Worst luck with used cars...now what?

[rk911]

Hi ER,

I've always believed in purchasing used vehicles but the last few have been a bust.

BMW 525 wagon: 140K miles, bad oil divertor valve, engine flush. $1200 repair. Sold.

Nissan quest van: 60K miles, replaced motor mounts, failing transmission, got side swiped and thankfully received a replacement check. In car heaven.

Current car inventory:

1. 2007 Toyota 4 runner, bought at $8.7K, currently 165K miles, failing rear diff. Repair estimate $1200. Local market value $7K+. Car fully paid for.

2. 2008 Lexus LX570, bought at $26K, 83K miles, chased and poured $4K diagnosing and repairing a persistent transmission issue (intermittent reverse gear not engaging). Got 2nd opinion from another shop and it turned out original repair shop was incompetent and filled 1.5-2.0 qts low on tranny oil. We used trans-x oil as an interim fix but local transmission shop advised us that we will be seeing eventual transmission failure and should expect a rebuilt tranny repair bill north of $3K. Local market value $23K. Car loan balance $13K.

I've read on other threads on ER.org the conventional wisdom is repair bills are better than car payments and if repair bills are less than 50% of car value, then go ahead with repair and keep.

Should we repair and keep or move onto another vehicle?

Thoughts?

Thanks!

if you're gonna buy then buy new and pay cash. no payments is a good thing.

 

[jazz4cash]

There is frugal and then there is cheap...this list wasn't too awful until the tire comment..Good way to kill yourself or some other innocent soul.

+1. In addition to the safety issue, it’s illegal to drive on bald tires and takes the joy out of driving.

 

[teejayevans]

Bald tires hydroplane easily. I'm not the safety police, but I certainly wouldn't drive on bald tires.

Reread my post, I said “nearly bald”, but I didn’t do the penny test.

I also said I used them for city driving and short trips...so no highway driving in the rain.

 

[teejayevans]

+1. In addition to the safety issue, it’s illegal to drive on bald tires and takes the joy out of driving.

I said “nearly bald”, the tire that failed actually had the most tread and would have passed the penny test, it was a full spare that I rotated in to stretch the life of the set.

 

[Koolau]

I basically drove my last car (VW) until it fell apart, spent $2k over 7 years, mostly on a bad water pump. Had 174k when I gave away. At the end my list of problems:
Oil leak
No heat, no A/C
Radio worked by display didn’t
Plastic was breaking, glove compartment fell out
2 windows broken
Driver seat leather was badly torn
Computer display didn’t work
Exterior was bad shape
All tires nearly bald, finally 1 split...the final straw.

If I tried to maintain it and fix all the above problems, it would have cost me $15k+.

I only used it for city driving or short trips. Trying to maintain old cars gets expensive, I think it’s best to have a nice new car, and then a beater car. You can keep the new car nice for a longer time. When beater finally dies, demote the former new car, then buy another new car.

Heh, heh, sounds like my 22 year old CRV - daily driver - well, used to be before Covid, but that's another story. I took it in to the repair shop with best reputation in town - for an oil change. That was 2 years ago. I kept asking them why it was taking an hour, 2 hours, 3 hours for an oil change. When they presented the bill, they also gave me an estimate to fix all the stuff that was wrong with the car (oil leak, struts, bushings, boots, etc., etc.) It was almost $3K - WAY more than the car was worth, considering the body is rough, the radio doesn't work, the AC is "weak," etc.

I keep good tires on the car, keep the brakes in good shape, but otherwise, I only change the oil - don't detail (or wash it.) The car still works fine for my needs.

Oh, and back to the OP for a second, I bought the car used 12 years ago. I guess I'd say I've had good luck, all things considered, but YMMV.

 

[DrRoy]

We have helped our sons find used cars over the years, with mixed results. So far, a 2006 Honda Civic has done the best. The most recent one was another Civic for the other son last month, a 2017. Hoping it lasts a long time. We have bought new for ourselves since the 80's.

