Clark Howard

7 rules for buying a cheap used car with cash

Can you really buy a reliable used car for just $2,000 or $3,000 in cash? If you ask Joel of our team, the answer is clear.

"There is a myth that has brainwashed the mind of many a consumer that I just can't abide any longer," Joel says. "That fable is that good cars just can't be had for under $10,000. What a bunch of hooey!"

Joel was one of the pioneers of buying cheap used cars on The Clark Howard Show. Back in 2008, he bought a 1996 Nissan Altima with 200,000 miles on it. The price tag on that sweet ride? $3,200 paid in cash.

In the spirit of Joel, here are seven tips to find a great cheap used car…

Read more: The secret to putting 1 million miles on the odometer

Look for cars that have uglied out

Dents, nicks, peeling paint and hail damage are all your friends when buying a used car. The more scuffed up the exterior looks, the more you can haggle the seller down on price. Remember, exterior flaws won't impact what's under the hood!

One area to beware of though: Tires. If the tires are bald, you could have to shell out several hundred dollars more. So consider that when you're haggling about the price.

Follow the 10 years/100,000 miles rule

Ever heard Korean and Japanese manufacturers like Hyundai, Kia and Mitsubishi advertising their 10 year/100,000 mile auto warranties?

That’s the inspiration for a different rule you should follow if you only want to drop two or three Gs on a used car: Look for cars that are 10 model years old and have at least 100,000 miles on them.

Think 100,000 miles is too much and that are car with that many miles is probably near the end of its useful life? Think again. It's entirely possible for vehicles made within the last 10 to 15 years to ride 200,000 miles or more if they're properly maintained.

Know where to look

When searching for cheap used cars online, check Craigslist, AutoTrader, iSeeCars, the Klipnik message boards and CarGurus.

The latter site lets you put in your zip code and the make/model of the vehicle you're interested in at their website. They'll comb through some two million listings available on published databases and rate the vehicles available for sale with notations of 'great price,' 'good price,' 'fair price' and on down.

(Full disclosure: AutoTrader and Fans 1st Media are both Cox properties.)

Beware those beloved nameplates

Honda and Toyota pretty routinely top the tally for car reliability that Consumer Reports does, which means there's a premium on their resale value.

If you want a really cheap yet reliable used car, skip the Hondas and the Toyotas of the world. USA TODAY recommends you instead look at what are called 'second-tier' Japanese brands such as Mazda, Nissan or Mitsubishi.

You’ll also probably want to skip European models but for a different reason. Cars with German engineering, for example, are so finely tuned that they require a lot of upkeep. That’s extra money you’ll always have to be spending in the shop.

A happy medium might be something like the Ford Focus, according to USA TODAY. That particular model from the U.S. automaker has a lot proven reliability, which brings us to our next point…

Check Consumer Reports for reliability

The annual Consumer Reports auto reliability survey is the most extensive survey of automotive reliability. They do a great job parsing the new models every year when they come out.

But here’s the real value for a used car buyer: The magazine also offers detailed reliability ratings for the past six model years on every possible nameplate. These ratings are compiled from reports about 17 common trouble spots in more than a million cars on the road.

Talk about a great vantage point on long-term reliability!

Check the vehicle identification number before buying

Be sure to run the VIN though CarFax.com to find out if it's a flood vehicle or if it's been in a horrible accident. You'll be able to see any title problems, liens, odometer rollbacks, the salvage history and more.

Then go one step further and run the VIN through a free database operated by the National Insurance Crime Bureau at NICB.org.

Get an inspection by an independent mechanic before buying

We saved the best for last. This is probably the most important rule of them all!

One of the key things to know about buying a used car is that you buy ‘as is.’ CarFax alone is not enough of a check; you need to take this additional step too.

Never rely on any representations that the salesperson makes about the car, be it a commissioned employee at a dealership or an independent seller in your neighborhood.

You want an ASE-certified (Automotive Service Excellence) mechanic to really kick the tires on your potential buy. Garages that participate in the Blue Seal program typically feature the most highly trained ASE-certified mechanics. Visit ASE.com to find one near you.

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Top tips for buying a used car