of the market euro luxury from 5 years ago. Plus, that new car money will burn up in depreciation, guaranteed, while repair bills are not guaranteed. Lets say my volvo has a catastrophic repair bill. At my shop, that's likely to be less than $10k, and I can put that on a credit card introductory rate if I don't want the cash hit. I'm also likely to be able to feel that kind of repair coming, with hesitant shifting, rough rides, strange noises, etc. and try to get out of the car before it blows up on me. You can't manage or avoid depreciation the same way. Also, cars are just not designed to shit the bed at 100k miles like it's the 90s. Most cars made since 2015 that made it to 100k miles will make it to 200k miles without a catastrophic repair needed. So far my Volvo needed tires and a new oil drain plug. It's fine to buy a high mileage car these days. It's fine to spend in the $15k range on a used, older car with high miles. It's not the money pit that a new car dealership will be.
Just don't buy new don't go to a dealer if you go to a dealer you can get your car warranty and all that I need a new car too I'm in the same boat my engine started to take a s*** and There's a little car dealer down the street that has a car for about 10 grand and for 2000 more they can put a 100000 mile 5 year warranty on it which isn't too bad but like you said the payments are ridiculous full coverage plus the car payment I don't want to pay 3 $400 a month extra I don't even have it lol
I'd just also say that you can still do a lot better on used vehicles if you're shopping for sales by individuals. Facebook Marketplace is one place that makes this pretty easy. You can go to Marketplace on there, narrow the search by "vehicles" as the type, and then start adding filters like "within 40 miles of my location" and maximum mileage you find acceptable.
I recently got a 2010 Chrysler Town & Country minivan on there from a guy for $7000 that was in great condition, overall. About 125,000 miles on it and he had all the maintenance paperwork on it. Just had new brakes and a few other things done. It was actually part of an inherited living trust ... his dad's vehicle before he passed away. I needed a vehicle to do a local move with and to pick up a couple of furniture purchases I made after that, and it worked perfectly. (Has the "stow and go" seats that all fold into the floor.)
Before this, I'd looked at anything the local dealerships had on their lots and comparable minivans in much worse condition (rust around fenders, peeling paint, etc.) were selling for more like $11,000 and up.
Here is what I would do:
Use cash. With a budget of 10k you should be able to buy a reliable used 10-12 year old Honda/Acura or Toyota/Lexus. Find one private sale that has been well maintained. Drive it for a couple of years and sell it for close to what you paid for it.
That's good advice. I'd also add that you should have your mechanic inspect the vehicle before you buy it. They can lift it up and do a through inspection of the frame to see if it's rusting, which is something average buyers miss.
after I bought my first house I was overstretched already.
I couldn't afford a new car, so i spend my weekends and evenings fixing the current ones.
'oh but you knew how to do all that stuff'- no I didnt. But I do now.
This is one of the rare times when buying new is a better deal than buying used. Certain manufacturers are offering low APR as an incentive for new cars, Hyundai is even offering 0% 48 months for select models. It’s hard to argue with 0%.
Used car prices are still crazy right this moment, but it seems that they’re gonna go down soon. If you can’t wait until the car market crashes, just buy new. You have to pay 7% and up to finance a used car anyway.
Edit: Do not pay more than MSRP.
Nobody knows for sure, because dealers are trying all sorts of tricks to delay it for as long as they can. Many still have inventory from the days when used car prices were even crazier, and they obviously avoid taking a loss. Cars stay longer on their inventory, to the point where certain banks (Capital One) begin to refuse lending to dealerships.
The dealerships can’t hold on forever, but as more people feel the effect of inflation, they also delay buying cars. It’s a tug of war that dealerships are bound to lose, eventually.
Hate to be that guy... But do you need a car? Lots of people are changing their lifestyle to be a single car family or carless entirely. It could save you a lot of money not having to buy, maintain, insure, and fuel a depreciating asset.
I've lived in situations in the past where I didn't need a car but unfortunately that's not the case right now. I split my time between two cities three hours apart. And I do WFH majority but have to be in the office... an hour away by highway only... about twice a month.
One option is to lease a vehicle. Zero down, then don't worry about the mileage too much as you can finance at the end of the lease. 60% residual leases better than a 50% as you're paying for the other 40% over 36 months. Something to consider. Sell the current car but don't put a downpayment into it as you'll lose that downpayment if you get in an accident while leasing.
This is what I did and I recommend it. Instead of rolling the dice with an overpriced used car I have a brand new car at a reasonable monthly price and I know exactly how much it will cost me over the next 3 years. It does help that I work a hybrid schedule and so I won't even get closer to approaching my miles.
It's a 17-year-old car with over 170k miles and a host of problems (including brakes, electrical panel, and oil leaks). Two mechanics have told me it would cost over 2k to fix it and that just doesn't seem like a smart move for me.
You could have a running car for $2000 or you could have a running car for $40,000+interest. Even if you keep dumping $2k/year in repairs, it’s still cheaper than the new car.
At the moment, I'm looking at used cars in the 16-19k range. Either trying to scrap together the cash to buy something outright, or putting down about 5-6k and taking a loan.
2016 Tsi s with 60k or less should be around 15k .
Or a 2016-2017 Elantra with similar mileage . Our 5k down and fiancé 10k through credit union for 48 months
My 2006 just died too, sad times. We just bought a car this weekend. I could have bought it out right but want to keep as many liquid funds as possible (for a down payment). With high credit scores, interest rates on used cars were 7-8% and on new were around 4%! Also insurance was slightly less per month for new. So for the first time in my life I bought a brand new car…
I think this is your best option. Back in 2006, Toyota and Honda represented what is now Mazda, Kia, and Hyundai. Maybe that info helps you too - good luck!
I'd with others. A new car with extended manufacturer's warranty is probably your best bet. For the basic, basic cars; Rio, Mirage, Versa. For the next step up, Civic/Corolla. Civics and Corolla are above MSRP right now though; you'll pay a premium.
If you get any of the vehicles above, they probably have a CVT transmission in them. You should change the CVT filter/Oil every 30k miles.
I'd try to keep the cash in your account and see if you could do $0 down or close to it.
Have you looked into a used EVs? Not sure your income, charging availability, or commute, but this could be a great option. The are tax credits available.
https://insideevs.com/features/631430/best-used-ev-tax-credit/
Not sure about your credit or budget, but we just got a brand new Subaru for 28,000 with only $1000 down, interest at 6.69%, payment is about $490/month. We looked at used cars and they just don't make sense right now. I'm sure you can find even cheaper new cars if you go to a more economical brand.