 

[cyber888]

if I can afford to, I plan to retire with an RS6 Avant .. 3.1 seconds 0-60 ... combines sports car power with functionality

 

[pjigar]

Used cars are best if you can fix them yourself. Otherwise your best bet is to keep renewing them at 100K to avoid repair costs: used/new. I fix my own cars and I have been buying higher milage cars as my experience and confidence goes up. Last one was a Honda Accord with 130K miles ($3K purchase and $500 parts). I replaced motor mounts, head lights, AC compressor and lines, fluids, brakes, fix vacuum leak, etc. etc. It is a great ride now for next 30-50K. My only checks for used cars: No visible frame damage/tinkering, No leak under engine or transmission, no codes in computer that I can't fix! I look for simpler (i.e. mechanically) with room under the hood to work which is getting a lot harder as we create more advanced cars.

 

[BigMoneyJim]

I think the "trick" to cheap used cars is to buy boring (or at least very common) used cars.

My first car was an old Volvo, and a few cars later was a mid-70s Fiat. Being less common and Volvo being a luxury or at least elevated brand, parts and labor (when needed) were just more expensive. (The Fiat was just uncommon to everything and needed expensive parts and silly special tools such as a 12.5mm (!) allen wrench to change the oil. I bought a used 13mm allen wrench and filed it down until it fit.)

Since then I've avoided "interesting" cars, and somewhat unintentionally the vast majority of my cars' colors have been particularly colorless white, beige or silver. And one brown and a couple old faded blue. But I'm pretty sure that's because there are better deals in common, dull, boring cars.

So *I'd* stay away from BMW, Lexus, or other "fancy" / concierge brands. But others seem to like getting a used luxury car and maintaining it.

Some people talk about depreciation and some cars holding value better, but I'm more interested in total cost of ownership and some combination of maintainability/reliability.

When I was younger I would get cheap cars and maintain them myself for the most part. The past 3-4 cars I tend to buy 2-4 years old and keep 4-6 years which seems to fall in my sweet spot of no longer wanting to do any maintenance myself and wanting a reliable car that needs few if any mechanic visits.

Which leads to the other trick: exit strategy. Some cars may retain value better, but only if they're maintained. Usually when I'm tired of a car's increasing issues I don't want to fix it up to sell it; I'm ready for it to be someone else's problem. That's not a recipe for getting that residual value.

So I guess I'm doing a variation of "driving it into the ground" except I'm letting someone more motivated than I to get a bit of a deal on a fixer-upper to finish driving it into the ground.

And then I buy my next boring car. I'm not looking for the best deal at purchase time or sell time; I'm looking for the least hassle.

Last I checked, I generally pay about $2500/year for cars, purchase price and maintenance combined. (Averaged out over time, and honestly I haven't checked in a quite a few years so it's probably higher now.)

Edit: I've also generally had the best luck buying (or in one case, given) used cars opportunistically from family. But most of my cars are from used car dealers, and the last 2 or 3 I'm pretty sure were off-lease ex-rentals.

 

[pb4uski]

When I was buying used cars I always tried to buy with at least a year and 12k miles remaining in the CPO warranty or manufacturer's warranty... so that generally meant a couple years old with less than 24k miles unless there was CPO coverage.

My reasoning was that if there was a real flaw with the car that it would likely show up within 12 months or 12k miles.

 

[Teacher Terry]

We buy 2-4 certified used cars from the dealer and keep them until they get to expensive to repair. We bought one Volvo and it was so comfortable but too expensive for repairs. We have had much better experience with our Honda Accord and Toyota Corolla. The Toyota we bought with low miles from a friend when she couldn’t drive anymore.

 

[troutnut1]

Thomas Stanley in the book “Millionaire Next Door” had a lot of interesting observations about what real wealthy people buy in the way of cars. And I found it was pretty much what I have been doing all along. Might want to google that or buy the book. We don’t see many BMW’s or Lexus here in Montana...and when I do it’s got out of state plates.

 

[ArmchairMillionaire23]

There are a lot of reliable used vehicles but when you're talking about cars made in 2007 and 2008 then they're probably nearing the end of their useful life.

My general rule is to buy something 3 or 4 years old with low mileage and keep it for 5 to 7 years. For me, that's the sweet spot of ownership...someone else takes the depreciation hit, I get a technologically updated car with lots of life left, and I get rid of it before major things start going wrong.

