The Top 10 Cars Under $20,000

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Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.

Editorial Note: This content is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by the financial institution.

Cheapest new cars
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Recently, I was in the market for a new car. Although I knew buying a used car was much cheaper than buying new, I was sick of dealing with used cars that needed thousands of dollars in repairs.

I was on a strict budget, and many friends and family members told me I was living in a dreamland if I thought I could buy a car for so little.

However, I knew exactly what my money could get me. Because I was willing to sacrifice size and luxury features, I was able to get a car — a new Mitsubishi Mirage hatchback — for less than half what most new cars cost.

If you don’t have a fortune to spend, choosing one of the cheapest new cars available today can be a smart financial decision. You get the reliability and manufacturer warranty of a new vehicle without going broke.

Shopping around for a car loan

It’s wise to shop around and compare offers on auto loans before heading over to the dealership. Consider starting with an online comparison platform such as our parent company, LendingTree. They have dozens of lenders in their network. You simply fill out one short form and can compare up to five auto loan offers in minutes. Some of the lenders on their network may perform a hard pull on your credit, but keep in mind that multiple hard pulls at one time will only count as one pull.

Get Personalized RatesOn LendingTree’s secure website

The 10 cheapest new cars

According to Kelley Blue Book, one of the most trusted resources for car owners, the average sale price of a new car in January 2017 was $34,968. Most buyers don’t have that kind of money in the bank to purchase a car in cash. In fact, 86 percent of new car buyers finance their vehicles, reported Experian.

Because most people rely on car loans, buyers are stuck with monthly payments and long repayment terms. For new car buyers, the average loan payment is $509 spread out over more than 68 months. Such a long loan term can add hundreds or even thousands of dollars in interest charges.

But you can dramatically reduce the debt you take on and lower your monthly payment by selecting a less expensive vehicle. Today, cheap new cars can be reliable and safe; you just might have to skip extra features such as a leather interior or premium sound system.

We looked at the least expensive cars available today and ranked them by price. When you review this list, you might think you’ve seen cheaper prices elsewhere. That’s because most manufacturers list the lowest price available, which is usually a car with a manual transmission.

However, fewer and fewer people can drive a stick and only 3 percent of vehicles sold have a manual transmission, reported the LA Times. Because of that issue, our list includes only the prices of cars with automatic transmission.

Here’s our list of the 10 cheapest new cars you can buy right now, all of which are under $20,000.

10. Mazda 3 4-Door Sport: $19,145

When you’re shopping for a car under $20,000, you often have to sacrifice horsepower and interior comforts. However, the Mazda 3 4-Door Sport has one of the most powerful engines on this list with 155 horsepower. It’s still fuel efficient, though, averaging 28 mpg in the city and 37 mpg on the highway.

However, the interior of the Mazda 3 is its strongest selling point. It has features you’d associate with much more expensive cars, such as an air conditioner with pollen filter, push-button start, voice command capabilities, and Bluetooth.

If you’re used to driving larger sedans or SUVs, switching to a compact can be a big transition. You often have to learn how to deal with road noise and more movement on the highway. But the Mazda 3 is larger than many of the cars on this list, and at 2,899 pounds, it has a secure and steady ride.

9. Chevrolet Sonic LS: $17,370

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If you want a car that’s compatible with the latest technology, the Chevrolet Sonic LS might be the vehicle for you. The car has the Chevrolet MyLink — a built-in touchscreen system — with Bluetooth capability. It can connect to both Apple CarPlay and Android Auto.

You can skip the adapters; the Sonic has USB ports for your smartphone. And if you’re worried about security, Chevrolet offers a three-month OnStar trial. It even has a rearview camera, which is a standard feature that even more expensive cars often don’t have.

8. Toyota Yaris LE: $17,285

Toyota is well-known for its exceptional quality, and the Yaris upholds its reputation. With style and extra features, the Yaris LE combines performance with efficiency.

Unlike many cars on the list, the Yaris is a three-door vehicle, rather than a four-door. That can take some getting used to, but it has other features that help make up for it, including a rearview camera and touchscreen radio and navigation system.

Some reviewers say that the seating in the Yaris is uncomfortable compared to other subcompacts, so that’s another factor to keep in mind if you have a long commute.

7. Kia Rio S: $16,100

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The Kia Rio S is a good option for someone who prioritizes performance but is on a budget. It has a tight turn radius, so it’s an excellent choice for those who live or work in the city and need to navigate through traffic.

