Car Corner
Cars For $300 A Month

May 1, 2009
By Scott Lewis

A few months ago I ran an article showing desirable, but older cars for $15,000 or less. Some of the cars were a lot less than $15K. I followed that up with another article with a price ceiling of $7,500.

Both of those articles had a hidden agenda. They assumed that you would buy a car as a second, or recreational, car. Yes, I would try to put any of the cars I listed in either of those articles into daily use. But it was expected there was backup transportation. Older, high mileage luxury or sports cars need repairs and maintenance. This could be a problem if you have to get to work Monday morning.

This month I will try this topic again, but with a different hidden agenda. O.K., It won't be a hidden agenda this time. The agenda is to find an assortment of cars that could be sole transportation for $300 a month.

Toward that end I fudged a little. I initially wanted to just throw $15,000 out there. But that is not completely realistic. And I want realism. I created a simple spreadsheet to calculate loan payments for a car. Yes, I know, there are a million web sites that can do this. But my spreadsheet takes into account sales tax (which effects most of us) as well as Tax, Title & License (TTL), interest rate and the length of the loan. I have slotted in fields for the down payment and a trade-in as well.

I used numbers that seem close to what I have available in Texas. I used 8% for the sales tax rate. I think it might be 8.125% for a car, but I do not know for sure. I also used 5% for a loan rate with a 5 year loan. This is close to what my credit union is offering. You can check with your own financial institution before filling out the spreadsheet.

You can download the spreadsheet here.

The beauty of this spreadsheet is that it is easy to duplicate columns of data and build a comparison sheet. You will find three pages to this spreadsheet. Page one has the basic formula and fields for calculating loan payments. Simple enough. Page two will have repeated this formula for each car below. It is the spreadsheet that provided the monthly payments listed with each car below. Page three contains one car from below using a variety of loan rates and terms as well as down payments and purchase prices. This is what you should do when shopping for a car so you can know exactly what to expect when negotiating. You want to know what taking $500 off the price of a car will do to the monthly payments. You don't want the dealer to cloud the issue with ranges of numbers. I find it amazing that a salesman/manager will hand you a piece of paper with a $50 range on a monthly payment. They have all the tools to present you with a payment to the penny, and they don't. Use my spreadsheet when shopping for a car. In fact, load it on a laptop and take it with you when you shop. Put the salesman on the defensive for a change.

What about the search criteria. That's a tough one. We are looking at trying to find an affordable car that will be your only mode of transportation. Yes, we are going to look exclusively at used cars. I listed a Honda Fit as a baseline comparison vehicle.

Since I am a car enthusiast I want to look for cars that have passion. But, the car must be a true daily driver. That means it MUST have a warranty. For this selection of cars that means a factory warranty. The easiest way to be sure of that fact is to stick to cars with less that 36,000 miles. This way the car is still under the factory warranty. Where possible I limited searches to cars with under 30,000 miles. That should hopefully be enough to find any flaws before paying for repairs. As for my search... I wanted this to be as realistic as possible, so I limited the search to 100 miles from my zip code. Since these are just regular used cars there seemed little reason to travel half way across Texas or to another state to find a decent used car.

To get to the $15,000 price ceiling I had to put %503 down to get the monthly payment to exactly $300. If I (or you) was willing to pay $309.49 a month then we could skip the down payment. I am going to stick with this as it is easier to plug in $15,000 into a used car search engine.

I also listed Kelly Blue Book's retail value for each car. I fudged on the KKB value. I did NOT add any options to Kelly's web site (unless noted otherwise). So if a car had a premium stereo it did not get credit for it in my simple research. I tend to think this is what dealers do. How can they really know your have both the Premium and Sport packages on the car unless you tell them. And even then they probably don't want to add extra stuff to the KBB form to pad your price. So, I did not pad prices here. There were a couple of simple exception, but they are small. For this exercise we only needed to enter the year, make, model, trim, auto or manual trans, and finally mileage.

