Used car buying advice

[adamb100]

I got my license a few months ago and I am approaching my budget for a car (around $6,000). I've started looking at cars online, mostly either Hondas or Toyotas since I hear they are built like tanks and cheap to maintain. I'm a little skeptical of using Craigslist for such a large purchase so I've mostly stuck to autotrader, car gurus, and cars.com. Is there anything I should look out for or any tips for buying my first car?

[LouisEly]

Don't be afraid of CarMax - they have a decent no-lemon policy/warranty and you won't have an inflated price you have to haggle over. They have a lot to lose as far as their reputation if they sell bad cars. Don't be afraid of American cars either. There have been as many if not more recalls on Toyotas than GM, Ford, or Chrysler the last few years. I've had eight American cars in the last 15 years (most of them company cars) and have not had an issue with anything that affected the drivability of the car - the only issue I ever had was one car had an electrical problem that would randomly pop the trunk or set off the alarm. Almost all were driven to 60K miles or more.

 

Also check the car rental company (Hertz, Enterprize, etc.) sales. See what type of warranties they offer on their cars.

[nate82]

The best advice I can give you is to have a mechanic look at the car before you buy it.

 

http://www.kbb.com/car-reviews-and-news/top-10/best-used-cars-under-8000-2014/

[owbc]

I got my license a few months ago and I am approaching my budget for a car (around $6,000). I've started looking at cars online, mostly either Hondas or Toyotas since I hear they are built like tanks and cheap to maintain. I'm a little skeptical of using Craigslist for such a large purchase so I've mostly stuck to autotrader, car gurus, and cars.com. Is there anything I should look out for or any tips for buying my first car?

 

I was in your situation about 6 years ago making my first car purchase. Ended up purchasing a $5,000 Corolla with 120K miles off Craigslist. Later sold it to my brother-in-law but it's still running today. I watched a few Youtube videos on evaluating used cars so I knew what to look for (basic stuff like checking tire wear, oil, shocks, A/C, etc). Make sure you bring someone else with you and be very skeptical of anything that looks fishy. There are plenty of cars out there, so if something doesn't seem right, get out of there. The owner should also be comfortable with letting you take the car for a test drive and to a mechanic if you think you want to make a purchase. A legitimate owner should also have records of the previous maintenance. Most shops will do an inspection for less than $100--and this gives you some leverage in negotiating since they will give you an estimate of needed repairs.

 

Also, don't underestimate the other costs associated with the car. Insurance is expensive. There's also going to be repair bills--I've loved my Toyotas but inevitably a car with 100K+ miles is going to have a few $500-$1000 repairs. Keep putting money into your car fund after you purchase the car so you can afford a repair when it pops up.

 

Since you have $6K saved up, another option is to finance a nicer used car. You might want to check out a credit union and see if you can get approved for a loan. Dealerships have a large stock of relatively new cars for under $15K which might be a better deal in the long run.

[adamb100]

I got my license a few months ago and I am approaching my budget for a car (around $6,000). I've started looking at cars online, mostly either Hondas or Toyotas since I hear they are built like tanks and cheap to maintain. I'm a little skeptical of using Craigslist for such a large purchase so I've mostly stuck to autotrader, car gurus, and cars.com. Is there anything I should look out for or any tips for buying my first car?

 

I was in your situation about 6 years ago making my first car purchase. Ended up purchasing a $5,000 Corolla with 120K miles off Craigslist. Later sold it to my brother-in-law but it's still running today. I watched a few Youtube videos on evaluating used cars so I knew what to look for (basic stuff like checking tire wear, oil, shocks, A/C, etc). Make sure you bring someone else with you and be very skeptical of anything that looks fishy. There are plenty of cars out there, so if something doesn't seem right, get out of there. The owner should also be comfortable with letting you take the car for a test drive and to a mechanic if you think you want to make a purchase. A legitimate owner should also have records of the previous maintenance. Most shops will do an inspection for less than $100--and this gives you some leverage in negotiating since they will give you an estimate of needed repairs.

 

Also, don't underestimate the other costs associated with the car. Insurance is expensive. There's also going to be repair bills--I've loved my Toyotas but inevitably a car with 100K+ miles is going to have a few $500-$1000 repairs. Keep putting money into your car fund after you purchase the car so you can afford a repair when it pops up.

 

Since you have $6K saved up, another option is to finance a nicer used car. You might want to check out a credit union and see if you can get approved for a loan. Dealerships have a large stock of relatively new cars for under $15K which might be a better deal in the long run.

