Buy me (or give me some opinions) on buying a used car

Well, I’m in the market for a used car. I just graduated from college and now I’m employed and secured a nice loan of around $12,000 with 8.5% interest rate. This is good news!

However, there are two sides to everything. Being under 25 years old, my insurance rates are sky-high. From what I’ve looked at, the monthly payments of the car and insurance payments would be almost equal and I can’t expect a drop until I’m 25 (even though I have a perfect driving record) So, I’m basically stuck with liability which means I’m pretty much destined for a car far under $12,000. A reliable friend who I look to for advice said I should shoot for around $5,000 then upgrade when I’m 25 and my rates drop.

The fact that I have good credit and received the good loan makes me want to get a nicer car. Although I’m not looking for a souped-up speed demon, I would be happy with a newer reliable car that is over $5,000.
So, my first question is: Do you agree with this outlook? Why or why not?

Second, I was going through classifieds, etc and I have certain criteria when picking a car to further look at. the cars that stuck out so far which are relatively new, under 100,000 miles, around $5,000 and no prior accidents have been a 2000 ford focus, a 2000 impala (miles unknown yet), a 2000 cavalier, a 1999 intrigue, a 2000 dodge stratus, and a 1999 grand am.
Does anyone have any thoughts on purchasing one of these as a used car either good or bad?

Third, does anyone have a reliable car they are looking to sell with a dopers discount??

And fifth, what general advice do you have on buying a used car?

Thanks dopers, if all works out, I’ll give everyone who responds a ride.

Don’t get a loan for something that’s going to depreciate. Get a banger. Given that your insurance is going to be so much, you might want to look at whether not having a car is cheaper. Don’t forget to budget for the fuel.

When I was irs looking for car insurance, I got a quote from one insurer which they cut significantly (30% or so) when I mentioned that my mother was insured with them and I had driven on her insurance as a learner without incident.

If, on the other hand, you consider buying a car you can drive until its wheels fall off rather than something you’ll ditch in a couple of years, a used car that depreciates quickly can be a great deal.

Get the Consumer Reports Car Buying Guide. It’s very useful when you’re considering a used car, because it shows which makes and models are reliable and which to avoid like the plague.

And once you start focusing in on some specific vehicles, check the Kelley Blue Book, which will help you determine if the asking price for the car you’re considering is reasonable.

A nice used car is very thrifty. Or can be. It can also be a money pit if isn’t extremely careful. Your best bet is to pay cash and buy through a private sale. Currently there is a pretty good glut of new and newer cars, so used cars don’t have a premium they have had in the past. Is this car loan you’ve secured only to be utilized at a commercial car lot?

actually the loan is for a ‘used car’
pretty broad language.

I agree with not getting a loan. My first car cost 250 dollars (in 2002). It needed a new transmission, which we rebuilt for 350 dollars worth of parts, but would have been around 1000 to have it done. The car still runs fine, although I gave it to my brother when I bought my current car before my misadventure in California. I got a good deal on stick shift, bare bones Dodge neon that no one else wanted. It was three years old with 14K miles on it and set me back less than 7800. I love it. I don’t care what anyone says about neons, it’s comfy, fun to drive and reliable. And gets great gas milage. Shop around and look at private sellers, although I got mine from a mostly new car lot.

Another vote against the loan, try to keep your monthly expenses as low as practical and build up a cash reserve for emergencies and for expenses such as cars. Try to live within your current means, not revolvolving debt.

I am not sure that you can take that kind of loan and go with only collision insurance. The loaning company is really the one that owns the car until it is paid off and they want good assurance that they will get all of their money even if you drive it straight from the lot and total it. I had one loan like that when I was about your age and I most certainly had to have full insurance on it.

If you’re willing to broaden your criteria for age of the vehicle, you might be surprised at what you can find. My current car, a 1981 Honda Prelude was in near mint condition when I bought it (unfortunately, I smacked a Bambi and she’s no longer quite the stunner she once was), had all the service records from when she was new, and was well under $5K. In the time I’ve owned her, the only things I’ve had to do (other than routine things like oil changes, etc.) is the front brakes, a water pump, and CV joints. Total cost for all of that has been about $600. (And the only repair I did myself was the brakes.)

Admittedly, cars like mine aren’t always easy to find, but they’re out there if you’re willing to look for them, and a car, no matter how old, that has proof of regular maintence being performed is well worth the money.

As for the cars you mentioned, I’d stay away from the Ford, as IME, Ford’s tend to develop electrical problems after a couple of years. These can be expensive and difficult to track down (even for a professional mechanic). Most of the Grand Ams of that era have earned the wrath of the owners I’ve known, and the comments on the Stratus have been iffy at best. American cars have gotten better in recent years (at least in terms of initial quality), but I’d go with a Japanese make if I were you. Most of them are highly reliable cars that you can drive till their wheels fall off. You might also check with your insurance company to see what their rates are on various makes (and you might want to check with other insurance companies to see if yours are in line with theirs, one heavily advertised insurance company wanted nearly $100 more than anybody else I checked with for the same level of coverage).

I assume you meant to say, “only liability insurance”?

I was told by the dealer when I purchased my vehicle that by California law, a car must have both liability and collision if it is being financed.

Regarding insurance, I agree that you should hit up a relative’s agent first, so long as that relative has a good driving record. Agents do get better rates for people they feel they know than for walk-ins.

Regarding car choice, if you have little mechanical ability, little patience with Annoyance of the Month, and no bus or co-worker or parents’ spare car to lean on in times when the Annoyance becomes crippling, get the newest vehicle you can, even though you have to have a loan and full-coverage insurance.

Otherwise, find a heap that’s going to cost you a maximum of about $500 less than your available cash.