Why KBB and not NADA? That is a good question. I use NADA all the time when looking up classic cars. Let's see how it works. The first car I listed below is a 2008 Scion xB with a manual trans and 10,587 miles. Let's see how KBB and NADA stack up:

              KBB         NADA
Trade In      $13,025     $12,150
Private       $14,840     N/A
Retail        $17,840     $15,250

NADA does not have a "private party" value. For Kelly I used "Good" condition for the trade in and private party values. I went with NADA's "Average" for the trade in value. Both KBB and NADA only give you one figure for the retail value. NADA is lower, which is what you want as a buyer. But I wanted to play around with the private value number on a couple of cases below. Keep in mind that for the most part all the cars below are priced reasonably. It is up to you to negotiate a deal. I just wanted consistent numbers so you could see that we weren't finding long shots.

I list a couple of standard transportation cars in the Honda Accord and Civic. We'll see how this goes. I wanted to stick with "cool" cars. At this price/mileage point that is easier said than done.

Extended warranties. You could always buy a car that is outside the factory warranty using an extended warranty. Maybe that's for another article. That would certainly open the door to some nice cars with somewhat higher mileage than the cars presented here. Feel free to do that if this article inspires you to go shopping.

Honda Fit - $15,420

The list below, and the price I selected was more than a match for my previous article. It seemed attainable for an entry level new car. So I did some searching. I found it amazing that almost none of the Honda dealers in my area posted prices for the Honda Fit, even when they had plenty in inventory. The big surprise was the dealer that claims the one simple price (known as menu price in a lot of areas). This is a no haggle price they display on the car that is supposed to include all discounts. I like the concept, just not how it is implemented in most dealers. Regardless, why would a dealer that claims to do business with a one simple price put a "Call For Price" on their web site. I don't get that. Just put your one simple price on your web site. Save me a trip if I don't like it. Better, make that price good enough I don't waste my time at your competitor's dealership.

Anyway. The one dealer in or near San Antonio that did have actual car prices had its lowest priced Honda Fit listed at $15,420. I do not know if this was the MSRP, but it was a real price, as they has a wide variety of prices on their web site. And this is the reason for selecting cars at just below $15,000. The idea is what could you get if you were willing to get a few miles on a mildly used car. Could you get something more fun than a new Honda fit for about the same money?

Let's find out.

2008 Scion xB, 10,587 mi., $14,988

KBB Retail: $17,840

Description: The ad listed all the basic standard and option equipment on the car. There was nothing particular. It is a 5 speed manual car, which I saw and the only item besides color to influence the purchase if you are in the market for one of these.

Comments: Initially I did not expect to find the second generation xB. In fact, I thought about pricing a new one on Scion's web site to see if it would be possible to get one new under $15,000. A quick check of Scion's web site shows the base price of an automatic xB to be $17,475 base, and with a few carefully selected option I came up with a final price of $18,108.

This car seems like a reasonable alternative to a new car. Save $3K for getting a car with about $11K miles. However, this car has a manual, if that's important to you. I tried to select cars with automatics as much as possible on the assumption the car would eventually go to a child reaching driving age.

2008 Scion xB, 11,795 mi., $14,777

KBB Retail: $18,465

Description: Again, the ad's description listed all the equipment on the car. This one has a little more mileage for a few dollars less than the blue one above. Most important for many people is this one has an automatic. This could be an issue if you were looking for an inexpensive car to use that could be passed on to a child as there first car in a few years.

Comments: Here is an automatic equipped xB. The color is surely not offensive, but lacks spark. I like the blue one above better, but I wanted to make sure I got an automatic in this mix to compare to the auto equipped xB I priced on Scion's web site. Either way, this car or the one above seem like reasonable compromises from a new car.

2006 Scion xB, 29,454 mi., $13,984

KBB Retail: $14,220

Description: Even a few years old and they are just listing equipment. Nothing noteworthy in the ad's description. This car had an automatic.

Comments: When I started this column I expected to find many more of the first generation Scion xB at a wider range of price and mileage. Maybe it takes more looking, but on the day I found all these xB's I would have a tough time not paying $14K for a 2006, which another grand gets me a 2008 above.

2006 Scion xB, 21,500 mi., $12,500

KBB Retail: $14,470, Private Excellent: $12,370, Private Good: $11,670

Description: One owner, Looks & runs great, All scheduled maintenance, Maintenance records available, Low mileage, Never seen snow, No accidents, Upgraded sound system, Custom wheels, Wheel locks, Fog lamps, Rear window defrost, Remote keyless entry, Rear cargo cover, Arm rest, Molded dash applique, Rear spoiler, Carpeted floor mats/Cargo mat, Auxiliary audio input jack, Cup holders, Extended warranty just purchased for 5 years/60,000 miles and is fully transferrable, Price negotiable.