 

I'm working an $8/hour job until my degree get's me somewhere. Not sure I'm really qualified to be taking out a car loan even if it would be relatively small. Plus I'd imagine my insurance rates would be through the roof for a new driver with a relatively new car.

[xisxisxis]

Save your money and use uber and mass transit. Take $3000 of your money and invest it in an ETF like UWTI or UGAZ. Before you use $3000 on uber or mass transit the ETF will double or triple.

[nate82]

I'm working an $8/hour job until my degree get's me somewhere. Not sure I'm really qualified to be taking out a car loan even if it would be relatively small. Plus I'd imagine my insurance rates would be through the roof for a new driver with a relatively new car.

 

I wouldn't get a used car if I were you at least not until you can get a job that pays a little bit more. You need to think about the extra expenses owning a car brings. You are now going to have to pay for insurance monthly while a used car shouldn't be all that much but since you are young and you do not have a driving record your rates are going to be rather high. Now you also have to figure in that you are going to have to pay for registration every year which is not all that expensive but it is still an extra expense each year you will have to pay. You will also have to pay for gas which while gas is low right now but it will not stay that way.

 

I don't know what your financial situation is but you might want to hold off on buying a car for now.

[adamb100]

Insurance for me would be about $700 a year.

 

I've relied on public transportation for too long and it's hindered my job search since I can really only look at places on a bus route, and cant even look at other cities such as Madison. Plus I've ran into a few postings that say "drivers license/car needed." I'm also tired of relying on others for areas where the bus is impractical (grocery shopping).

 

My expenses are pretty low (about $250 /month) though that will go up to about $400 soon with another expense. I could quite literally probably get by on a tank of gas a month if not longer. My life is not bustling with activity and the places I do go maybe average about 10-15 miles a week.

[Invader3K]

I'm working an $8/hour job until my degree get's me somewhere. Not sure I'm really qualified to be taking out a car loan even if it would be relatively small. Plus I'd imagine my insurance rates would be through the roof for a new driver with a relatively new car.

 

Buy used and pay cash. Don't mess with a car loan. Hopefully having the car will let you interview for better paying jobs. Good luck!

[DHonks]

That's tough. My high school students make more than that while working 40+ hours per week. Is there a Costco near you? Last I heard they were moving into Wisco. My students working there pull in $17-20 per hour, have great benefits, and enjoy the work. There's a reason Costco works are usually so pleasant! I know last year I was frustrated to do the math and find that if I were an entry level Costco worker, I'd make more than I do as an 8th year teacher.

[adamb100]

Closest Costco to Milwaukee is in Pewaukee (15 miles away).

[DHonks]

Adam, besides that there are other options. Making $8/hr is a big part of your problem. That's the wage a high school junior should be making. There has to be something else that can provide you with more income. I know they're not sexy, but I hear Milwaukee's manufacturers struggle to find capable employees that are literate and can pass a drug test. That's why they often pay $20+/hr. Not sure if they do part time work though. If you can increase your earnings, then you can afford the car. If you cannot, then I agree with most here that a car may not be the best route.

[1992casey]

Costco is also in Grafton, but the issue remains the same.

[owbc]

Have you considered Zipcar or another form of car sharing? I'm not sure how widespread car sharing is in Milwaukee, but I've been using Car2Go in Seattle and it is very useful when the bus isn't convenient. It costs me about $30/month to use it one or twice per week.

[superfly]

Save your money and use uber and mass transit. Take $3000 of your money and invest it in an ETF like UWTI or UGAZ. Before you use $3000 on uber or mass transit the ETF will double or triple.

 

Absolutely horrible idea to tell a young kid who likely has no stock experience to put his minimum wage money in a 3x ETF whose natural state is to decay over time. It will also likely reverse split sometime soon. At least if he buys AAPL its a good company who will not implode itself.

[Invader3K]

He shouldn't even be worrying about investing until he gets a good paying job, hopefully one where there is some sort of investment/retirement option offered.

[Patrick425]

That's tough. My high school students make more than that while working 40+ hours per week. Is there a Costco near you? Last I heard they were moving into Wisco. My students working there pull in $17-20 per hour, have great benefits, and enjoy the work. There's a reason Costco works are usually so pleasant! I know last year I was frustrated to do the math and find that if I were an entry level Costco worker, I'd make more than I do as an 8th year teacher.

 

Your high school students work 40+ hours per week?

[adamb100]

The pay sucks, yes, but its been a good experience. It's retail and after working on the floor and in logistics in the back, I realize the crap-ton of work that goes into getting guests to spend $$.