It also has features that you’d expect in a far more expensive car, such as a touchscreen audio system and rearview camera. However, the Rio falls behind a few other inexpensive vehicles in fuel economy, averaging just 28 mpg in the city and 37 mpg on the highway.

6. Smart Fortwo Pure Coupe: $15,990

The Smart Fortwo Pure Coupe is definitely not for everyone, but if you like quirky and cute, it might be for you. It’s far and away the smallest vehicle on the list and, with just 89 horsepower, it has a fairly weak engine. If you do a lot of highway driving and need to accelerate or switch lanes quickly, you might find the Fortwo inadequate.

In addition, it’s size also means that a backseat and cargo space is nonexistent. If you need to transport a lot of groceries or your latest Target haul, this car isn’t a wise option.

However, it’s remarkably fuel efficient, getting 33 mpg in the city and 39 mpg on the highway. If you’re looking for a small compact car that goes far on a tank of gas and fits in congested areas, the Fortwo could work.

5. Fiat 500 Pop: $15,985

The Fiat 500 Pop is cute and sporty. In fact, Kelley Blue Book ranked it as one of the top 10 coolest cars under $25,000 last year.

The Italian automaker designed the 500 to stand out from other subcompacts. It sits lower over the wheels and has a spoiler to improve aerodynamics and add to its sleek appearance. All 500 models have a 5-inch, full-color touchscreen, a media hub, hands-free calling, and more.

Its fuel efficiency is on par with the much smaller Smart Fortwo, but has a more powerful engine and a more fun driving experience.

4. Mitsubishi Mirage G4 ES: $15,595

The Mitsubishi Mirage G4 ES offers a lot of bang for your buck. It’s one of the four least expensive cars out there but offers standard features like rearview camera, Bluetooth capability, touchscreen display, and USB ports. It can also comfortably seat five people and has enough trunk space to tote your groceries around.

Mitsubishi also offers one of the best warranties in the industry; with your purchase, your new car is backed by a five-year, 60,000-mile limited warranty and a 10-year, 100,000-mile powertrain warranty.

However, the Mirage G4 has an anemic engine with just 78 horsepower — the lowest on our list. But on the plus side, that small engine gives you amazing fuel efficiency. It has the best gas economy of all ten vehicles, averaging 33 mpg in the city and 40 mpg on the highway.

3. Hyundai Accent SE Sedan: $14,745

Although the Hyundai Accent SE Sedan is in the top three when it comes to the cheapest new cars, it lacks the benefits of other vehicles on this list.

Averaging just 26 mpg in the city and 36 mpg on the highway, it has one of the worst fuel economy ratings. In addition, it doesn’t have features like Bluetooth or a rearview camera, which come standard in other cars.

However, the Accent does have Hyundai’s excellent 10-year, 100,000-mile powertrain warranty behind it. And it has more cargo space, so it’s a better option for families than some other vehicles.

2. Nissan Versa Sedan S Plus: $14,130

The Nissan Versa Sedan S Plus offers decent fuel economy and more seating and cargo space than most of the other cars listed here. If you need more space but are on a budget, the Versa can fit a family comfortably, even if you include a car seat.

However, the Versa offers the least amount of entertainment and convenience features. The S Plus doesn’t have a rearview camera, keyless entry, or a USB port. It’s a barebones trim that works for families that need a commuting car but don’t want to spend a lot.

1. Ford Fiesta S: $13,660

Of all of the cheap new cars available today, the Ford Fiesta S beats them all when it comes to price. It also offers comfortable seating for up to five people and 12.8 cubic feet of storage space.

The Fiesta has a respectable 120-horsepower engine, so it has a fun ride that handles highway driving without any problems. It also has features like the SYNC 3 system, which allows you to use Apple CarPlay and Android Auto. You can interact with your phone too, sending and receiving text messages without taking your hands off the wheel.

If you need an inexpensive vehicle that delivers on space and convenience, the Fiesta tops the list of cheapest new cars.

Buying a new car

Buying a new car doesn’t mean you have to be in debt for six years or more. By looking at compact and subcompact vehicles, you can buy a brand new car without taking on a lengthy auto loan. All 10 of the cheapest new cars on this list offer a lot of value for their price, making them a smart choice when you’re on a budget.

If you’re ready to buy, you can time your purchase to take advantage of dealership and manufacturer incentives and save thousands.