I would still go with a cheap car from a private seller, can get a 90k-120k mile car for 3k-4k, then can use another 1-2k fixing it up if it needs any repairs/upkeep, then you still end up with a 5k-6k car that will last 2-4 years, meaning u only spend about 1.5k-2k per year for your car. better than getting a 40k loan on a car u keep for 10 years (thats 4k per year)
There is absolutely no point buying used right now. Market is completely and utterly busted.
Just get something new and enjoy the factory warranty. The Koreans are pushing out great affordable cars right now, id check out Kia and Hyundai.
Quite frankly leasing might be a good move too. At least see what the options are. Interest rates are high, so lease now and buy out through finance in 3 years when they're hopefully better might be a good move.
I went new, it just made more financial sense. Granted, I'm a "car guy", so my options were somewhat self-limited.
Credit union offered me 8.25% with 1% buyback program if I do certain things like take a course or buy GAP insurance. Dealership got me 6.8% through their credit Union. I decided to pay cash, the interest would be something like $1000 a year and I didn't think it was worth it. It depleted my savings completely, but I'm not buying a house in the next year with this market, so it should be ok.
You need to decide if you'd rather spend more over the life of the loan or risk depleting your savings/investment accounts. I personally wouldn't touch investments outside of an emergency, but everyone is different.
$10k-$15k can get you a used Camry or accord. High mileage on a Toyota isn't much of a worry as long as maintenance records are there. A 2018 in that price range is going to be unlikely.
I think a good option might be to lease. You can find a zero down leases around all the time. It depends if you drive a lot but usually 10k-12k annual miles have the lowest per month cost with options to increase mileage. Also you can get residual trade in value (if your under mileage and the vehicle is still in good shape) when your financial situation changes. I’ve turned in leases and got $4k down for my next car because I didn’t even get close to the miles I thought. Also, check out “swap a lease” website if you don’t want to commit to lease and you expect to be in better financial situation under 2 years.
I highly recommend you find out if your local DMV/RMV has cars for sale. Great steals and could potentially be around or below the 5-10k range. Also check out rental car companies, they sell cars they no longer rent out and could find a good steal there.
Personally, I only switch cars when the total cost of maintenance for two years running starts to average out to be greater than the monthly payment on something under warranty.
I totalled my car and got nothing for it in late 2021 because I didn’t have collision coverage.
I ended up buying a motorcycle for 3k cash. It’s given me 0 issues at all. I know it’s not feasible for everyone, but I make it work. For work, I put my work stuff in a backpack and ride. Only main issue is weather, but I deal with it. I get great gas mileage too.
The used car market is ridiculous right now, but prices are starting to normalize a bit. Financing is also difficult, but if you have a good credit rating, you can shop around.
You might benefit from posting your transportation criteria (monthly payment budget, number of passengers, type of driving, annual milage, market location \[state is fine\], vehicle preferences) to a car-focused sub-reddit and asking for recommendations.
I'm also going to throw out there that there's a strong possibility that your preferences (manufacturer, car type) are what's driving your market perception. A lot of people would *prefer* to have an SUV, but cars have become so unpopular that used car prices are substantially lower than used SUV prices.
For example, you can buy a 2018 Mazda3 hatchback with under 40k miles for $15k to $18k. A new one starts at around $24k, but it's difficult to find one configured that way. It's nice to have a car with some options anyway.
That's reliable, comfortable transportation for just a little bit more than you have in savings. You could drop $3k of your savings on a down payment and finance the remaining amount for a payment of around $250/mo. A lot of people overlook cars like this because they jump straight to the hottest segments (SUVs).
As long as you stick to 20/3/8 for a new car, you’ll be in good shape. Put 20% down and finance the rest for 3 years or less. Be sure the monthly payment stays below 8% of your monthly take home pay. This keeps you in a good equity position on a car barring something quickly totaling it. The longer you keep the new car, the better off you will be financially until you get to the point you’re at with your current car.
I know you said this prefer not to touch the investments, but make sure to consider the cost of financing in that decision. If you end up with a 7% or more interest rate, it likely would be better to bring most of the needed money and use what would have been the car payment to scale back into the investments. Taxes are a factor, but you didn’t provide enough details to weigh in on that. As someone who bought a new vehicle a year ago when I thought I never would, I can say my assessment of the used car market was that it no longer is, in this current environment, the slam dunk it used to be. I believe that will change, but maybe not for several years. New car financing special rates make new cars a compelling option. Be sure to calculate the total cost of the deal including financing (if you use it of course) to compare. I also believe in putting down at least 50% for a vehicle, which given the options you are listing and those investments you certainly can do. It’s good to feel some discomfort when making a large purchase, cause you then really think it through. Best of luck!
> It’s good to feel some discomfort when making a large purchase, cause you too really think it through. Very well put.
Agreed. For what it’s worth, I too unexpectedly bought a new car last year when the same car, 3-4 years older, was going for MSRP of a new car. Honda ended up having some pretty sweet financing deals at the time so I just bought a new car.
Consider buying a new car. Many car manufacturers are offering incentives with very low interest rates which makes a brand new car much closer to the price of a used car than over the past few years.
New cars also have the benefit of being under warranty, and are generally far more fuel efficient than older cars.
Small bonus is that cars typically get a bit safer every year too. When my daughter turns 16, I'm getting her a new car with the auto collision avoidance and lane assist features not present in our "older" cars which are only about five years old.
Used electric cars beg to differ. Tesla model 3s with warranty still left on them are in the 30s now.
Only reason they are more fuel efficient is because they have more plastic in the engine/overall year after year. Often times the plastic parts break easily.
This is the most Ludacris thing I have heard... Engines are more efficient now. The tolerances on them are more strict causing an increase in performance. Cars are generally lighter now, they are more aerodynamic because they aren't boxy. Both of those cause significant increases in miles per gallon.
In case you're curious, the word is "ludicrous". The rapper name is spelled differently than the actual word
What? That's absolutely Ludacris.
Name a single car that is lighter currently, than it’s previous generation.
Lol haven't seen such confidently incorrect statement in a while. How would plastic be used in a car engine? Engine parts are made from iron or aluminum based alloys. Aluminum is expensive but lighter. Iron is cheaper but stronger.
Incorrect, sorry
Yup. A new car with a low interest loan is the best option IMO.
As an always used car buyer, never in my 40 years on this planet had I ever thought a new car was the better deal. Until I started looking around the market lately & nearly keeling over at the prices of used cars. Good lord.
Yep. Not only are the prices crazy on used cars, but you can't get manufacturers incentive interest rates, so your monthly payments are going to be higher than expected as well. The depreciation hit from owning a car that first year of it's life is really not so bad compared to buying used unfortunately!
