Common Facts about Used Cars That Are Under $5000
Used cars under 5000 dollars are plentiful, but they may not always be a bargain. In fact, consumers should exercise extreme caution when looking at vehicles under $5,000. Here are some facts to consider.
Data from the R.L. Polk Company shows that the average age of U.S. cars is up from 9.2 years in 2008 to 9.4 years this year. Compare this to an average 8.3 years in 1999. Asked why, 39% of respondents told Polk the vehicles were still in good condition. This means there are potentially a lot of good used cars under $5000 that could be for sale.
Problems Likely with High-Mileage Vehicles
The average miles for cars are 12,000 miles per year. Anything over that should run up a red flag. Used cars under $5000 with 100,000 miles on the odometer are generally pretty well used up. High mileage reduces a used car s value by thousands.
Clunkers and basic transportation are often sold by dealers with an as is sticker. Federal law requires dealers selling as is vehicles to have a buyer s guide listing if there is a warranty and what the dealer s obligations are. As is usually means problems.
Vehicle History Available for All Vehicles from 1981 On
Whether you re looking for used cars at dealers or used cars for sale by owner, experts in buying used cars recommend that potential buyers obtain a vehicle history on any used car they re considering. All used cars under $5000, no matter how many miles, will have a vehicle history report (available from Experian s AutoCheck and from CARFAX) except for vehicles prior to 1981. No clear title reports exist for cars before 1981 the year manufacturers went to the 17-digit vehicle identification number (VIN).
Many banks and lending institutions won t lend money for cars that are more than 5 years old. This includes many in the pool of used cars under $5000. The reason is that when cars are too old and have too many miles, they re riskier for lenders.
With the numerous hurricanes and natural disasters in the U.S., thousands of flood-damaged and salvage vehicles appear in the used car market. If considering one of these vehicles, buy a vehicle history report, get an independent vehicle inspection and know exactly what you re getting into. Buy an extended warranty if none is available from the dealer. Avoid any private sale flooded or salvaged vehicle that has been in an accident (which will show up on the vehicle history report).
Banners touting that used Honda Civic for $5000 or trucks under $5000 may be worth a look if you re prepared with a vehicle history report and to get an independent vehicle inspection. If the car is 3-years old and has had 3 owners, that s a red flag. Steer clear.
Clear Title Doesn t Mean the Car Never Sustained Damage
One point to remember is that a clear title does not mean a car was never in an accident or sustained damage. When searching for used cars for sale by owner, it pays to always buy a vehicle history report to determine any prior accidents.