How to Buy Used Cars Under $5,000
Updated January 1, 1 . AmFam Team
It’s no secret — cars can get expensive. And if you’re trying to cut costs and stick to a monthly budget, cutting your car payment down to size can help you sock away a lot of cash. If this sounds like a good idea, it may be time to think about purchasing a reliable, inexpensive used car.
Buying the right used car for around $5,000 is all about getting detailed service records on the car and sleuthing out answers when inspecting the vehicle with the help of a mechanic. How do you source reliable used cars that are going to last? Take a look at our answers — we’ll help you find the best cars for under $5,000.
10 Tips on How to Find Used Cars Under $5,000
If you’re looking for a no-frills ride to get you from point A to point B reliably, you don’t need to buy a new car. Finding the best used cars under $5,000 isn’t hard if you know what to do. These tips on how to buy a used car can help you find that diamond in the rough:
Tip 1. Search for single owner cars — sold by owner
Try to find a private seller who’s owned the vehicle since buying it new. Low-cost cars that are high in miles typically last because the car’s been relatively well-maintained. You’ll find most vehicles owned and sold by a single owner are in relatively good shape. That's because they've been willing to take the time to care for their car and elect to sell it on their own to help ensure it goes to a good owner.
Tip 2. Search for base model vehicles
Although you may not get a V6 engine or satellite radio, there’s less to go wrong in a car with standard features. And that can translate into cheaper repairs and reduced maintenance costs. Luxury cars may be fun to drive, but they’re rarely fuel-efficient and can get expensive to maintain.
But don't discount your own needs. Look for used cars that have creature comforts and make your drive safer. Options like cruise control, power windows, a roomy rear seat and front wheel drive for better winter weather handling. Cars like the Honda Civic, with front and rear air bags and anti-lock brakes offer a lot of value for the money.
Tip 3. Get the facts on the car’s history
Educate yourself about the car by requesting a CarFax or another third-party vehicle history report. With one in hand, you’ll get details on the car’s accident and maintenance history. These reports are a great means to verify mileage of the car because you’ll be able to see many of the maintenance details. That little odometer reading can be cross-checked against the seller's service documents.
Another key reason to have a car history report is to help verify overall car value against others on the market just like it. Some reports fold in pricing data from Edmunds.com or Kelly Blue Book resale value database, which can help you understand whether the car your considering is priced correctly.
Tip 4. Search online carefully
Build a list of keywords for searching craigslist.org or carfinder.com that can help you find used cars under $5,000 worth buying. Think about your ideal seller, someone who’s taken great care of the car and paid for extra services that extend the car’s life, and search for cars with terms like:
- Undercoated
- One owner
- Highway miles
- No rust
- Regular oil changes
- Mint condition
- All maintenance records
- No accidents
- Synthetic oil
- Part of the family
- Immaculate condition
- Dealer maintained
- Garage kept
- Keyless entry
- Electronic door locks
- Cruise controls
- Full size spare tire
Tip 5. Go for cars with highway miles
Used cars with verifiable highway miles are a better bet in many ways. They’ve typically seen less wear and tear than their city-driven counterparts. But even good used cars under $5,000 may have issues along the way — that's why it’s wise to pick up emergency roadside assistance coverage to best protect your investment.
To help verify highway miles, here’s what to look for:
- Few signs of wear on the brake pedal
- Stone chips on the hood and bugs in the radiator fins
- A door sill that’s still in good shape
- A driver’s seat that’s in good condition
Tip 6. Work with a mechanic and inspect the maintenance records
The best used cars to buy under $5,000 are those that were well-maintained over the years. Take the car on a test drive and stop by your mechanic to review the car’s condition:
- Verify that the automatic transmission’s fluid levels are good
- Remember: owners who keep all their service records likely take better care of their car
- Have your mechanic perform a quick inspection of the car and ask their opinion on the car’s condition
- Request a printout or email of all service documents directly from the dealer when possible
- Ask if OEM parts were used during repairs and maintenance
- Review tire rotation schedules
- Verify that vehicle recalls are resolved
Tip 7. Choose cars that were dealer-maintained
The odds of good cars under $5,000 lasting several years are better when maintenance occurs at the service department of a dealership. Call the customer service department listed on the records and ask about the car — they may know the owner.
Be sure to compare the factory-recommended maintenance schedule against the owner’s records. If you’re looking at a single-owner vehicle, explore the terms of service on the warranty. Was just the powertrain covered or did the owner get extended bumper-to-bumper coverage? If so, the car might have been serviced more frequently because parts and service costs were covered under the contract.
Tip 8. Avoid cars with accidents
Vehicles that have experienced a collision can suffer structural damage or other hidden issues. And if the car’s been involved in a flood, electrical problems can emerge and cause real headaches. Look at the car history report carefully for details of damage and be sure to the car's title status. If the car is listed as a total loss, learn all you can about the damage before making any commitments.