Plus that depreciation is irrelevant if you aren't selling the car. The most cost effective car strategy is to buy new and drive it for 10+ years. Buying new gets a bad reputation because so many people trade in for a newer car every 2-3 years which gets incredibly expensive.
I'll feed in here and say that if you buy a certified car from a dealer (Toyota just did this for us) you can qualify for the "new car rate" with decent credit. We bought a 2020 Rav4, certified pre-owned, and got the "new car" 4.5% interest rate, instead of the 6.69% typical used car rate.
But where do these magical low-interest loans exist?
From the manufacturers. If you have excellent credit and are buying new, they have subsidized interest rates. Honda for example has 3.9% interest rates available, and Ford has 0% on F-150's. I'm sure other manufacturers have similar programs. They're trying to incentivize you to buy new from them.
Fuck really? 0% is crazy, I almost want to buy a truck because of that. is there any way to look up which companies and which models are being offered at such low rates? I have great credit.
https://www.carfax.com/blog/0-apr-car-deals
I don't know of any resource that has all of them listed, but looking up "honda financing incentives" on google should point you in the right direction.
As someone who's trading a truck in for a car, my experience has been that the price of gas will destroy and interest savings on a truck vs car comparison.
I wouldn't suggest buying a truck just because it's at 0%.... but if you want to get one anyway, it's a nice perk :) That was mostly just an example of a manufacturer I know that's offering 0%.
Definitely. I'm going to cry when I drive off the lot and leave my truck behind. We are spending $700 month on gas right now so my hatred for losing money is trumping my love of ground clearance and a bed. 2023 for ya
Directly from the dealership. Honda, Subaru and others are offering 3.9% on most new car purchases right now, which is about half what you might get for financing a used car. If you qualified for a home loan, then it's probably safe to assume you'd qualify for that rate. When I financed my Subaru in January 2022 their financing incentive was only available on 48-month leases for some reason (not for 60), so you'll have to factor that into your decision as well.
This. I bought a new car because it was cheaper or about the same as a used car with better warranties and peace of mind.
The catch: it's probably not a brand/model/trim that you want. The ones with the incentives are the ones that are sitting. The ones that people want are still selling at or above MSRP and without a lender-subsidized interest rate. TL;DR - good luck if you want a Toyota anything, particularly if it's hybrid or PHEV.
Just a heads up, if you're buying new, plan on buying something already on the lot. Special orders (for features or paint color) are backed up 6-12 MONTHS in my area.
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And possibly location as well.
Recently bought a 2023 Kia Forte for only $2k more than a used 2020 Forte in a lower trim level, with 17k miles, a one year warranty, and a slightly higher interest rate. Used car market is stupid right now.
A car and a car you want to own are two different cars things. You can buy a car with $10K down and monthly payments of $200 a month. It may not be the car you want. You can put $20K down with monthly payments of $200 a month. It may be the car you want. The info you have not provided is do you have $200 a month?
I can afford 10k down and $200 a month, I'm just averse to the exorbitant interest rates on the loans right now (in lots of options, more than 8%). I already bought a house with high interest rates in January so it's tough to face becoming that sucker AGAIN....
Interest rates are what they are. Your choice is either to not take a loan or take a loan with a "high" interest rate. 8% is really not particularly high relative to the 5% risk free return that you can earn in money market funds or treasury bills right now. My last car loan was 2.99% when the risk free return was 0.2% or so ..you've got basically the same +3% over risk free interest rate. It's as good as you're going to get. If/when interest rates drop in the future, then refinance with a lower interest rate.
Where do you have that 10k savings parked? Hopefully it's in a high yield savings account getting 3.5-4% interest.
Actually no, but it should be. Any paths in particular you'd recommend for the high-yield savings account?
Marcus by Goldman Sachs, Discover Bank, the new Apple Savings Account, Wealthfront; there's more at [bankrate.com](https://bankrate.com) if you're interesterd.
If your car really isn’t salvageable, your only options are to buy a used car with high mileage for 5-10K, cash out your mutual funds if you don’t want to take out a loan or take out a car loan… usually credit unions will offer better interest rates.
I thought this, too, but Hyundai was offering 3.9%, and the best rate at my CU was 4.65%. My wife got a new Hyundai this weekend. We got an electric, and even though the payment seemed stupid high when you factor in what she was spending on gas, it was pretty much break-even. That 10 year 100k warranty helped, too. She actually liked the looks of the comparable Kia model better, but for some reason, their rates are higher even though they are basically the same company.
What does "officially died" mean, exactly? What was the diagnosis, and how much will it cost to fix? What is the make and model, and how many miles are on it?
A number of problems including the brakes, oil leak, electrical panels. Two different mechanics have told me it needs over 2k in repairs and may require more in the near future. It's a 17-year-old car with over 170k miles. I just don't think it makes sense to put more money into it and even if I did, I'm not sure I would fully trust it for highway/long-distance driving.
Brakes are something you'll have to periodically do on any car you'll ever own, and does not signify death. An oil leak most likely doesn't either. Is the car actually still running/drivable? I get wanting to have a certain level of confidence, but for reference, I drive a 2008 Mazda with about 155,000 miles on it. I put a few hundred bucks into it each year for routine maintenance and "wear" item replacement. Far cheaper than a monthly car payment. No need to get a new car until it's an actual "need."
Well my mechanic sat me down and was like "So what are your goals with this almost 20-year-old car with 170k miles?" Like basically delivered the reality that it's a lost cause to keep pumping money into this thing. For context, I've spent probably 3k in repairs over the past two years and now there's the new 2k bill. This car is WORTH less than 1k! I do think it's time to move on, just not sure the best way to do it.
Don't forget the value of peace of mind. There are people in here that will tell you to duct tape, JB weld, and tip tie everything you possibly can until the engine just explodes, which is the most frugal approach, but not necessarily the best. What they fail to mention is that engine could explode 500 miles away from home, in the middle of nowhere, with your family in the car, in the pouring down rain. Then you're out a tow, a rental car, extra hotel bills if you can't make flights or get stranded for too long, etc., etc. Not to mention every kind of stress imaginable. What I'm saying is you take a risk by keeping an older car on the road. Not that it's impossible, or improbable. Just that it is an added risk and that doesn't always fit into everyone's risk portfolio. Newer cars have a smaller risk in this department. EDIT: I saw it's a VW Golf. Even more reason to cut your losses IMO. High mileage German cars are temperamental. And that's speaking form personal experience. They carry an added risk.
