One of the most common questions posed on various email lists is about buying an '02 for the first time. The '02 Page does a good job of describing the history of the 2002 and what to look for, so I won't repeat that information. I do find myself writing lots of emails on this subject, so I thought I'd capture some of the ideas here.
Without a doubt the number one thing to look for when buying an '02 is rust. Whatever you do, buy the most rust free car you can afford that fits your needs. That is, if you are doing a restoration from the ground up consider a rust free shell to combine with another parts car. If you need a car to drive tomorrow be willing to buy a car with a ratty interior that has no serious rust over the car with the nice Recaros that has rust all through the rockers.
'02s rust everywhere. They are all old, and they were not expensive cars to begin with. That means almost every '02 has spent time battling the elements. That does serious damage to a car with poor initial rust protection and lots of cavities to catch water and dirt. Because of this you should almost never believe the claims of "rust free" cars that you will see in advertisements.
Once you accept that '02s rust the next most important thing to realize is that rust is more difficult and more expensive to put right than any other problem. Last time I looked a factory rebuilt engine went for something on the order of $1,500. That's child's play for body work. It's very easy to spend four times that or more putting a rusty car straight, and a knowledgeable '02 person will spot the repairs in five minutes. Mechanical work is easy and can be accomplished to showroom condition or better. Body work always falls short.
So whatever you do, take pains to find a car with minimal rust.
It's important to spend some time thinking about which type of '02 you would like to buy. I really feel that when buying your first car this should just be a directional decision rather than a hard and fast rule. I think too many people buy a mediocre example of a specific model (e.g. a round tail light car or a tii) when they would be better off finding a good example of any '02. Because of this I would suggest you develop a set of preferences but look at anything you can find. If you find two cars of equal quality let your preferences break the tie, but don't let yourself get tied to one model over another.
When considering models there are basically a few choices to make.
The number one debate: the '73 and earlier round tail light cars or the '74 to '76 square tail light ones. I own both, so I don't really have a preference. Both have their benefits and draw backs. I think round tail light cars look cleaner, but the square tail light cars feel more solid (less like an old car) and withstand city parking better.
The '75 cars in all 50 states and the '76 California cars have thermal reactors on the exhaust manifolds that hurt power and reduce engine life. All '76 models have reduced compression ratios and more intrusive emissions systems that hurt performance. Very early cars (through around mid '69) will be six volt which is a pain, and the early driveline parts are tougher to find (six bolt clutches, long neck differentials, etc...). All square tail light US cars have heavy bumpers that extend well out from the body.
Other than that it's taste. I own a '72 and '74 tii. I've also owned a '76 2002 and my father had a '69 1600. All were rust free; all were great cars.
This is an interesting differentiator. From the perspective of collectibility the tii is the way to go. They are rare and represent the classic early sports sedan (though and Alfa Berlina owner might dispute that). On the other hand, a carbureted 2002 is a very simple machine. Less power, but only mixture and idle to adjust.
In general I think a straight 2002 is a better bet for a first '02. However, I would like to make two points about the tii. First, they are not nearly as difficult to live with as their reputation suggests. What one needs is a mechanic who knows the injection system or the ability to work on the system on your own. The 2002tii registry run by Bob Murphy can give you the self help materials.
It's very important to recognize some of the misinformation surrounding the tii for what it is. Too many people take the easy way out of blaming the Kugelfischer injection pump when the only problem with a car is a poorly tuned engine. Almost always when the pump is suspected the answer is to properly set mixture, warm up regulator, idle, timing, valves, points, linkage and fuel filters (all four).
The best tii story I have comes from when I was working as an apprentice to a very good tii mechanic when I lived in New Orleans. A customer brought in a beautiful '74 tii that would barely idle. Another shop had spent ten hours diagnosing the car and claimed the pump was bad. The price quoted to rebuild the pump was $600 (in 1985), and the owner wanted a second opinion as he had just bought the car for $6,000. A quick look under the hood (by the owner of the shop, not me) revealed the number two and three plug wires were crossed. That will make any car run poorly, but on a tii too many mechanics just ascribe any problems to the pump. Don't believe them.