Comments: I cheated on this one. With the lack of xB's found within 100 miles of my zip code I reached out and found this one 162 miles away. This is more what I hoped to find. It is priced very attractively and it is from a private seller. Perfect if you don't have a trade and can secure financing on your own. The transferable extended warranty clinched the deal for me. BTW, this car did have an automatic.

Since he outright tells us the price is negotiable I looked this one up on Kelly Blue Book (http://www.kbb.com/). I did NOT mess around with options on KBB, I went with the default. Just plugging in the year, model & mileage and KBB gave me a trade in value of $10,225 for excellent condition. The private sale value was $12,370 and the retail value was $14,470, again all for excellent condition. He seems to have priced it just about right. However, he is selling it because he doesn't want to trade it in. Why? Well, most likely no dealer would offer him more than KBB's "good" condition value on a trade, which was $9,625. We can take advantage of that. I would offer him $10,500 initially and try to get it for no more than KBB's Private value for good, $11,670. I think that's possible. I entered this into the spreadsheet at the asking price of $12,500.

2006 Scion tC, 21,169 mi., $14,882

KBB Retail: $15,615

Description: This is one of the hottest vehicles on the market right now and this one is as nice as any of them. This is a super clean one owner trade in that has been very well maintained. We have put this vehicle through our rigorous safety inspection and it passed with flying colors.

Comments: The tC is a more difficult car to shop online for. I wanted to find the least expensive one, but that car had a HUGE wing on the back as well as a lot of tape graphics. I would have a dealer remove the graphics, but the wing will leave holes in the deck lid, so why bother. The nest lowest has some unusual aftermarket wheels. Not my cup of tea. So I just went with the one in my favorite color, blue.

2006 Volkswagen New Beetle 2.5L, 16,841 mi., $14,900

KBB Retail: $14,970

Description: This vehicle comes with Volkswagens 2 year/24,000 mile Certified Pre Loved Warranty with ZERO deductible!

Comments: That is so nice, they offer a 2 yr/24K Pre Loved warranty. But the factory warranty goes to 36K miles, so this 24K warranty will only get you an additional 841 miles. Joy! Regardless, I was surprised how few Beetles I saw out there. I only found 2 within 100 miles on the day I did my search. And both were 2006 models. I guess it is the mileage/price that limited how many showed up.

I did broaden my search to mileage under 45K, and saw a 2006 Beige Beetle with 32K miles listed for $12,888. The description mentioned, "One owner, Still under factory warranty, Well maintained. We love our BUG but no room for new baby." Too bad it didn't include a photo or I would have listed it separately. But the new baby means they are desperate to get rid of the car, so I would do the KBB trick like we did with the xB above and low ball an offer.

2004 Volkswagen New Beetle GLS, 42,360 mi., $10,399

KBB Retail: $11,455

Description: The ad just listed all the standard and optional equipment. Nothing noteworthy.

Comments: I know, this car is over the mileage cap we put down on this month's criteria. I was curious. When I changed the mileage criteria to 45K miles to find the Beige Beetle with 32K miles mentioned above I also saw this one. This was the lowest priced Beetle with less than 45K miles that showed up in my quick search. I did NOT include it in the spreadsheet, but had I the monthly payments for this using all the other criteria would be $206.22/month. If you go this route you should save some cash for repairs. You never know.

2006 Mini Cooper, 30,716 mi., $14,950

KBB Retail: $19,520

Description: The usual list of equipment with nothing special listed.

Comments: This was the best I could find in a Mini Cooper. I was a bit suprised. The Mini Cooper comes with a factory 4 yr/50,000 mi. warranty, so we can up the mileage on these cars. I did that, but still didn't find anything not out of warranty. This is probably due to cost. Mini Coopers are not cheap. By the time they get down to $15K they are more than 4 years old or have lots of miles. Notice Kelly's retail value for this car is pushing $20K.

