Cheap Cars - How and Where to Find the Cheapest Cars

Cheap cars can be found and purchased from a variety of sources. Generally, people who are looking for cheap cars are simply attempting to find the best car that meets their needs, at the lowest possible cost.

For those who are looking for inexpensive cars, there are essentially three categories of options available to them — cheap new cars, cheap used cars, and cheap leased cars. Let's focus on used or pre-owned cars.

Used cars at low prices are available from dealers, individuals, auctions, and on the Internet. Considerable care must be taken when buying pre-owned cars because most are sold "as-is" and will come without a guarantee or warranty. Certified Cars offered by dealers representing major car manufacturers are an exception, although more expensive.

Following are the best places to find cheap cars for sale:

Used-Cars at New-Car Dealers - Most new-car dealers typically sell both new cars and pre-owned cars. Although inexpensive cars can often be found on these lots, most new-car dealers only offer relatively late model used vehicles that have been taken in trade or are off-lease, and are in good condition — and are relatively expensive. Older, less expensive vehicles are usually sent to auction to be purchased by independent used-car dealers (see below) and BHPH dealers (see below). Therefore, check your local dealers but also look at other sources listed below.

Independent Used-Car Dealers - Independent used car lots are a potential source of affordable cheap cars. Many lots have older vehicles that can be real bargains. However, proper caution should be taken to determine if the price is fair and that the vehicle has no hidden problems. Most used cars are sold "as-is" and come without any kind of warranty or return policy. See Buying a Used Car for more details.

Buy-Here-Pay-Here (BHPH) Dealers - A special type of independent used-car dealer that provides in-house financing, usually with no credit checks. Most BHPH dealers are local and can be recognized by their "we finance anyone" or "no credit check" banners. Be aware that interest rates are usually high and payment terms are strict. DriveTime.com is a large national BHPH car dealership with 86 locations in 10 states specializing in cars for people with poor credit. They have a large number of cars in all price ranges, have a 4-stage, 53-point inspection on all cars, provide a standard warranty, and an online payment option.

National Used-Car Dealers - If you live in an area that has a Carmax car superstore, this is one of the largest, most reputable used-car dealers in the country, and a good source of fair no-hassle deals — although not necessarily the cheapest deals. They inspect the cars they sell, provide a money-back guarantee, and a limited warranty. Many people consider their cars to be a bit overpriced, but you get a little extra piece-of-mind for the money.

New-Car Bargains - Don't overlook this year's (or last year's) brand new cars as a potential source of good bargains. There are currently tons of heavy rebates and other incentives being offered by car manufacturers, especially on domestic brands, that can often make certain new cars temporarily less expensive than used cars of the same make and model. See New Car Rebates and Incentives. Even without incentives, some car models such as the new Hyundai Accent and Nissan Versa now list for less than $10,000.

UsedCars.com - UsedCars.com is the Internet's largest used car buying service, with over a half a million used car listings. They have helped millions of people find used cars at good deals all over the country. We like the search tool that allows you to locate cars in your area in the price range you want. If you are looking for cheap cars, they've already worked out discounted prices with the sellers, and make the buying process easy. We like this service and recommend it.

Lease a New Car - If your goal is simply to get low monthly car payments, leasing a new car can be 30% to 60% less expensive than buying the same car with a loan – cut your payments in half. This allows you to drive a brand new car for the same or less money than you might spend on a late model used car. However, be sure to read our free Lease Guide before you make a decision to lease. It's cheap but not always the right answer for everyone.

Lease a Used Car - Used-Car Leasing is a good way to acquire a cheap car. Leasing a used car offers the lowest possible payments, much lower than buying with a loan, and is typically less expensive than leasing a new car. Leasing a used car is not dependent on where your used car comes from - from a dealer, from a used-car lot, or from an individual. Find a used car locally, or online at UsedCars.com, and arrange to lease it by contacting PrimeLease.com. (Note: Used-car leases are becoming more difficult to find in times of tight credit. Consider a lease takeover instead – see below)

Lease Takeover - Online services such as Swapalease offer short-term lease takeovers at bargain prices. These are almost-new cars being offered by sellers who are desperate to get out of their leases. If you can find the car you want, this can be the cheapest way to drive a good late model car. Payments can be very low compared to a new car loan, or even a used car loan. Credit requirements are not as strict. Sellers frequently offer cash back as an incentive for someone to take over their lease. These can be excellent deals. Swapalease is the largest and best of the lease transfer assistance services.

Free Cars - If you live near a large city, or university campus, you may be eligible for a Free-Car Program. It's tough to qualify but the rewards are great — a free car to drive. These programs are offered by advertising companies who use "vehicle wrap" marketing techniques. Free is about as cheap as you can get. Competition is heavy so don't expect to get accepted right away.

Get Paid to Drive - Get-Paid-to-Drive Programs are similar to the previously mentioned free-car program, except that you get paid to drive your own car with paint-safe vinyl ads displayed on your own car. The money can help make your car payments and pay expenses. That amounts to cheap transportation. Again, it's not easy to qualify for these programs.