My general rule is to buy a small GM truck with a manual transmission when it's about 5 years old and then drive it for about 15 more years until either the frame rusts to the point that it cracks or the cab rusts to the point that the doors start unlatching and swinging open when driving around corners. (That's when I know it's time to look for another used truck. ) I find I can get between 90,000 and 100,000 miles between brake pad replacements if I downshift my way to stop signs and red lights. (if the calipers don't rust shut and wear the brakes prematurely, that is) I can usually get 50,000 miles per set of tires. I've never had to replace the clutch in a small GM truck as the trucks have deteriorated from rust before the clutch ever wore to the point that it needed replacement.
I bought a '95 S-10 with 65,000 miles on it in 2000 for $6,000 and drove it daily until I sold it in January of 2016 with 276,000 miles on it for $500 to a guy who said he was good at welding stuff back together. In December of 2015 I bought a 2010 GMC Canyon with 84,000 miles on it for $8,000 and I plan on driving that until at least 2030. It's got 123,000 on it now and it still feels like a new truck to me.
My wife's previous car was a '99 Ford Escort that she bought used in 2005 or so and kept until 2016 when it was starting to get pretty rusty. Since she has to drive to her job in the winter I wanted to get her something with decent traction and stability control (she was adamant she didn't want any type of SUV and wanted a small car) so we found her a 2015 Chevy Cruze in 2016 with about 20,000 miles (program car). It has an automatic transmission but that's what she likes to drive. We had to replace the ignition coil module and plug wires at just over 36,000 miles (just after the warranty expired - how convenient for GM) but I ordered the parts from Amazon and did it myself in about a half-hour for less than $100 including new spark plugs. The Cruze has almost 50,000 miles on it now and we plan on keeping it until it either rusts out or becomes too expensive to repair relative to the value of the car.
I know most people on this site love their Toyotas and Hondas but we (I) prefer GM vehicles due to the ease of repair and low cost of replacement parts. Plus we have two Chevrolet dealerships within 10 miles of where we live. There's also Ford, Chrysler and Toyota dealerships within those 10 miles but the local Ford and Toyota dealerships are notorious for abysmal customer service and shoddy workmanship and neither of us wants to deal with the hassle of owning a Chrysler product.
If we ever wanted anything other than GM, Ford, Chrysler or Toyota we could drive 50 miles to a VW dealership or we'd have to go 100 - 150 miles to find anything else.

 

[Mr._Graybeard]

View attachment 35603 if I can afford to, I plan to retire with an RS6 Avant .. 3.1 seconds 0-60 ... combines sports car power with functionality

A nice car I wouldn't own outside of the warranty period or a lease. The Porsche Panamerica has proven to be pretty reliable for a supercar, especially one built by Volkswagen AG.

 

[2cheap2eat]

There actually are some great car deals if you shop around. Used car demand has gone way up, probably due from covid and people not wanting (or able) to buy new. I was shopping for a certified used SUV, and ended up getting a new Jeep Cherokee Latitude (middle tier) for $26k including tax & title.
Point is, if you shop around, you can find a lower mileage or maybe even a new car. Compare no repairs, reliability and safety features vs the models you have been purchasing.

 

[tizod]

I'm a big fan of Genesis. Great used $$ and really a great car with reasonable repair costs. A bit eclectic so local garage might be surprised, but when they get into it its a typical car. My 2009 had 150K low maintenance. If going used and need CarPlay be careful of what you can get. Some years the Ultimate cannot support it (screen size). Ultimate is a great deal.

 

[azxracer]

If you're gonna buy a used car and you're not handy with fairly complex car repair methods (including more than basic tools in your tool box) I would suggest a pre-purchase inspection. Find a reputable shop that has experience with that model if you aren't sure what to look for or how to evaluate what you find. It may cost $150-250 dollars but it's money well spent to weed out potential problems. Put the vehicle on a lift, pop the wheels and check the brakes, the suspension, look for leaks, frame or underbody damage, unexpected corrosion. Maybe do a compression test, even a borescope of cylinders might be a good idea if there are known issues with that model. The shop will be able to check TSBs and recalls and give you a list of things that could be potential trouble issues.

 

[Al in Ohio]

Hi ER,



I've always believed in purchasing used vehicles but the last few have been a bust.



BMW 525 wagon: 140K miles, bad oil divertor valve, engine flush. $1200 repair. Sold.



Nissan quest van: 60K miles, replaced motor mounts, failing transmission, got side swiped and thankfully received a replacement check. In car heaven.



Current car inventory:



1. 2007 Toyota 4 runner, bought at $8.7K, currently 165K miles, failing rear diff. Repair estimate $1200. Local market value $7K+. Car fully paid for.