[DHonks]

That's tough. My high school students make more than that while working 40+ hours per week. Is there a Costco near you? Last I heard they were moving into Wisco. My students working there pull in $17-20 per hour, have great benefits, and enjoy the work. There's a reason Costco works are usually so pleasant! I know last year I was frustrated to do the math and find that if I were an entry level Costco worker, I'd make more than I do as an 8th year teacher.

 

Your high school students work 40+ hours per week?

 

Seniors with enough credits (in AZ) to be on a path to graduating only need to take 4 classes. So they are done at 11:40 AM. Some also take online classes, so they may actually only be in school for 2-3 hours. Most of them have jobs starting between noon and 1 pm, lasting until the night. My student working at Costco works over 40 hours per week. He loves that he gets paid overtime AND Costco pays extra for working Sundays. My sophomores tend to work more like 20-25 hours. I thought there was a restriction on work for a 16-year old during the school year, but the students won't complain since they like money.

[Patrick425]

That's tough. My high school students make more than that while working 40+ hours per week. Is there a Costco near you? Last I heard they were moving into Wisco. My students working there pull in $17-20 per hour, have great benefits, and enjoy the work. There's a reason Costco works are usually so pleasant! I know last year I was frustrated to do the math and find that if I were an entry level Costco worker, I'd make more than I do as an 8th year teacher.

 

Your high school students work 40+ hours per week?

 

Seniors with enough credits (in AZ) to be on a path to graduating only need to take 4 classes. So they are done at 11:40 AM. Some also take online classes, so they may actually only be in school for 2-3 hours. Most of them have jobs starting between noon and 1 pm, lasting until the night. My student working at Costco works over 40 hours per week. He loves that he gets paid overtime AND Costco pays extra for working Sundays. My sophomores tend to work more like 20-25 hours. I thought there was a restriction on work for a 16-year old during the school year, but the students won't complain since they like money.

 

I guess I can see that, but then you can not be involved in any other activities or sports. My son plans on doing the same thing next year with a "co-op" class (he's a Senior next year), but I don't think he will work any more than the minimum hours needed to get the credits because he will have a couple of AP classes, is on the golf and baseball teams, and is also involved in other activities (FBLA and Model UN).

[GAME05]

There's a WeedMan Lawn Care in Milwaukee that will be starting up the season probably next week. They always need people, and even if they say they're full, one or two people will be getting fired or quitting within a week. I worked at a different branch one summer. The season goes to early November, you work 5-6 days per week and days are 9-11 hours per day. It's a difficult job, but I made roughly $25K doing that for a season. Plus you end up getting close to the maximum allowance in unemployment after the season, which was another $4500 for me. I know this isn't exactly the thread for it, but there's your summer job.

 

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My clutch gave out in the middle of a long trip home. Even minor hills were almost impossible to accelerate up, so it's totally undriveable. It's parked in the airport in Kentucky. Fortunately I have $8K to spend without having to get a loan, so looking at spending $6K on the car with $2K of room for immediate repairs like timing belt and whatnot. aiming for boring and reliable this time. I learned my lesson last time not to get a 6-speed with a manifold that covers the engine (automatic hour+ shop charge for any repair done, even plugs) and also never to buy a first-year model.

[BrewersSuperCollector]

I use Weed Man and I like their work.

[TooLiveBrew]

I use Weed Man and I like their work.

Heh.

 

I'm guessing the quality of work is really, really high.

 

Heh.

[GAME05]

Driving that WeedMan truck around all day, I got some version of that joke daily. I had people taking pictures of my truck and even honking to stop me in the middle of the road.

 

Man that was a difficult job, but I was proud of myself that I made it through a year when people half my age couldn't hack it. Also proud to say I never cheated a customer out of good service.

[adamb100]

I was this close to buying a car: |--| Now I may be this close: |-------------------------------------|

 

Milwaukee County is going after the house I'm in for unpaid property taxes again that my father never paid off (he passed away, I'm still living in the house). It's flat out ridiculous how much interest and late fees they tack on. The base property tax is only $2,000 but with all the fees, it's over $4,000. I have the money, it's my car money of course. i've been through this process before, and the fees are in the state code so you can't work out a deal for the fees to vanish in exchange for paying the taxes.

 

The total bill of delinquent taxes from 2009-2013: $17,000.

 

It's basically an endless hole. You only have the $$ to pay off the taxes they are going after, so you are always letting them build up, never able to catch up.