Government Car Auctions - This is an often overlooked source of cheap cars and trucks. Local, state, and federal government and law enforcement agencies frequently auction surplus and seized vehicles. Outstanding bargains are possible. To participate, you have to know where and when the auctions take place, and how to bid. See Government Auto Auctions for more details.

Damaged Cars - Low cost cars can often be found from sources of Salvage Cars or Flood-Damaged Cars, although some repairs are often necessary. Salvage Auctions and Insurance Auctions are another possible source of cheap cars and project cars for sale. Obviously, a lot of caution must be taken to make sure you know exactly what you're buying but, if done correctly, some great deals can be had this way.

Police Auctions - Law enforcement agencies seize and impound vehicles from law-breakers and sell them at public Police Impound Auctions, for bargain prices. Many are high-end late-model luxury vehicles in perfect condition. These auctions are conducted regularly and are open to the public.

Repossessed Cars - Repo Car Sales and Auctions are a good source of cheap cars. Banks repossess cars from customers who stop making payments and default on loans. They must sell these repo cars to recover the remaining loan balance. Bargains are not difficult to find if you know how and where to look.

Rebuildable Wrecked Cars - If you have mechanical skills, Buying and Rebuilding a Wrecked Car can be a way to a cheap ride. Cars that have been declared total losses by insurance companies can often be purchased as salvage vehicles and project cars for almost nothing. Many of these vehicles have little damage and can be rebuilt and restored to good running order for little money.

Unclaimed and Abandoned Car Auctions - Cities and towing companies pick up abandoned vehicles every day. They try to find the owners, but if they can't, the cars are sold at auction, often for almost nothing. The cars can range from junkers to almost-new vehicles. See our article, How to Find and Buy Unclaimed Cars.

Rental Car Sales - Rental car agencies, such as Enterprise, often dispose of late-model vehicles in public sales. Contact rental agencies in your area to find out how, when, and where. Many people use this method regularly for buying their family cars. Prices are often lower than at used-car dealers because rental companies are not trying to make a profit.

Purchase from Individual - You can find cheap cars being sold by individuals by searching newspaper classifieds, web sites such as AutoTrader, on supermarket bulletin boards, and at local car sales consignment lots. Many are being sold at low prices for a good reason. In many cases, these cars have problems that the seller is not disclosing. Or the seller could simply be desperate and needs the money fast. Such cars are sold "as is" which means you have no recourse if problems come up. See Used-Car-Advisor.com for more advice.

Get a Used Car Dealer's License - This is not a solution for everyone, but it can work for some. The idea is to get a used car dealer's license, go to dealers' car auctions, and buy cars at wholesale prices — even buy and sell for profit. Since state laws determine how to get a dealer's license, you have to know how to do it. Here is an article that explains how to Buy and Sell Cars for Profit.

Why no eBay or Craigslist?
You may have wondered why we don't list eBay and Craigslist web sites as good sources of cheap cars. Although some people have good buying experiences with these sites, there are inherent problems with long-distance buying. You can't see the car, you can't drive it, you can't inspect it, and, in fact, you don't even know if the car exists. Payment issues and seller scams are very common (see below for explanation). If you buy a car this way, only buy from local buyers or buyers in locations you are willing to travel to.

Watch out for online car buying scam
Be aware of a common car selling scam in which an online seller offers a nice car for a price that seems too good to be true. This scam is very common on eBay and Craigslist. It is almost impossible to spot the scam from the ads, except that the price seems to be unbelievably low. If you fall for the scam, you'll lose your money and you'll never see the car you "bought." See the following article, Car Selling Scam for details.

If you plan to mod your car for best performance
Many people looking for low cost cars know that they will eventually customize or mod the car with aftermarket parts to increase power, speed, and performance. Having a plan and shopping for best prices will keep your costs down. Make sure you only use quality parts, which will be important for reliability and safety.

Get your car inspected
Regardless of where you decide to buy your cheap car, you should have the vehicle thoroughly inspected, whether you do it yourself or hire someone to do it. By doing so, you'll protect yourself from making serious mistakes that can't be corrected later. Look in your telephone yellow pages for "vehicle inspection service" or go to a local car service shop. Although there will be a small cost, it's a good investment. Also get a CARFAX Vehicle History Report to make sure your car doesn't have a hidden salvage title and has never been wrecked.

If you need a loan
Used car loans are available from banks, credit unions, and online loan companies such as DriverLoans . If you have bad credit, getting approved might be difficult. It's best to get preapproved so that you'll know exactly how much you are allowed to borrow. Read our article, Bad Credit Car Loans, for more information.

Summary
Cheap cars are available from many different places including consignment lots, police impound auctions, government seized and surplus auctions, repossessed vehicle sales, online used car web sites, and rental car sales. You may have to invest a little time and effort to find them but the results can be rewarding.

For more, see LeaseGuide.com

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