Interested in a personal loan?

Here are the top personal loan lenders of 2018!
LenderAPR RangeLoan Amount 
1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

  1. Personal Loans: Fixed rates from 6.990% APR to 14.865% APR (with AutoPay). Variable rates from 6.255% APR to 12.555% APR (with AutoPay). SoFi rate ranges are current as of September 1, 2018 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. See APR examples and terms. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 6.255% APR assumes current index rate derived from the 1-month LIBOR of 2.08% plus 4.425% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.

    To check the rates and terms you qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull.See Consumer Licenses.
  2. Minimum Credit Score: Not all applicants who meet SoFi’s minimum credit score requirements are approved for a personal loan. In addition to meeting SoFi’s minimum eligibility criteria, applicants must also meet other credit and underwriting requirements to qualify.
  3. SoFi Personal Loans are not available to residents of MS. Maximum interest rate on loans for residents of AK and WY is 9.99% APR, for residents of IL with loans over $40,000 is 8.99% APR, for residents of TX is 9.99% APR on terms greater than 5 years, for residents of CO, CT, HI, VA, SC is 11.99% APR, and for residents of ME is 12.24% APR. Personal loans not available to residents of MI who already have a student loan with SoFi. Personal Loans minimum loan amount is $5,000. Residents of AZ, MA, and NH have a minimum loan amount of $10,001. Residents of KY have a minimum loan amount of $15,001. Residents of PA have a minimum loan amount of $25,001. Variable rates not available to residents of AK, TX, VA, WY, or for residents of IL for loans greater than $40,000.
  4. Terms and Conditions Apply: SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)

2 Includes AutoPay discount. Important Disclosures for Payoff.

Payoff Disclosures

  1. All loans are subject to credit review and approval. Your actual rate depends upon credit score, loan amount, loan term, credit usage and history. Currently loans are not offered in: MA, MS, NE, NV, OH, and WV.

3 Important Disclosures for FreedomPlus.

FreedomPlus Disclosures

  1. All loans available through FreedomPlus.com are made by Cross River Bank, a New Jersey State Chartered Commercial Bank, Member FDIC, Equal Housing Lender. All loan and rate terms are subject to eligibility restrictions, application review, credit score, loan amount, loan term, lender approval, and credit usage and history. Eligibility for a loan is not guaranteed. Loans are not available to residents of all states – please call a FreedomPlus representative for further details. The following limitations, in addition to others, shall apply: FreedomPlus does not arrange loans in: (i) Arizona under $10,500; (ii) Massachusetts under $6,500, (iii) Ohio under $5,500, and (iv) Georgia under $3,500. Repayment periods range from 24 to 60 months. The range of APRs on loans made available through FreedomPlus is 4.99% to a maximum of 29.99%. APR. The APR calculation includes all applicable fees, including the loan origination fee. For Example, a four year $20,000 loan with an interest rate of 15.49% and corresponding APR of 18.34% would have an estimated monthly payment of $561.60 and a total cost payable of $7,948.13. To qualify for a 4.99% APR loan, a borrower will need excellent credit on a loan of $15,000 with a term of 24 months, and qualify for at least two of the following discounts: (1) add a co-borrower who has sufficient income; (2) use at least fifty percent of the loan proceeds to directly pay off existing debt; or (3) show proof of having at least forty-thousand dollars in retirement savings – contact FreedomPlus for further details.

4 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  1. Personal Loan Rate DisclosureFixed interest rates from 6.49% – 19.49% (6.49% – 19.49% APR) based on applicable terms. Lowest rates range from 5.99%-18.99% (5.99%-18.99% APR), are for eligible applicants, require a 3-year repayment term, and include our Loyalty and Automatic Payment Discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
  2. Loyalty Discount: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with us at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  3. Automatic Payment Discount: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their Citizens Bank Personal Loan during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account two or more times within any 12-month period, the borrower will no longer be eligible for this discount.

5 Important Disclosures for LendingPoint.

LendingPoint Disclosures

  • Loan approval is not guaranteed. Actual loan offers and loan amounts, terms and annual percentage rates (“APR”) may vary based upon LendingPoint’s proprietary scoring and underwriting system’s review of your credit, financial condition, other factors, and supporting documents or information you provide. Origination or other fees from 0% to 6% may apply depending upon your state of residence. Upon LendingPoint’s final underwriting approval to fund a loan, said funds are often sent via ACH the next non-holiday business day. LendingPoint makes loan offers from $2,000 to $25,000, at rates ranging from a low of 15.49% APR to a high of 34.49% APR, with terms from 24 to 48 months. The loan offer(s) shown reflect a 28 day payment cycle which is being offered as a courtesy as many of our customers are paid on a biweekly schedule and thus this may better align the loan payment dates with your actual income receipt schedule.

