Four years ago I bought a 1987 190D 2.5 with about 165,000 miles for $500. So essentially six years younger than the car you are considering with 100k fewer miles. It had a poor idle, and a slipping transmission. No dents, paint good, rust around the jack points, but limited to only those areas. Everything else was fine. I overpaid about $2500 for it based on what I've put into it since.

It's gonna be a money pit. It's a nice car (although the 2.2 liter is slow). If it needs little immediate work and it's in really nice shape, it's worth a couple of hundred bucks but ONLY if you really like and want the car. Because it's gonna bleed you. Good luck!

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1987 W201 190D