Tip 9. Estate sales are a good resource
It’s key to be creative when looking around for a cheap car under $5,000. One great way to find that a great used car is to look at estate sales — they’re a good alternative to cheap car lots or used car dealerships.
Tip 10. Japanese and foreign cars last longer
According to zebra.com, foreign-made cars (from Germany, Japan and Korea to be specific) typically outlast their American-made counterparts. But that gap in quality and durability is closing fast in more recent years.
The Benefits of Buying a Cheap Used Car
In addition to finding a great car that will last, there are other financial benefits when purchasing an inexpensive car. Here’s a quick look at a few more reasons to buy one:
- Parts are typically inexpensive
- Lower monthly car payment
- Typically less expensive rates on auto insurance
- Cheaper to maintain
Get the Right Coverage For Your Used Car
Finding affordable coverage is easy with American Family Insurance. Now that you’ve done what you can to keep your monthly car payments low, check in with your agent (Opens in a new tab) and request a quote on coverage that won’t break the bank. Better yet, get an instant auto quote right now! Just plug in a few quick facts about yourself your new ride, and you’ll have a quick insurance cost estimate in no time!
*Discount and savings amounts and eligibility will vary. Some restrictions apply. Discounts may vary by state, property policy form and company underwriting the homeowners policy. Discounts may not apply to all coverage on a property policy. Discounts do not apply to a life policy.
Related Articles
- What Happens When a Car is Totaled?
If you’ve been in an accident and your car takes a serious beating, it may be deemed “totaled” by your insurance company. But what does it actually mean if your car is totaled, and what do you do about it?
Because you need the right insurance in place before you hit the road, we’re going to review important additional protections that really can make a big difference — like rental car reimbursement coverage. With it, when you’re wondering “is my car totaled?” after an accident, you’ll have some peace of mind knowing you can rent a car and get where you’re going.
The two types of insurance coverage you’ll want on your car insurance policy — to ensure your vehicle damage is insured — are collision and comprehensive coverage.
Here’s a detailed breakdown of when a car is considered totaled and what to do if your car is totaled, to help you get back on the road and keep your dreams moving forward.
- Road Trip Essentials & Checklist
You work hard at your job to provide for your family, and you save up your vacation time so you can hit the road with them. There’s nothing better than exploring the world together and making great memories . But the pre-vacation excitement can quickly fade if you haven’t prepared properly.
That’s why we’ve come up with some tips to make your car trip as fun and memorable as the sightseeing itself. Read along, learn what essentials to pack for your summer road trip and be ready for the road ahead!
- How to Prevent Distracted Driving
Sending a text, eating your burrito, applying makeup — what do all of these tasks have in common?
They’re all everyday examples of distracted driving.
As a driver, it’s your responsibility to focus on the road to keep you, your passengers, and other people on the road safe from accidents. We’ve put a spotlight on some risky driving behaviors that we hope can help influence you to keep your focus on the road.
What is Distracted Driving?
Distracted driving is when the driver is doing something that takes their attention away from the task of driving. Any time your eyes and/or mind are taken away from the road, you’re technically distracted, which means an increase in the risk of an accident.
Not all driving distractions are created equal. As you can imagine, some forms of distraction aren’t as dangerous as others. For example, hands-free telephone conversations — although not recommended — isn’t as deadly as other modes of conversation while driving.
The Deadliest Driving Distraction: Texting and Driving
It should come as no surprise to you that texting is the most common distraction while driving as well as the most dangerous. It’s so deadly in fact, that it gets its very own section.
It’s easy for us all to see the dangers of texting while driving, but even with that knowledge, so many of us fall into the temptation of sending off a fast text message while behind the wheel. But even a quick text can have horrible consequences.
Just think, when you look at your phone, your focus is on the screen, not the road; one hand is off the wheel to hold your device, and your mind drifts to the message instead of the task at hand: driving safely.
Why texting is distracting
To put it into perspective, if you’re traveling at 55 MPH and you take your eyes off the road and onto your phone, you’ve traveled about 100 yards – the length of a football field! That’s quite a distance to cover driving “blind.”
The National Safety Council reports that one out of every four car accidents in the United States is caused by a distracted driver who was texting. They also reported that texting and driving is six times more likely to cause an accident than driving while intoxicated.
Let these driving facts be a wake-up call to the extreme dangers of texting while driving.
Is it Illegal to Use Your Phone While Driving?
The truth is that it depends on which state you live in. As of 2020, the Governors Highway Safety Association reports that there is a hand-held cell phone use ban in 22 states, with 48 states banning text messaging for all drivers. Find out the distracted driving laws for your state to ensure you’re following the rules of the road in your state.
It’s always important to know our state laws, and in your state there may very well be no law preventing you from texting while driving. However, for your safety as well as those in your car, and for anyone else sharing the roads with you, it’s best to stick with a firm “no phone use while driving” mentality.