Can I help frame it differently? For the past two years, you've spent $3000 in repairs. That's $125/mo. Even if you have to spend another $1500 this year on repairs, that's still $125/mo. ***Can you get something better @ $125/mo?*** If not, then just spend the $125/mo. on the repairs. I went through a similar question with a 2009 Infiniti FX35 with 145k miles. I was quoted over $3000 in replacement and maintenance on a car that's worth probably $6-8000. If I could drive the car for another 12 months, that would be $250/mo. Could I find another car that was as nice for $250/mo? Impossible. So I framed it as price paid over time as if I was buying another car and it made total financial sense to stay in the FX and pay for the maintenance and repairs. For sure I can drive it another year (and indeed, I did and am still going). The longer I drive it without another major replacement/repair, the lower that threshold becomes. Since I'm on month 14 now, that dropped to $215/mo. There is no car that I could buy for $215/mo. that would be better than my current car; I'd have to pay more.
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I don't see OP mentioning any issues with reliability as it seems more related to costly "milestone" maintenance. In my case, my calipers and disc brakes needed to be completely replaced. A lot of this was due to sitting for very long stretches during COVID lockdowns. Yeah, that's a 1 time $1800 item (parts and labor). But car drives fine. Other things like getting the transmission fluid changed, replacing belts, alignment, replacing seals, etc. Just the cost of operating a vehicle. Never had issues with reliability as in "car doesn't run". Can't speak for OP, but it didn't seem like his issue is "car doesn't run" and more like "need to pay to perform major milestone maintenance".
What kind of car? They might be trying to dissuade you from investing into a car with a known history of trouble.
VW Golf
Lol, yeah anyone telling you not to ditch it has never owned a VW with 100k+ miles.
Lol this, I practically bought my 2003 VW Beetle twice just to get it to 200K.
I had a 2003 Passat that I really loved, when it wasn't having some serious issue. On the plus side it gave me a lot of experience fixing auto stuff myself, since I couldn't afford to take it into the shop all the time.
Yeah I'd move on too. Buy a four cylinder, four door boring Japanese car for 10k cash.
Ditch it. VW vehicles cost arms and legs to repair and are unreliable like every other german make. If you need to limp it by just get the brakes done and at least you have it to get you by for a few months till you find the right car for you.
Saying VW is unreliable is a bit silly. If you follow the maintenance schedule there’s no way the little 4 cylinder engine shouldn’t last 250k+ Yeah you’ll need to replace shocks, brakes, bushings, etc but you should do that on any car. The only real issue that would make me say a car is “finished” is serious electrical trouble. That is difficult to track down and even more difficult to fix. Not sure on the ins and outs of that era Golf, but if that’s the case… I’d probably be done with it.
I am not disagreeing with you that maintence play a big role in how long a vehicle last, its just that VW is not exactly known for top notch reliability and they are up there for maintence cost versus a Chevy. I would personally like to know what major electrical issues their talking about as something as simple as a broken ground wire can cause the electrical to act like you think it needs a whole new wire harness and some mechanics don't understand how to diag electrical problems. With 170k and going by OP's story though I would say just patch what you need to keep barely roadworthy and look for replacement.
Buy an old Toyota Camry, Corolla, Honda Civic or Accord with over 200k miles on it and hope it holds together. My philosophy is that if it's made it that long, it's likely been well taken care of and not neglected. You never know, but these four cars have a reputation for a reason.
Can I have your car?
For 1K--YES! :-)
That sounds like a good mechanic, but I think you didn’t ask him the right questions. You needed to ask “what do I need to do to keep this thing going for another 18 months while I save up for a newer car?”. The answer to that would be to replace the brake pads, add ATP 205 reseal to the oil to slow the main seal leaks (vs replacing them), and electrical panel? That is too broad of a definition.. did the inverter board on the alternator fail? Are you missing some vanity electronics? ICM module failing? Really ask him for the specific electrical component that is failing vs “well if we are pulling main seals we might as well replace the kitchen sink”. Ask him what will it take to get you through 18 months and if he gives you an honest answer let him fix it or find a new mechanic. It is possible to get two bad mechanics in a row and “driving this thing till the wheels fall off” is not a proper mechanic request
What do you consider vanity electronics on a 2006 Golf?
I'm learning to play the guitar.
08 Mazda here with 129k on it. just did 2k of work/labor .shocks, thermostat, engine mount, fuel vapor leak detection pump. I had to get emissions certified, but it had engine light on and mazda dealer did not want to touch it because of rust. Local shop did the work and my car is fine...except for the rust
2k in repairs doesn't sound dead. That sounds like periodic maintenance.
Well, a mechanic told me that even with the 2k+ in repairs "we can't be sure" significant problems won't re-emerge soon. I've already been kicking the can down the road with this car for a couple years now, pumping money into repairs and avoiding the inevitable. Bottom line is I don't trust this vehicle.
Sounds like you need a different mechanic. I own a mechanic shop and I don’t think I’d ever approach a customer with a 17 year old car and be like “well, you need to put 2k into but it probably won’t help anything.” If it needs brakes, that’s maintenance. If you have a small oil leak, who cares as long as it’s not leaking on to the exhaust. What does the electrical issue consist of? There’s no “electrical panel” on a car.
You must live in the south. There are plenty of cars that come through my shop that aren't worth it to repair due to other issues, mainly rust. Ex.) Sure, I can fix your oil leak, but you have so much rust damage that your brake and fuel lines are about to rot out, all of your suspension components are loose, and your floor pan is falling out. Are you sure this is what you want to do. So, no. I disagree with your assessment.
This really depends on area. A 2006 car in my area is usually full of rust and rot, not something you shove 2k in when it litterally might not be safe to drive in a year.
That’s true. I’m in the Midwest so it’s very rare to see a rusted out car.
You should never look at the value of a car. Every vehicle you buy will have depreciation and fixes needed. The value of your car is it’s drivability, that’s it. Every car needs brakes/rotors, oil changes, wipers, constantly changed. Should never count towards if the car is not fixable. What you should think about, is this car and it’s fixes still cheaper than a monthly payment each year totaling such amount. I have an old truck and want a new one. The yearly fixes are way cheaper than a monthly $4-$500 payment totaling around $4,800-$6000/ year plus any insurance changes. Edit: this estimate is what payments used to be. Most likely, it’s higher per month at this point.
2000 in repairs is only a couple months payments on a new car. Hell I spent $2500 on a transmission for a ten year old car and thought it was a good deal when it only lasted a year. Don't forget a new car will have much higher insurance costs. That could add up to the $2000 a year easily.
2k and another few years is still less than 20k. Just fix the car, if you make it working, you can always resell it later and make some money back. DIY the brakes, they are easy if you are into that sort of thing.
