Buying a car can be stressful. It’s the second biggest purchase most people typically make, besides their home. And when you start to consider all of the choices involved -- used versus new, luxury versus practical, along with the variety of makes and models out there -- the decision can get complicated.
How to make smarter used car buys
In the midst of widespread economic difficulty, a growing number of Americans are turning to used cars. The upside is that cars in general have become more reliable, so the used car lot isn’t as much of a minefield as it used to be. What used car buyers are looking for is a bargain: A vehicle in their budget that will be reliable over time. HLN Money Expert Clark Howard says reliability is one of a car buyer’s biggest concerns. You don’t want to spend all that money on something that won’t last.
Kelley Blue Book, a consumer guide to auto-industry pricing information and analysis, released a list of what it considers to be the top 10 used cars for less than $8,000. The prices are the retail values as of December 2011 and the list is based on the company’s Blue Book Value calculations for used cars from the model year 2002 and newer. The cars were chosen as having the ‘most appealing mixes of reliability, versatility and desirability, with an emphasis on track record.’
Japanese used cars get high marks
The 2004 Honda Civic tops the list as the number one best used car under $8,000, with a retail price of $7,970, which didn’t surprise the people over at Kelley Blue Book. The Civic is at the top of sales charts every year and the car’s quality and reliability make it one of the all-time best used cars, according to KBB. Number two on the list is the 2002 Infiniti G20, which KBB says gets you more features for less than what you would pay for a similarly-sized car. And number three is the 2002 Toyota Corolla, which may not be the most exciting, feature-filled sedan. But KBB says a Corolla is always worth considering when you’re on a budget. Another positive note for these same carmakers: Honda, Infinity and Toyota all ranked in the top 10 of a recent Consumer Reports survey on automobile reliability.
Clark says: Do you homework and shop around
As tighter budgets have become a reality for more and more Americans over the past few years, all of the choices involved in a decision like what car to buy are more important than ever. Because there can be so many complicated factors involved, Clark Howard suggests using surveys and advice from consumer advocates like Kelley Blue Book, Consumer Reports, Carfax and J.D. Power. But don’t rely solely on one resource. If you’re buying a used car, make sure to get it checked out by an independent mechanic before you make the purchase final.
Clark says: Always check a credit union for car loan
And when it comes to financing, shop, shop, shop! A recent report showed that four out of five car buyers get their financing at the car dealer, which Clark Howard says is a big mistake! Dealers can mark up loans without you even realizing it, which means you would end up paying a much higher interest rate than necessary. Clark says the first thing to do before you go shop for that car is go to your credit union, (if you aren’t a member of one, join one; if you can’t, then go to your bank) and see what you pre-qualify for on a car loan. This will give you a sense of the length of loan term, what you will pay per month and the loan’s interest rate, before you even hit the car lot.
The car-buying process can be complicated and frustrating, but a little research will take you a long way. Take your time, and use the resources out there to be sure you’re making the most of your hard-earned money.
Here’s the complete list of KBB’s top 10 used cars under $8,000:
2004 Honda Civic, $7,970.
2002 Infiniti G20, $5,965.
2002 Toyota Corolla, $6,125.
2004 Pontiac Vibe, $7,630.
2004 Scion xA, $7,805.
2003 Ford Escape, $7,560.
2002 Toyota Tundra Standard Cab, $5,925.
2003 Mazda Protege5, $7,360.
2004 Ford Crown Victoria, $7,970.
2008 Kia Rio, $7,895.