2. 2008 Lexus LX570, bought at $26K, 83K miles, chased and poured $4K diagnosing and repairing a persistent transmission issue (intermittent reverse gear not engaging). Got 2nd opinion from another shop and it turned out original repair shop was incompetent and filled 1.5-2.0 qts low on tranny oil. We used trans-x oil as an interim fix but local transmission shop advised us that we will be seeing eventual transmission failure and should expect a rebuilt tranny repair bill north of $3K. Local market value $23K. Car loan balance $13K.



I've read on other threads on ER.org the conventional wisdom is repair bills are better than car payments and if repair bills are less than 50% of car value, then go ahead with repair and keep.



Should we repair and keep or move onto another vehicle?



Thoughts?



Thanks!

My limit for repair cost would be a maximum of 10% of current car value. Anything higher than that I consider selling. At 20% of value no way I keep the car unless its under 2-3 years old and prestine.

 

[stephenson]

Some cars require either money or expertise - some in large quantity of both.

If one is buying used cars (without warranty), by someone who doesn’t work on cars, they should be of more than average reliability.

Lexus - no
BMW - no
Nissan - no
Volvo - no
VW - maybe
Toyota - yes
GM - surprisingly yes

 

[gooddog]

Have always bought new cars to save money, and it has worked. Dump all the problems on someone else, and go buy a decent new car. A Jeep can be had for 20k, a Ram pickup can be had for 21k. Just got to take your time to get the good deals.

 

[stephenson]

Really? Those are interesting prices.

 

[Out of Steam]

Maybe revisit your belief in used cars? They'd don't seem to be returning the favor.

You can get a lot of nice in a new car for around $30k, and then have a warranty for a few years.

With a couple of exceptions (one good, one expensive) I've been a new car buyer, keeping them 100K or more miles. Unless a car is reliable, but unpopular, I find used car prices to be crazier than new car prices.

If you calculate economic life as 150K to 200K miles, 50% of new price for 30% of remaining vehicle life seems common. Yes, I know that a long-term owner with a good mechanic or a dedicated DIY can keep a car longer.

Also, if you're going to be hosed with every transaction, it's best to minimize the total number of transactions.

 

[ivinsfan]

Some cars require either money or expertise - some in large quantity of both.

If one is buying used cars (without warranty), by someone who doesn’t work on cars, they should be of more than average reliability.

Lexus - no
BMW - no
Nissan - no
Volvo - no
VW - maybe
Toyota - yes
GM - surprisingly yes

is this a personal list? we've had a Nissan for 8 years and a lot of miles and had one 1200 repair two years ago...

 

[Hibernian]

There are a lot of reliable used vehicles but when you're talking about cars made in 2007 and 2008 then they're probably nearing the end of their useful life.

My general rule is to buy something 3 or 4 years old with low mileage and keep it for 5 to 7 years. For me, that's the sweet spot of ownership...someone else takes the depreciation hit, I get a technologically updated car with lots of life left, and I get rid of it before major things start going wrong.

This.

I only drive used, always buy a 3-4 year old luxury model that someone else has taken the depreciation hit on, and then usually from a dealer that offers some warranty on roadworthiness (Carmax or dealership etc.).In this way I've had the joy of driving some great cars at lower cost.

Personally, I would not buy anything from Nissan, but that's my experience (I could add a few more to that list) and I'd be wary of a BMW with the mileage listed by the OP, though he did not give a year so maybe it was bad luck. I do not feel there's any special credit given for driving a car to 200k miles and I do pay attention to the reliability ratings of CR etc but even then, I still bought, and enjoyed, a Jag

For the OP, I would keep the Lexus if you like driving it. I loved owning one and it was super reliable and had the lowest maintenance cost of any vehicle I owned. But I factor in at least $2-3k a year as the basic cost of maintaining any car (excluding gas, tax, insurance etc). Some years less, some more, but I try to average it out at that rate. Once the costs start to go above this, I make a decision to change or stick for another year. I'd love to do my own maintenance but I'm never going to get into that level of equipment and effort at this point.

 

[stephenson]

Ivinsfan,

It is my personal view

Didn't mean to offend - and my comment was certainly a generalization, but I have had lots of friends buy Nissan and then (usually north of 50K miles) ...