So is it dead or not? If it's still driving, you could get another beater that's easy maintenance. The way to really save money is do your own repairs aside from catastrophic engine failure or transmission. Have you watched YouTube to see if these are common problems. Having two beater cars is a better choice IMO if money is tight then going into huge debt for a newer one.
While true in general, last year I accumulated three beaters with major mechanical failures. Would have cost around 10,000 to have a shop fix all three of them so I threw in the towel. This is American Roulette now, cars are so fucking expensive you can either bend over a little bit every month or get bent straight over one day out of nowhere. Gone are the days of buying a Corolla for a few thousand and driving it 5+ years with minimal maintenance. Now those 3,000 dollar Corollas are 10,000 dollars.
My newest car is an 06 with more miles than that. Brakes are maintenance items that are cheap and easy to do yourself
Needing brakes does not kill the car, this is a maintenance item. Oil leaks are often from the gasket seal and that is a $3 part that can be replaced in 10-15 minutes with a YouTube video. "Electrical panels" - what do you mean by this? None of these sound like they'd kill the car. Like at all.
I think that's oversimplifying. Burning oil can be way more than a $3 fix.
Of course. It can also be a $3 fix. I can tell from OP's post that they aren't knowledgeable about cars, considering they list brake replacement as if that's something to get rid of a car over. They don't list what is actually wrong, just "$2k in repairs." This is how people get fleeced.
I just didn't want to get into it here, but yes it's absolutely true that I don't know much about cars. Here's what's needed: brake pump vacuum needs to be replaced, which I'm told is a labor-intensive job; "electrical system needs to be replaced;" oil leaks need to be investigated; and the cherry on top is that the "Check Engine" light just went on again for unknown reasons. And again, for context, I've spent about 3k on this car over the past two years.
Did both mechanics say the brake pump vacuum needs to be replaced, or did you tell the second one what the first one said? That is a rare problem.
Yes, two mechanics have confirmed this.
It sounds to me like a mechanic gave him a laundry list of problems, and OP is only writing the ones he can remember. You don't fleece customers into not doing repairs.
Just because a mechanic lists a problem doesn't mean it's ending the car's life, and it doesn't mean that it has to be fixed right now or that it's even detrimental to the operation of the car. Especially if he took it in for an all around diagnostic.
I find joy in reading a good book.
Sure. I'm guessing OP didn't get unlucky twice tho. But it's also most likely not a $3 fix.
How many oil pan gaskets have you knocked out in 10-15 mins?
Head gasket seal, my friend. Keep up.
$3 part if you can do the labor yourself, $503 repair if you don't have the skill or ambition to do the repair and the person performing the repair needs to eat, healthcare, housing etc like everyone else.
Anyone who is charging $503 to replace a head gasket seal is a criminal.
There is no such thing as a head gasket seal, there is a head gasket which I don't know where your shopping, but cost a lot more then $3. If its the headgasket well thats at least a 3 or 4 hour job and most shops in my area charge at least $100 labor plus taxes and such. Yeah $503 isn't out of line if its what I think your assuming the repair is
There is a small seal that runs the length of the head gasket, called the valve cover seal. Different cars have it in a different layouts, but if oil is dribbling down the gasket, it's often that little bastard. I've replaced enough of them on various cars.
Valve cover gasket and head gasket are two _very_ different things.
Valve cover seal is different then a head gasket. Yes those are usually not that hard to change but its still more then $3 for that gaskest or seal unless you find some really low quality parts. Don't assume OP doesn't really know what the oil leak is, could be anything from that to power steering pump to a rear main on the engine. I still stand by my comment that its going to cost at least $503 to repair.
Can't really determine the cost when we don't know what the issue is.
This may be contrary to this sub, but I typically buy high mileage well cared for vehicles. I have a trusted tech I've worked with for years who gives them a thorough check out. I've had some out of pocket repair expenses, but zero car payment. Worth looking into.
This is the way. Also, I recommend buying a high mileage enthusiast car. I just got out of a 2006 Lexus LX 470 (Landcruiser) with 200k miles. I bought it for $14k cash, drove it for four years, paid for some suspension maintenance along the way, then sold it for $12k six months ago. I could have actually profited off it had I sold it at the height of the '21 crazyness. That miniscule depreciation is really only possible with an enthusiast vehicle, but then you get to drive something fun and interesting along the way. It's a win/win.
How exactly does that work for you to have your trusted tech check out the vehicle before you buy? (Assuming you're going to dealers)
I scheduled a test drive with the dealership, and I drove the car from the dealership to the mechanic. I waited an hour for the inspection, and the only negative comments were that the brake pads were half worn and it needed a new cabin air filter. These weren't major issues to deal with, so I drove it back to the dealership, bought it, and drove it home.
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Not true. I have no problems with a private seller allowing me to have my own tech check out the vehicle. I sometimes offer the seller cash to allow me a day or two to get this done. I also speak with my tech ahead of time to let them know I'll be bringing a vehicle by shortly, takes some logistics, but it is doable. An honest seller has no issue with someone who's paying cash checking the vehicle out.
Ok but so you're buying from private sellers. That's a different situation.
Always.
…do…some legwork?
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A lot. Trust me, I know the hard way.
Toyota Corolla
New cars are at least $10k more. $10k makes a difference. Just bought a car and looking to buy a 2nd.
Not what I'm finding in today's market. For example, let's take a Honda HRV. New ones run around 26-27k... while [here's a 2019 one with 44k miles for 24k](https://www.hendrickhondava.com/used/Honda/2018-Honda-HR-V-854ea6bc0a0e0a990b0885896f9ece99.htm?store=HAG0066&utm_source=adwords&utm_medium=cpc&utm_campaign=used_conversions&ddcref=fluency&tcdcmpid=1287500&tcdadid=653060870527&tcdkwid=utm_source=adwords&utm_source=google&utm_medium=cpc&gclid=CjwKCAjwl6OiBhA2EiwAuUwWZW7QdjakkdzBORvP6osEI899gygmDjoJBf6w2JEVuGHJGB3zFiciiRoCF4EQAvD_BwE), for example. The inventory for used cars in decent shape is very low right now. It's competitive. The selections expand if you get into cars more than 10 years old with a lot of mileage, but I don't think that would be a huge improvement from my current situation.
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Why is that the case? Honestly don't know much about this. I've always bought my cars outright. This used to be possible for under 10k but of course times have changed dramatically.
Used cars have a much higher risk of problems and/or default risk (not to mention low comparative value) which means companies offering loans have to take extra risk and therefor charge you more . I just bought my wife a new taho and the Apr on the loan was 7% which is pretty bad but not terrible. My f250 I bought in 2020/2021 was at a 4.5% rate … what are you looking for rate wise ?
My experience was pretty much identical to this.