Types of Distracted Driving
The first step to preventing distracted driving is understanding what it is. In a nutshell, anything that occupies your attention while driving is a distraction. Here are a few notable distractors that should be eliminated while behind the wheel.
Checking your GPS
When it comes to directions, we’ve come a long way from the world of fold-up maps. Today, everyone has a built-in navigation system in the palm of their hands: the smartphone. The only problem is that just one quick glance at your phone’s screen is all it takes for a costly mistake behind the wheel.
Your best bet is to leave your phone in your pocket or purse when driving. But if you must use your phone for directions, enable the voice feature so that you don’t have to look at the screen for every turn.
Sifting through your music device
Trying to find the right song for your road trip is just as dangerous as texting and driving. Your best bet is to pick a playlist prior to getting into your vehicle. Or listen to the radio. The key here is to keep your eyes on the road and not on your music device.
Checking social media
Instagram, Snapchat, Facebook, Twitter, you name it – all of them bide for our constant attention. Don’t fall prey to this when you’re driving. That post, tweet, or message can wait. Avoid checking social media when behind the wheel.
Eating behind the wheel
You may be a pro at eating your burrito on the go, but ingesting your lunch while driving is a big no-no. All it takes is one wayward waffle fry to take your attention from the road to your lap. And it’s not just the mess that distracts; it’s the smell, taste, you name it – that makes eating one of the most distracting things you can do while driving.
Other types of distracted driving
There are a few more forms of distracted driving that could cause an accident. If you’re in the driver’s seat, try to avoid these altogether:
- Taking selfies
- Talking on the phone
- Drinking coffee or another beverage
- Putting on makeup
- Using an app
- Loud music
Top 5 Ways to Prevent Distracted Driving
There are easy ways to prevent distracted driving. Try using making these five simple changes distracted driving safety tips to have a safer driving experience.
Use a text-blocking app
There are many apps available that block texts while driving. Several apps exist with different features, ranging from ones that completely block any incoming or outgoing texts while going a certain speed, to apps that will send a message saying you’re unavailable to respond to an incoming text. Here’s a list from DMV.org with great suggestions for apps to fight distracted driving.
Have a passenger navigate for you
If you’re driving with a passenger (of an appropriate age), hand the directions to them. Even a not-so-great navigator in the passenger seat is better than the person behind the wheel being responsible for both driving and navigating. If you’re driving by yourself, take the time to look at the directions before you set off. Then turn the volume up and let the AI lead the way.
Make music selection easy
Make multiple playlists that you can choose from before starting the car. If you really need to change it up, either pull over or wait for a red light. Set your presets to stations you already know you like. Hitting one button is better than cranking the dial until you find music you like.
Don’t text while driving
If you’re behind the wheel, just put the phone away. Social media can wait. It’s not going anywhere — that we can promise. Are the notifications too tempting? Turn them off! No comment or new tweet is worth the risk.
Eat at home or while stopped
If you’re in a rush and want to keep things moving, consider the hazards of driving while eating behind the wheel. Hopefully you can recognize that the risks outweigh the temptation, and you can wait until you get to your destination to eat.
How Does Distracted Driving Affect Insurance?
For starters, getting into an at-fault accident will almost always make your insurance premium go up, simply because your insurance company now deems you a higher-risk driver. Distracted driving is no exception. Even if you avoid an accident but you get a ticket for distracted driving, you’re susceptible to those increases in insurance.
Why does distracted driving increase insurance? For starters, you may be getting a discount for having a clean driving record. But if you get a ticket, such as for texting while driving, you may no longer be eligible for that discount, and you’ll notice an increase in your premium. Another reason your insurance might go up goes back to being a higher risk. If you’re guilty of distracted driving, an insurance company will consider you a high-risk driver (meaning you’re more likely to file a claim due to an accident) and they’ll set your premiums higher.
Many of the discounts that insurance companies give out revolve around rewarding drivers for having no claims and a good driving record in general. Don’t let distracted driving take away those perks!
Protect Yourself From Distracted Drivers on the Road
Avoiding distracting driving behaviors is a great way to be safe on the road, and car insurance is a great way to stay protected from the unexpected. With American Family you can customize your car coverage to meet your unique needs. Talk to your agent today to find the right coverage for you.
The Insurance Information Institute claims driving while interacting with a mobile device can increase the odds of a crash by as much as 3.5 times, compared to the risks that a sober, alert and attentive driver faces. Teens are more susceptible to collisions, even when speaking hands-free on a mobile phone. Let’s explore the many ways you can help prevent distracted driving accidents.
- Buying a New Car Checklist
How exciting is it to walk into a car dealership and drive out in a brand-new car? That excitement can dwindle, though, if you don’t have the right paperwork and information with you. Avoid that roadblock and read our overview of what to bring when buying a car so you’ll be prepared and ready to drive off the lot.