I also had to cheat and go out to 163 miles for this car. I found another white one that had another 10,000 miles on it but included the Xenon headlights. Notice this car is probably the only car to have leather seats... unless that is leatherette (leather from plastic cows). If you can get past the year or mileage there are a LOT of Cooper S models out there. I saw plenty with reasonable mileage but in the sub $15K price range they were all 2003-2004 models putting them out of factory warranty.

2004 Mini Cooper John Cooper Works, 72,300 mi., $14,950

 

KBB Retail: $19,175

Description: John Cooper Works Package! There is no comparison to a JCW Mini for the combination of performance, fuel economy, and FUN. This car is immaculate, inside and out and has just over 71k highway miles. The John Cooper Works package (No. S3239 w/ signed certificate from Mike Cooper) is a factory option that costs more than $5000. *210 BHP (standard S has 163 BHP), rated at 140 MPH *Enhanced Eaton supercharger w/revised pulley system *High performance head *Re-programmed ECU to match all components *Stainless Steel exhaust system (sounds great) *Cold air intake and intercooler. Some other features of this car are: dual panoramic moon roof, Harmon Kardon sound system (w/steering wheel controls), factory IPOD connection, Xenon headlamps (w/power wash system), nearly new Z-Rated run-flat tires, 17" wheels, climate control system, Sport Package, Premium Package, on-board computer (ext. temp, speed, mileage, fuel range, avg speed, etc.), new battery. Kelley Bluebook Suggested Retail = $21,000. You won't find a cleaner Mini!

Comments: O.K. I cheated again. This car has well over our 30K miles. However, we are allowed some leeway with the Mini Cooper as it comes with a factory 4 yr/50,000 mi. warranty. Yea, this breaks that too. But I still miss my 06 Mini Cooper S Convertible. I don't want a convertible anymore and when I looked for Mini Coopers under $15K this was the first thing that showed up. And it is from a private seller. So we have negotiating power right up front.

KBB's Private Sale value for Good condition is $15,940. The trade in value for the JCW in good condition is $13,175, so we have some room to negotiate. I would try offering $13,400. This is $1,500 less than he is asking and probably enough to keep him from giving up and running to a dealer to trade it in. The difference between his quoting of Kelly Blue Book and mine could easily be due to options. I went with the defaults with the only option being the JCW package. I did not want to get into an issue of trying to figure out what options a car had or didn't have.

Because I cheated with this car I did not include it in the spreadsheet.

2006 Pontiac Solstice, 45,833 mi., $14,992

KBB Retail: $16,940

Description: Qualifies for the GM certified 12 month 12k mile extended bumper to bumper warranty and 5 yr 100k mile powertrain/drivetrain warranty.

Comments: We are not cheating here. The mileage is high, but they are providing an extended warranty. This was a certified car at a Pontiac dealer. KBB lists the car at a Retail value of $16,940. They are selling it for $2K less. That's impressive. You should have seen all the info about this being an Internet sale and only an Internet sale. I can see why.

I am not looking for a convertible, but there is no reason you could not look at a convertible if you are single or something. This might make a cool car for the money. Though I suspect its value will drop faster than a Miata.

2006 Mazda Miata MX5, 24,742 mi., $14,995

KBB Retail: $16,565

Description: Just the usual list of features and mention that financing and warranty are available.

Comments: I really like this car. If I was in the market for a convertible this would be at the top of my list. With two sons to chauffeur around I don't think I could pull off a two seater for sole transportation. But it is soooo tempting.

I did find a 2003 Miata with only 25,500 miles for $13,000. That is too old, but it might be good enough for someone. I also found a 1999 Miata with just under 30K miles for only $8,900. That could make for a great daily driver if you don't mind taking a chance with possible repairs. The money saved could be put in the bank for that chance.

One last thing... all the convertibles, including the Solstice above, were equipped with manual transmissions. If that interests you.

2007 Ford Mustang V6 Coupe, 27,831 mi., $14,982

KBB Retail: $15,780 - $15,515

Description: Nothing was mentioned worth repeating. I was curious, though. Does this have a leather interior. I can't tell if its leather or vinyl from the picture. Since it is not a convertible I suspect it might be leather.