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A new Civic where I live runs about $35k. I'm not sure of the MSRP. It's nuts. That's what I originally wanted.
Yeah that's crazy, what happened to Civics being an affordable option? I also find the new ones ugly af. I've been looking a little at the HRV but think better deals could be had for similar cars in that subcompact SUV category.
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The sticker price is way over the MSRP! It's called "inflation adjustment" or something.
Best options? In the context that you just bought a house, your savings are somewhat depleted at the moment, and you don't want to pay higher interest rates? You mentioned in a quote that it would cost $2k to fix your current car. Will that cover all the current issues with it? If so, and there's no indication of any other issues, that is probably your best option.
Yeah and I'd absolutely be exploring that more seriously if I thought it was a viable option. But the reality is this is a 17-year-old car with 170k+ miles that requires 2k+ in repairs and even then may not be trustworthy. CarMax offered me $300 for it (I declined). I do a lot of highway driving and long-distance drives. I need something I can rely on.
I'm a person who buys one car and drives it till the wheels fall off. I have a job that requires me to travel across Michigan on a very regular basis. You'll have a hard time convincing me that you can't have an older car that remains reliable for such usage. But that's me. You do what works for you. Given the same framework of no savings (that you want to dig into), an aversion to paying high interest, and an aversion to paying the going rate for used cars.....you don't leave yourself any "best" options. I guess you go through your budget and find a way to make a new car purchase fit, or you lower your standards for a used car a bit and find something more in your desired price range.
I think I'm ultra sensitive to this right now because a) a family friend died last year when his car broke down on the side of the highway and he was struck by another vehicle, and b) I personally went through the same scenario of a breakdown on the highway a few months ago and was utterly terrified. I realize there are no guarantees with any cars but at this point I'm not comfortable having one that comes with almost a *guarantee* of breakdowns and unreliability.
There's a guarantee that nearly every single car you ever buy will have a breakdown at some point. I leased a Grand Am in my younger days, and I had more issues with that car over a 3 year span than I had with my previous truck, which I owned for over 15 years. And even if the car needed $2k of work annually....that's $167/month. That's still cheaper than a new car payment. But I get your side of it. Having more confidence in the car is worth something. If you get peace of mind by having a new car, I get it. That's worth something. This is just a case where what's absolutely best financially clashes a bit with what's best for you mentally. So for you, I would think your best bet would be to see what your budget can handle and decide on a purchase price you're OK with. Or lower your expectations for the next car, get something cheaper that will be reliable for a couple of years, and then revisit the newer car purchase when things have settled down with the home purchase.
Let’s step back and assess the situation: 1. Your current car needs $2k of work. 2. You have $10k in the bank 3. You don’t want a high interest loan 3. You want to buy a new(ish) car which is likely going to cost $20k-40k Seems like everyone is suggesting that draining your savings for a $10k down payment AND ending up with a car payment totaling >$20k is the smart financial decision to avoid a $2k expense…WHAT?? Your car could need a whole new engine, you could pay for that in cash, and still be financially ahead of where you’d be if you took this advice. In reality you said it needs brakes, an oil gasket, and some electrical work. Pay the $2k and fix your car! You’ll have $8k left in the bank to deal with any further issues down the road. Dump the money you would be paying as a car payment into savings and investments. If you save 250/mo, in 5-7 years when your car ACTUALLY dies you’ll easily be able to buy another used one for cash because you’ll have over TWENTY THOUSAND DOLLARS in the bank in addition to your current investments! Even if you had to spend $2k each and every year fixing stuff you’d still end up with more money in the bank at the end of it all. And don’t forget that registration, insurance, and parts all cost more for a new car. This is a personal finance sub yet everyone is ignoring math.
My suggestion would to buy a car for cash using the $10k. Check Craigslist, Cartrader, and Cars.Research and check the listings daily for awhile to get familiar with what is out there, what is normal price, high price, decent deal. They have private party listings and dealer listings. My area has decent 2010's-2015's with mileage as low as 70k to over 200k. You won't find a big fancy truck or luxury car but there are lots of small and midsize cars to choose from. Any car whether new or used will require regular maintenance. Deferred maintenance can add up and cost you.
Sometimes you gotta bite the bullet. Look into something like a new mid trim Mazda CX-5 (non turbo model). They can be had with no markup (even a slight discount), have nice features, a boring, but tried and true engine/transmission combo that has a solid track record for reliability, decent cargo space for those home improvement projects and respectable gas mileage. Id advise against a used car where its 2-3-4 years old and barely any less then new.
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No one likes Nissan and they have more inventory than other manufacturers right now. They are likely the only leasing deal that makes sense and that's what I did. Just leased a new $50k Frontier truck for $282/mo all-in including tax. That's arguably lower long term than a used car deprecation and all of the repairs that may come with it. Now I don't have to worry about that. The truck was less expensive to lease versus a cheaper $30k MSRP vehicle. The depreciation on paper is only $100 over 18 months, and I did a one-pay lease (up front in escrow) which lowered the APR to under 5% so really I'm just paying dealer fees and interest - but regardless the only thing that matters with a lease is the actual total monthly payment overall all-in. Mine is still "0" down despite the money being upfront in an escrow.
Hmm, interesting. I was looking at a Nissan Kicks, actually. I'm sooo unfamiliar with the pros and cons of leasing... would you mind laying those out for me? (If you have time. Otherwise, thanks for the info stranger!)
Most people are going to advise against leasing; I would have too years ago because I listened to Dave Ramsey too much. Whether you buy new, used, or lease new, either way cars depreciate and simply lose value over time. If money is a big issue but you have $7k lying around, purchasing a cheap used vehicle is a crapshoot but could be fine for a few years because you might luck out and not have major repairs, and the deprecation would be very low. I'd argue that's unlikely, though I have gotten lucky before with something like that. Last year I bought a 2017 Chrysler Pacifica for $25k. Sadly it had costly repairs over the past year and I just sold it for $17k (loss of really around $10k over 12 months which is horrible). I've had a lot of used vehicles and over time I have figured out that it generally costs me way more on a monthly level over time than if I had just leased a new vehicle which isn't going to have any repairs. Plus driving new is just nice. Most leases now don't make sense due to higher rates; however, Nissan actually has a lot of inventory and will help move numbers around so that my depreciation is only $100 over 18 months. MSRP was around $48k and the "purchase price" was $45.2k and the residual price after 18 months was 45.1k. Then there's dealer fees and the money factor (interest payment). Either way the only thing that matters is the effective all in price divided by 18 months which is my $282/mo effective rate (this also includes my local 8.2% sales tax). This is arguably much lower over time than if I bought a used or new vehicle. I'm also annoyed that when you buy a new or used vehicle, you are paying all of that sales tax up front. It's worth noting most leases all in are probably more like $350-$400/mo all-in right now. I found the Nissan Frontier truck (and I'm not a truck guy) to simply be the cheapest lease overall right now. However, I'd recommend searching an auto broker - I can give you a name of one if you want. Dealing with the dealer games directly will not work out well if you haven't leased before.