6 Important Disclosures for LendingClub.

LendingClub Disclosures

All loans made by WebBank, Member FDIC. Your actual rate depends upon credit score, loan amount, loan term, and credit usage & history. The APR ranges from 6.95% to 35.89%*. The origination fee ranges from 1% to 6% of the original principal balance and is deducted from your loan proceeds. For example, you could receive a loan of $6,000 with an interest rate of 7.99% and a 5.00% origination fee of $300 for an APR of 11.51%. In this example, you will receive $5,700 and will make 36 monthly payments of $187.99. The total amount repayable will be $6,767.64. Your APR will be determined based on your credit at the time of application. The average origination fee is 5.49% as of Q1 2017. In Georgia, the minimum loan amount is $3,025. In Massachusetts, the minimum loan amount is $6,025 if your APR is greater than 12%. There is no down payment and there is never a prepayment penalty. Closing of your loan is contingent upon your agreement of all the required agreements and disclosures on the www.lendingclub.com website. All loans via LendingClub have a minimum repayment term of 36 months. Borrower must be a U.S. citizen, permanent resident or be in the United States on a valid long term visa and at least 18 years old. Valid bank account and Social Security number are required. Equal Housing Lender. All loans are subject to credit approval. LendingClub’s physical address is: LendingClub, 71 Stevenson Street, Suite 1000, San Francisco, CA 94105.

†Per reviews collected and authenticated by Bazaarvoice in compliance with the Bazaarvoice Authentication Requirements, supported by anti-fraud technology and human analysis. All reviews can be reviewed at reviews.lendingclub.com

**Based on approximately 60% of borrowers who received offers through LendingClub’s marketing partners between January 1, 2018 to July 20,2018. The time it will take to fund your loan may vary.


7 Important Disclosures for Earnest.

Earnest Disclosures

  1. Earnest does not lend in Alabama, Delaware, Kentucky, Nevada, or Rhode Island.

8 Important Disclosures for Avant.

Avant Disclosures

* The actual rate and loan amount that a customer qualifies for may vary based on credit determination and other factors. Funds are generally deposited via ACH for delivery next business day if approved by 4:30pm CT Monday-Friday. Avant branded credit products are issued by WebBank, member FDIC.

** Example: A $5,700 loan with an administration fee of 4.75% and an amount financed of $5,429.25, repayable in 36 monthly installments, would have an APR of 29.95% and monthly payments of $230.33


* Important Disclosures for Upgrade Bank.

Upgrade Bank Disclosures

* Your loan terms are not guaranteed and are subject to our verification and review process. You may be asked to provide additional documents to enable us to verify your income and your identity. This rate includes an Autopay APR reduction of 0.5%. By enrolling in Autopay your payments will be automatically deducted from you bank account. Selecting Autopay is optional. Annual Percentage Rate is inclusive of a loan origination fee, which is deducted from the loan proceeds. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. All loans made by WebBank, member FDIC. Please refer to Upgrade’s Terms of Use and Borrower Agreement for all terms, conditions and requirements.

** Accept your loan offer and your funds will be sent to your bank via ACH within one (1) business day of clearing necessary verifications. Availability of the funds is dependent on how quickly your bank processes this transaction. From the time of approval, funds should be available within four (4) business days.

7.73% – 29.99%$1,000 - $50,000

Visit Upstart

6.26% – 14.87%1$5,000 - $100,000

Visit SoFi

6.99% – 35.97%*$1,000 - $50,000

Visit Upgrade

5.99% – 24.99%2$5,000 - $35,000

Visit Payoff

4.99% – 29.99%3$10,000 - $35,000

Visit FreedomPlus

5.99% – 18.99%4$5,000 - $50,000

Visit Citizens

15.49% – 34.49%5$2,000 - $25,000

Visit LendingPoint

6.95% – 35.89%6$1,000 - $40,000

Visit LendingClub

6.99% – 18.24%7$5,000 - $75,000

Visit Earnest

9.95% – 35.99%8$2,000 - $35,000

Visit Avant

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.

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