Comments: I saw a dozen or so V-6 Mustangs in my simple search. I limited the Mustang search to automatics. Hey, a car like this might get passed on to a teenager. There were a couple with less mileage and cheaper than this one, but this car looked the best. I like the dark gray color and this was the only car with the V6 Pony Package (as noted by the fog lights). Because it was obvious this car had the Pony Package I gave it credit for it on KBB's web site. That only boosted the value by $265. Well worth it in my opinion.

2008 Nissan Altima 2.5 S Coupe, 31,000 mi., $12,750

KBB Retail: $18,050

Description: Great Graduation Gift!! Highway miles, No accidents, Non-smoker, One owner, Runs & drives great, some hail damage, overall well maintained.

Comments: I was surprised to find one of these. Oh yea... I cheated. The mileage is slightly over the 30K limit and I had to go out to 492 miles to find this car. But this car is pretty new, and 08 Altima Coupes are not flooding the market at my price point. This car was being sold privately, so I assume he is not getting what he wants for it in a trade. He is listing in well below Kelly's retail value of the car. However, he is right at KBB's trade in value in good condition, $12,725. The hail damage would probably rank this at a book value closer to the fair condition. hat drops to $11,075. So maybe we can bargain on this car. Since I would not travel 500 miles for a regular car, no less one with hail damage I left this off the spreadsheet.

2007 Honda Accord LX Coupe, 17,351 mi., $14,990

KBB Retail: $17,590

Description: Nothing special noted. In fact, almost nothing mentioned at all.

Comments: I wasn't sure my tight search criteria would return many Accords. I found 2 within 100 miles with less than 30K miles and 2005 or newer. This one and the sedan below. This might be the prize of this article. It was listed as a certified car at a Honda dealership. Yet they have it priced well below Kelly Blue Book's Retail value. And it is a Honda. This is definitely worth looking into on that certified deal. And this would make a great first car in a couple of years for a teenager.

2007 Honda Accord SE Sedan, 27,200 mi., $14,750

KBB Retail: $17,225

Description: REDUCED! Very nice car that has extended warranty to 100K miles. Purchased new and maintained at local Honda dealer.

Comments: I like this body style to the new for 08 Accord in sedan format. The 08 Coupe is very cool looking, but the 08 sedan is ugly. This could make a great car for a family with a kid close to driving age. A perfect hand me down in a couple of years.

This is from a private seller. You know what that means, we need more KBB research. Kelly says the trade in on this car in good condition is $12,175. Looks like he is pricing it right between what a dealer would sell it for and what a dealer "should" give him for it. I believe we can always beat that. I would start with an offer of $13,000 as a start. I really like this car at $13,500.

2006 Honda Civic LX, 14,013 mi., $12,891

KBB Retail: $16,205

Description: Need peace of mind? No worries with this purchase, it includes a Carfax Title History report. No, your eyes aren't deceiving you. That is the correct mileage! *** Call the internet department today to test drive!

Comments: What's wrong with this picture? A dealer is selling a car for $3,300 below Kelly's retail value. Is there something wrong with this car? Well, the warranty is going to run out any month now, so I guess that's the only issue we can determine from an ad and a picture. And this is one of those Internet only specials. This car is the mileage champ in out search this month. And it was second by only a few hundred dollars of being the price champ as well. This is less cool that an Accord Coupe, New Beetle, or even a Scion xB. But it should be a great little car to get around in... if you are trying to save money for a classic car. Hmmm!

Conclusion

I got tired doing this. I did ALL the research for this article in two days of web surfing. I did some more checking and I saw a pair of VW Jettas, a 2007 and a 2008 model, each with under 15K miles. If you really want to pinch pennies you should use my criteria on the Toyota Corolla. Looking for 2006+ with less than 30K miles within 100 miles of my zip code AutoTrader spit out 92 matches under $15,000. I was also able to find a few Camrys. I was trying to avoid boring cars, and Toyota is the king of boring.

If you are doing this for real you might want to increase the price you search for. I was tempted to see what would be available for $16,000-$16,500. This would assume being able to negotiate the final price down to the $15,000 mark.

I think I made my point. I have sedans, coupes and convertibles listed above. Almost every car here is still under warranty and all could be yours for no more than $300 a month. If you can swing that then take a close look at the used car market in your area. It might be fun. Hopefully it is more fun than buying a new Honda Fit or other cheap car.