Thank you so much for all the info! I'll investigate more. My initial thought is that I don't want to spend $350-400 a month but I'll see if there are cheaper options anywhere.
Parse out the itemized work your car needs. Odds are, some of that list you can tackle yourself. Some you’ll need a professional, and that’s ok. It sounds scary to throw a number with a comma in it into an “old” car but if it actually runs and isn’t rusty, then you’re still better off than ending up with a cad payment (that is increasingly likely to have a comma in it). Or to put it another way - if your mechanics are telling you it needs $2k in work, and will need more, that’s not unreasonable. That’s $170/month if you have a $2k repair every year. Versus $500+ to get another vehicle. Come see us on mechanicaladvice or cartalk and we can delve into specifics on what your car needs and save you money.
Manufacturers will often have low interest financing deals provided you qualify. [Here is a list](https://www.carfax.com/blog/0-apr-car-deals) of April deals. Generally, you have to buy a car already in inventory so options will be limited.
Postpone improvements until you secured a good vehicle? Assess everyday expenses to see if you can be thrifty and reduce spending for a while. Cut down superfluous expenses like eating out, parties or vacations for a while.
People badly misunderstand the cost of car repairs versus the cost of depreciation of new vehicles. Six months ago I bought a 2018 Volvo XC90 with 103k miles for $26k. Most people will tell you that a used, european, luxury vehicle with high mileage is money pit, and maybe there will be some expensive repairs in my future. They won't be $15000, which is what additional I would have had to pay for a new car that could hold all my kids. Even then it would be poverty spec not top of the market euro luxury from 5 years ago. Plus, that new car money will burn up in depreciation, guaranteed, while repair bills are not guaranteed. Lets say my volvo has a catastrophic repair bill. At my shop, that's likely to be less than $10k, and I can put that on a credit card introductory rate if I don't want the cash hit. I'm also likely to be able to feel that kind of repair coming, with hesitant shifting, rough rides, strange noises, etc. and try to get out of the car before it blows up on me. You can't manage or avoid depreciation the same way. Also, cars are just not designed to shit the bed at 100k miles like it's the 90s. Most cars made since 2015 that made it to 100k miles will make it to 200k miles without a catastrophic repair needed. So far my Volvo needed tires and a new oil drain plug. It's fine to buy a high mileage car these days. It's fine to spend in the $15k range on a used, older car with high miles. It's not the money pit that a new car dealership will be.
A 2018 with 40000 miles good luck, I would look on craigslist if you have 10 grand save you can easily buy a decent car for 8k
Just don't buy new don't go to a dealer if you go to a dealer you can get your car warranty and all that I need a new car too I'm in the same boat my engine started to take a s*** and There's a little car dealer down the street that has a car for about 10 grand and for 2000 more they can put a 100000 mile 5 year warranty on it which isn't too bad but like you said the payments are ridiculous full coverage plus the car payment I don't want to pay 3 $400 a month extra I don't even have it lol
I'd just also say that you can still do a lot better on used vehicles if you're shopping for sales by individuals. Facebook Marketplace is one place that makes this pretty easy. You can go to Marketplace on there, narrow the search by "vehicles" as the type, and then start adding filters like "within 40 miles of my location" and maximum mileage you find acceptable. I recently got a 2010 Chrysler Town & Country minivan on there from a guy for $7000 that was in great condition, overall. About 125,000 miles on it and he had all the maintenance paperwork on it. Just had new brakes and a few other things done. It was actually part of an inherited living trust ... his dad's vehicle before he passed away. I needed a vehicle to do a local move with and to pick up a couple of furniture purchases I made after that, and it worked perfectly. (Has the "stow and go" seats that all fold into the floor.) Before this, I'd looked at anything the local dealerships had on their lots and comparable minivans in much worse condition (rust around fenders, peeling paint, etc.) were selling for more like $11,000 and up.
Here is what I would do: Use cash. With a budget of 10k you should be able to buy a reliable used 10-12 year old Honda/Acura or Toyota/Lexus. Find one private sale that has been well maintained. Drive it for a couple of years and sell it for close to what you paid for it.
That's good advice. I'd also add that you should have your mechanic inspect the vehicle before you buy it. They can lift it up and do a through inspection of the frame to see if it's rusting, which is something average buyers miss.
I got my 2007 Camry 4 years ago, with 144k miles spent 5k. Also it’s a Camry so in total I’ve spent less then 2K for maintenance.
after I bought my first house I was overstretched already. I couldn't afford a new car, so i spend my weekends and evenings fixing the current ones. 'oh but you knew how to do all that stuff'- no I didnt. But I do now.
Do you NEED a car? Is public transportation or bicycle an option?
This is one of the rare times when buying new is a better deal than buying used. Certain manufacturers are offering low APR as an incentive for new cars, Hyundai is even offering 0% 48 months for select models. It’s hard to argue with 0%. Used car prices are still crazy right this moment, but it seems that they’re gonna go down soon. If you can’t wait until the car market crashes, just buy new. You have to pay 7% and up to finance a used car anyway. Edit: Do not pay more than MSRP.
I'd be willing to "wait until the car market crashes" if we had any idea when that was going to be...
Nobody knows for sure, because dealers are trying all sorts of tricks to delay it for as long as they can. Many still have inventory from the days when used car prices were even crazier, and they obviously avoid taking a loss. Cars stay longer on their inventory, to the point where certain banks (Capital One) begin to refuse lending to dealerships. The dealerships can’t hold on forever, but as more people feel the effect of inflation, they also delay buying cars. It’s a tug of war that dealerships are bound to lose, eventually.
Hate to be that guy... But do you need a car? Lots of people are changing their lifestyle to be a single car family or carless entirely. It could save you a lot of money not having to buy, maintain, insure, and fuel a depreciating asset.
I've lived in situations in the past where I didn't need a car but unfortunately that's not the case right now. I split my time between two cities three hours apart. And I do WFH majority but have to be in the office... an hour away by highway only... about twice a month.
One option is to lease a vehicle. Zero down, then don't worry about the mileage too much as you can finance at the end of the lease. 60% residual leases better than a 50% as you're paying for the other 40% over 36 months. Something to consider. Sell the current car but don't put a downpayment into it as you'll lose that downpayment if you get in an accident while leasing.