The second point on tii's is less positive--they are usually over priced. I've seen a lot off tii's, especially 1972 tii's, that are ludicrously over priced. For this reason you should be very careful if you are buying a tii for your first '02.
Continuing to make my biases clear: I currently own two tii's and have in the past owned carbureted 2002s. I would not hesitate to own either again.
Basically when people hold out for options on a 2002 they are looking for either a/c or a sun roof. The benefits of both are obvious, but make sure you are aware of the detriments as well.
2002 air conditioning is a bit of an oxymoron. None of the dealer installed systems worked very well, though the Behr versions out performed the Frigiking ones. Recent upgrades to rotary compressors made by Clardy work better if done well. However, none of these systems will approach new car standards. Also, the a/c kills power when running, and it makes the car run much warmer. A car with a/c is more likely to have been over heated because of this.
Sun roofs help ventilation considerably, but they also represent one of the greatest design flaws in the '02 range. As installed the drain tubes from the sliding roof end in the rocker panels. These parts are already prone to rust, and filling them with water just makes the situation worse. The drains can be repositioned to go out via the rear wheel well, but invariably a sunroof car has more rocker panel rust than a non sunroof car.
Neither of my current cars have a/c, but my first 2002 did. I've never owned a 2002 with a sun roof.
Do you want to get a car with the nice wide fender flares, rear spoiler and blacked out chrome or do you want the boring old 2002 with the original radio and wheels? This is purely up to taste, but the original cars are becoming more and more rare. In my opinion you are more likely to avoid losing money on a stock car than a modified one. Of course if you aren't planning on selling the car that isn't an issue.
One thing to think about before modifying a previously stock car is that you are unlikely to approach the performance of any modern car for anything like a reasonable amount of money. In my opinion if you want a car that is just fast get a new one; if you want to own a piece of automotive history get a stock 2002. On this subject my bias is clear--all of my '02s have been as close to stock as I can get them, and I never pass up a chance to make them more so.
In general this is not a big decision, because almost any car you are likely to come across will be a 2002 or a 2002tii. However, as you can see by the history chart on these pages, there are lots of other variants of the '02 range. Should you buy one?
In general these cars will not be as collectible as a 2002. I have owned both a 2000cs and an 1800 four door, and my father owned a 1602. These were all great cars, but they don't have the cult status of the 2002. In general the non '02 sedan body styles (the touring, the coupe and the four door) will be harder to find parts for, and the coupe and four door rust more. Thus, from a practical perspective you should avoid these cars.
However, from a practical perspective you should avoid a 2002 and buy a Saturn. The non 2002 '02s are great cars as well, and if a 2002 is too mainstream for you they are a good option. All have their own sub-culture of enthusiasts that support them. Just realize you are less likely to get your money out of one of these cars than a straight 2002.
All I can say on this topic is to see a lot of cars. Lots of people ask for price advice, but invariably the best thing to do is see a lot of cars and calibrate prices in your own area for yourself. The basic premise is to never buy the only car you've ever seen. Even if you go to see a beautiful car for a reasonable price on the first try, spend the next day seeing every 2002 you can find. Even if you need to put down $100 to hold the first one, getting some calibration is well worth it. There are so many variables that you could easily be paying for something you don't value--if you don't care about round vs. square tail lights save the money and buy a '74 with less rust.
What books should you buy? In my mind their are four that stand out above all others.
The factory parts manual is now being reprinted by BMW Mobile Tradition and is available from the dealer or after market suppliers that stock BMW parts.
The factory shop manual is the definitive source for repair help, but has yet to be reproduced by Mobile Tradition. TMC Publications in Baltimore (they advertise in the Roundel) will sell you a copy, and original blue binder versions show up in the Roundel classifieds every few months.
BMW Mobile Tradition has just published "The BMW 02 Series: The Cult Car." This is a great history of the entire range.