Tips on Buying Cars: Inexpensive new car

Question
QUESTION: My family's current financial situation is not good, but our credit fair to good. My wife does a lot of driving on her job and desperately needs a new car. What is the cheapest, but reliable small to midsize new car she can buy. Also, what's the best way to make the purchase with no frills, etc? Thanks for your time.

ANSWER: Hi Ed ...believe me there are very few people cutting a fat hog these days which reminds me of Winston Churchill's famous quote about socialism and collectivism which we are all being pushed into kicking and screaming...  He said:

"Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery"

I think we are all sharing the misery ...BUT politics aside you asked about a car...

For starters you have to buy a car you like looking at, being seen in and driving or you wont want to make the payments on it. That said...I would not buy a new car and unless you feel strongly about being the one and only owner of the car I would personally (as in if it were me) look around and find a current model year preowned 'certified' car or a CPO for certified pre owned ...the car I would buy would have 7000 miles on it or less and the dealer would have just done the 160 point inspection on it and certified it and along with the certification the car would have a better warranty than a new car because the power train part of the warranty gets extended to 7 years or 100k on CPO's. CPO's also qualify for a sub-vented factory supported interest rate of something like 2.9% for 60 months.  So you save money on the car ...don't have to buy an extended warranty (if you normally would) get cheap financing and a fully inspected car!! :) Sounds perfect right?

The financing goes through the captive lender so if its a certified Ford that means Ford Motor Credit Corp and if its a Honda then Honda Financial and for Toyotas; Toyota Financial. These rates will usually be given to Tier I and Tier II buyer with just a minor (a few extra points of interest for Tiers III and IV. My suggestion is to go to your credit union and if you don't have one then join one and get your financing handled there before you shop.

Now what automakers have THE BEST CPO programs? Well if you said Porsche then you were correct lol but the best CPO programs for what you are wanting would be Hyundai, Kia, Toyota, and Honda.

The best bang for the buck combined with the best fuel economy right now is probably the Hyundais. Just know that when this car gets to be 7 yrs old it will basically have no discernable value.

Check those out and get back to me with any and all follow ups I will stick with you until you are completely satisfied and ready to attack a car deal!

Roger
The Car Guy



---------- FOLLOW-UP ----------

QUESTION: Roger, I agree with you and Winston Churchill 100%. One question on CPOs. If I go that route and want to buy a Hyundai, are you saying I should go to a Hyundai dealer or will the CPO program be similar if I buy a Hyundai from Carmax or someplace similar? Thanks again.

Answer
Sorry for the late follow up but you can only buy a certified preowned from a dealer of the same automaker. Auto max can't offer you a true certified preowned experience nor can they extend the factory warranty except thru the use of add on coverage ... That said they do have a certified program that is better than nothing but lacks the rigorous inspection by factory trained technicians