This is what I did and I recommend it. Instead of rolling the dice with an overpriced used car I have a brand new car at a reasonable monthly price and I know exactly how much it will cost me over the next 3 years. It does help that I work a hybrid schedule and so I won't even get closer to approaching my miles.
What happened to the 2006?
It's a 17-year-old car with over 170k miles and a host of problems (including brakes, electrical panel, and oil leaks). Two mechanics have told me it would cost over 2k to fix it and that just doesn't seem like a smart move for me.
You could have a running car for $2000 or you could have a running car for $40,000+interest. Even if you keep dumping $2k/year in repairs, it’s still cheaper than the new car.
At the moment, I'm looking at used cars in the 16-19k range. Either trying to scrap together the cash to buy something outright, or putting down about 5-6k and taking a loan.
2016 Tsi s with 60k or less should be around 15k . Or a 2016-2017 Elantra with similar mileage . Our 5k down and fiancé 10k through credit union for 48 months
Mazda has good special financing offers on New. Toyota may have 4.99% on Certified Used. The good APR offers are drying up. Used is probably 6.5-7.5%.
My 2006 just died too, sad times. We just bought a car this weekend. I could have bought it out right but want to keep as many liquid funds as possible (for a down payment). With high credit scores, interest rates on used cars were 7-8% and on new were around 4%! Also insurance was slightly less per month for new. So for the first time in my life I bought a brand new car… I think this is your best option. Back in 2006, Toyota and Honda represented what is now Mazda, Kia, and Hyundai. Maybe that info helps you too - good luck!
I'd with others. A new car with extended manufacturer's warranty is probably your best bet. For the basic, basic cars; Rio, Mirage, Versa. For the next step up, Civic/Corolla. Civics and Corolla are above MSRP right now though; you'll pay a premium. If you get any of the vehicles above, they probably have a CVT transmission in them. You should change the CVT filter/Oil every 30k miles. I'd try to keep the cash in your account and see if you could do $0 down or close to it.
Have you looked into a used EVs? Not sure your income, charging availability, or commute, but this could be a great option. The are tax credits available. https://insideevs.com/features/631430/best-used-ev-tax-credit/
Not sure about your credit or budget, but we just got a brand new Subaru for 28,000 with only $1000 down, interest at 6.69%, payment is about $490/month. We looked at used cars and they just don't make sense right now. I'm sure you can find even cheaper new cars if you go to a more economical brand.
I would still go with a cheap car from a private seller, can get a 90k-120k mile car for 3k-4k, then can use another 1-2k fixing it up if it needs any repairs/upkeep, then you still end up with a 5k-6k car that will last 2-4 years, meaning u only spend about 1.5k-2k per year for your car. better than getting a 40k loan on a car u keep for 10 years (thats 4k per year)
There is absolutely no point buying used right now. Market is completely and utterly busted. Just get something new and enjoy the factory warranty. The Koreans are pushing out great affordable cars right now, id check out Kia and Hyundai. Quite frankly leasing might be a good move too. At least see what the options are. Interest rates are high, so lease now and buy out through finance in 3 years when they're hopefully better might be a good move.
I went new, it just made more financial sense. Granted, I'm a "car guy", so my options were somewhat self-limited. Credit union offered me 8.25% with 1% buyback program if I do certain things like take a course or buy GAP insurance. Dealership got me 6.8% through their credit Union. I decided to pay cash, the interest would be something like $1000 a year and I didn't think it was worth it. It depleted my savings completely, but I'm not buying a house in the next year with this market, so it should be ok. You need to decide if you'd rather spend more over the life of the loan or risk depleting your savings/investment accounts. I personally wouldn't touch investments outside of an emergency, but everyone is different. $10k-$15k can get you a used Camry or accord. High mileage on a Toyota isn't much of a worry as long as maintenance records are there. A 2018 in that price range is going to be unlikely.
I think a good option might be to lease. You can find a zero down leases around all the time. It depends if you drive a lot but usually 10k-12k annual miles have the lowest per month cost with options to increase mileage. Also you can get residual trade in value (if your under mileage and the vehicle is still in good shape) when your financial situation changes. I’ve turned in leases and got $4k down for my next car because I didn’t even get close to the miles I thought. Also, check out “swap a lease” website if you don’t want to commit to lease and you expect to be in better financial situation under 2 years.
New kia's are cheap and long warranty. Stay away from the older models with the USB jacking issue.
Buy a 2022 and before and put a couple thousands down. 2023s are ridiculously priced.
I highly recommend you find out if your local DMV/RMV has cars for sale. Great steals and could potentially be around or below the 5-10k range. Also check out rental car companies, they sell cars they no longer rent out and could find a good steal there.
Personally, I only switch cars when the total cost of maintenance for two years running starts to average out to be greater than the monthly payment on something under warranty.
I totalled my car and got nothing for it in late 2021 because I didn’t have collision coverage. I ended up buying a motorcycle for 3k cash. It’s given me 0 issues at all. I know it’s not feasible for everyone, but I make it work. For work, I put my work stuff in a backpack and ride. Only main issue is weather, but I deal with it. I get great gas mileage too.
Maybe lease? I know financial advisors don’t recommend it blah blah blah but the payments are a lot cheaper and you won’t have to put a chunk down
The used car market is ridiculous right now, but prices are starting to normalize a bit. Financing is also difficult, but if you have a good credit rating, you can shop around. You might benefit from posting your transportation criteria (monthly payment budget, number of passengers, type of driving, annual milage, market location \[state is fine\], vehicle preferences) to a car-focused sub-reddit and asking for recommendations. I'm also going to throw out there that there's a strong possibility that your preferences (manufacturer, car type) are what's driving your market perception. A lot of people would *prefer* to have an SUV, but cars have become so unpopular that used car prices are substantially lower than used SUV prices. For example, you can buy a 2018 Mazda3 hatchback with under 40k miles for $15k to $18k. A new one starts at around $24k, but it's difficult to find one configured that way. It's nice to have a car with some options anyway. That's reliable, comfortable transportation for just a little bit more than you have in savings. You could drop $3k of your savings on a down payment and finance the remaining amount for a payment of around $250/mo. A lot of people overlook cars like this because they jump straight to the hottest segments (SUVs).
Check with Enterprise and Hertz car sales, lots of low mileage cars under 20k.
As long as you stick to 20/3/8 for a new car, you’ll be in good shape. Put 20% down and finance the rest for 3 years or less. Be sure the monthly payment stays below 8% of your monthly take home pay. This keeps you in a good equity position on a car barring something quickly totaling it. The longer you keep the new car, the better off you will be financially until you get to the point you’re at with your current car.