Car Corner
The Trade Down Choices

February 1, 2010
By Scott Lewis

Last month I introduced you to the trading down plan to get significantly lower car payments. Something many of us may be thinking about... with the economy in its current state.

This column is not typically about the minutia of selling and buying cars. It is about the cars themselves. So, with all that in mind here is my purchase criteria:

• Payments less than $350
• Something I can live with for a very long time

That was a short list. The $350 monthly payment is a maximum, I would really like to get it down to $300. This payment also dictated last month's price of $17,000 for the vehicle itself. Feel free to download the spreadsheet that allows you to calculate everything you need to know to make an informed decision on trading in a car, whether you are trading down or up, are upside down on your current vehicle, or have equity in it.

If you will recall, I wrote an article in May 2009 on buying a used car for less than $15K that was still under its factory warranty. Prior to that I wrote an article on buying used cars for under $15K... forgoing any chance for a warranty. This earlier article had the intention of the car being a second car.

This month I am have to be practical and fall somewhere between those two extremes. Due to how much upside down I am on my current car, and the amount of cash I have on hand for this endevour, I need the price of the car I buy to stay below $17,000. I hope to find something close to $15K, but will go a little higher if the car has something special about it (extra low mileage, still under warranty, navigation system, my favorite color, etc.).

I really want to get a Mini Cooper S in Charcoal Gray with leather seats, Harmon Kardon stereo and automatic climate control. This is what I traded in to get my BMW 335i. However, I traded in a convertible and I would skip the drop top this time. Coupes will be more affordable than convertibles. Also the back seat gets smaller with the convertible, and I have two teenage boys to carry around. One at a time in the back seat would not be too much trouble.

However, there is the possibility that my wife may have to drive the car in a pinch. That means an automatic. I do not want a Mini Cooper with an automatic. I test drove one, and it takes almost all the fun out of driving the car when you remove the third pedal.

Since I have two boys that also leaves out any two seaters or I would just run out and get a Miata. They are the perfect convertible. Light, nimble, not too fast, not too slow... again with a manual transmission. But you can't seat three people.

This brings me to my all around fall back car. The Honda Accord. Since I am not looking for a family car I will definitely be looking at a coupe. Since the Accord is not sporty I could live with a four cylinder and an automatic.

Finally, in all my searching over the last few years there is one car that might fill the shoes of both the Mini Cooper S and the Honda Accord Coupe. And this unique car is the Volkswagen GTI. The GTI was a car I was seriously considering when I purchased my 2006 Mini Cooper S Convertible. I would look for one with the DSG transmission. This is an automated manual transmission (as opposed to a typical fluid based manually shifted automatic). You can put the car in drive and the car's computer will work the clutch completely for you. Or you can put it in manual mode and snap off shifts faster than a human normally could with the paddles behind the steering wheel.

Let's go over each car in a little detail, in order of preference:

2005-2007 Mini Cooper S - This is my first choice. Notice that the 2007 model is the redesigned one with the direct injection, turbocharged engine compared to the previous supercharged engine. I like the engine and exterior of the 2007, but prefer the original 2002-2006 interior. I would like leather seats (over the vinyl... I mean leatherette) and I really like the automatic climate control and Harmon/Kardon stereo that come with the Premium Package. The 2007 models are just falling into this price range, but I would need to test drive one before making up my mind. The interior looses some charm with me. With a good 2005-2006 car with under 50K miles I would have no trouble buying one without driving it (but with a CarFax report).

2005-2007 Accord Coupe - I really like this car. I have seen affordable examples with leather seats and the 4 cylinder engine. This car should prove to be the most reliable of the three here. Hondas are very reliable. I see this car as something I could drive as a backup car when I can afford a classic or a convertible. It would also make a great hand-me-down car to one of my boys. With an automatic my wife could drive it with no trouble. However, this car will be the least fun-to-drive of the three here. And that becomes the big dilemma... fun or practicality. We'll see.

2006-2007 VW GTI - Leather interior in this car is out. The cost of leather when these were new means that it would be out of my price range at this point in time. Also, the GTI has a very nice cloth interior and from some preliminary checking it is everywhere. This car is available with two possible transmissions, an automated manual that works like an automatic and a fully manual transmission with a clutch pedal. I could go either way, but the DSG paddle shifted version would allow my wife to drive the car while minimizing the loss of the fun factor for me. However, I do have a reservation about an automated manual... engagement. Working three pedals and churning a stick is very engaging. Will this be lost with a GTI equipped with the DSG transmission?

Conclusion

I have narrowed my search down to three cars: 2005-2007 Mini Cooper S, 2005-2007 Honda Accord Coupe, or 2006-2007 VW GTI. That is a record for me. And a very practical list. If you are looking at too many different vehicles you will be looking at way too many actual vehicles.

By narrowing my choices to three it should be relatively easy to find a car in the price range I need.

I will be checking AutoTrader, Craigslist, eBay and any other used car sites I can find. If you know of good places to look for used cars... please let me know. Keep in mind I need to buy from a dealer.

I will let you know how this turns out.