Buying a Good Car With Cash

If you’re limited on funds, getting a car loan can be a bigger burden to your budget. You’ll be locked in for years for a payment and many times you have to pay even more on car insurance as per the lender’s requirements. Buying a car with cash can be an economical choice both now and later as you have more room in your budget to take care of other financial obligations.

You may be wondering if it is possible to find a reliable car on the cheap. I want to share with you how we were able to do and give you some tips on buying a car with cash.

Stuck with Finding a Reliable Car Fast

In 2010 my husband and I were driving home when we were hit by a young driver who was distracted. Fortunately all of us were fine (a little bruised, but it was minor), but the cars weren’t. After the adjuster saw my husband’s car he looked at him and told him it was going to be declared a total loss. We’d have to look for another vehicle and soon.

This put at us at a bind. We were already saving up a bit to replace my vehicle as it was getting older and repairs were becoming more frequent. Now we had to hold off on it and look for at cars for him. Happily the other guys insurance came through rather quickly and gave us a check to cover the value of our totaled car.

The amount wasn’t enough to buy a car at a decent dealership, but it was enough to get a reliable commute car for us.

Finding a Car That Fits Our Needs

The first step was looking at our budget and defining what we need out of this next car. Basically it came down to buying a car that was:

• Reliable – No one wants to buy a lemon, so when we were looking for cars we limited ourselves to car brands that had a reputation of quality.
• Fuel Efficient – Gas is over $3/gallon and it doesn’t look like it’ll decrease. Looking at total costs, we knew that getting a fuel efficient car was the way to go for us.
• Lower Repair Costs – My Jetta is a very reliable car, but when it does need repairs, it can get expensive due to parts. Check ahead before you buy to see what typical prices are for maintenance and repairs on the make and model you’re looking at.

By the way if you’re looking for a reliable used car now here a few cars Consumer Reports recommends as dependable:

• 2001 – Toyota Echo, Toyota Avalon
• 2002- Toyota Avalon, Ford F-250
• 2003 – Toyota Tacoma

Yeah, you may notice a theme here. Toyota seems to have a lead on reliable cars. It’s not always the case (some owners abuse their vehicles), but it’s good idea to know what to look for when shopping around.

Buying a Car from a Private Seller

We started looking on Craigslist and asked our friends and family to be our eyes and ears for possible deals. Buying from a private seller can be risky if you’re sloppy, but for those with an eye to detail you can find some gems at incredible prices.

When calling for possible cars, we asked questions to screen out potential lemons and save us time. Some questions we asked were:

• Why are you selling the car?
• How many miles are on the odometer?
  
• Are you the original owner?

You’d be surprised by how many people don’t know much about their cars (which is a warning sign).

Seeing the Car in Person

Once we narrowed it down, we decided to check out the cars in person.

• Inspect and test drive. Before buying a car from a private seller make sure you get the car checked out thoroughly. Don’t try to save $50-$60 when getting inspected and then get stuck with a car that needs 10x or more in repairs.
• Ask for paperwork. See if the owner has maintained the car regularly. When was the last repair they’ve had? Who’s their regular mechanic?
• Drive to your bank for the money. When you’re buying the car, don’t ever pay in cash. Instead head over to your bank and have them cut you a check. You can also get the car titled notarized right there, saving you a trip.

We found a great deal on a well cared for used car in our city for a Celica. The seller did a fantastic job maintaining the car and had all the paperwork on the car. I believe that tipped the scale for my husband, as he felt that owner was more conscientious.

Thoughts on Buying a Car with Cash

I’d love to get your thoughts on buying a car. How many of you are currently looking for a vehicle? How many of you have bought a car with cash?

Elle helps families at Couple Money achieve financial freedom by sharing tips for reducing debt, increase income, and building net worth. Learn how to live on one income and have fun with the second.