I want to clarify that this car is in really good shape. I'm a nuke and tend to nuke things out, meaning I over-think, am overly critical and track and trend the condition of things more so than many people I know who aren't nukes....well, that doesn't include your average BITOG'er!
Some more positives not listed above:
1. Great suspension: The car handles and steers really well. It provides great feed back, direct steering and a pretty confident ride for a compact econobox.
2. Great engine: Looking past the great fuel economy, the engine (and vtech) run really well.
3. Good transmission: Shifting is smooth. There's a slight delays when rolling through things like yield signs, where the transmission takes one full second to figure out whether it wants 1st or 2nd gear, but all shifts from stop to highway speeds are smooth. At highway speeds, the shift from 5th to 3rd shift and then back is seamless (cruise control while on the highway always results in a double-downshift, when a preemptive bit of throttle leading to a single downshift would usually suffice.)
4. PM: Coolant, PSF, Oil, brake fluid, ATF, spark plugs are all well within periodicity. The battery, as previously mentioned, would be the only iffy one; however, I have maintained it better than most would (barring the one light-left-on-all-night, dead-battery time).
Some pics:

The bad (and clarification):
1. Tensioner: It rattles mostly at really cold temps, but it's not really that and isn't even noticeable at all on hot days (I did not hear it with my head in the engine compartment while leaving work this afternoon.) The rattle also isn't even 100% diagnosable as the tensioner (using the stethoscope, I'm 70% sure that it's the culprit.)
2. Rough-starts/vibration: The engine start normally 90% of the time. When extremely cold it may have a rougher time starting. The car does not vibrate at all when the engine is cold. It only does so after fully warmed up (i.e., after a highway trip) on hot days, while stopped in drive.
3. Paint: really can't notice, unless you look for it (admittedly pretty obvious, when you do
Other issues (previously not mentioned):
1. Interior lights: the "AC" and "MAX AC" lights, as well as other lights for the radio and HVAC will occasionally go dark, then randomly come back. Most prevalent when cold. Banging on the dash doesn't do anything and the wedge bulbs aren't burned out, since they do come back.
2. Brake pulsing: I had an issue recently with pulsing brakes. Now that I drive longer distance once a month it seems that the pulsing is 100% gone. I'll try to pull the brakes apart and at least lube the slides and exercise the pistons before giving it to them.
3. TAKATA! Got the notice, so I will not give them the car until this is replaced.
Here in SoTex you car is easily going by at 5000
It's low to mid-$4k here, though I'm not sure what I'd actually get.
That [censored] car will be the sword of Damocles over your head every single waking moment that they own it.
That's genuinely really funny!
Have had a couple of vehicles bought and sold in the family. Found the best practice is to be brutally honest about everything, and sell it for about 10% off of what the blue book price is. That way you're giving them a family discount, not shooting yourself in the foot financially, and they know everything upfront about the vehicle. It's their choice to buy it or not from family. Also, always explain that the vehicle is as is you're not responsible for what goes wrong after the sale, etc.
Good long thread.
I may have glanced over (missed) a sentence or two but I read it all.
Are these rellies appreciative throughout or will they act like wounded puppies when something goes wrong?
Besides the suggested "brutal honesty" describing the car you have to be "brutally honest" describing these people even though they're related to you. Whether you love 'em or not is immaterial.
Years ago I bought a rattle trap ('72 Corolla De Luxe?) from a friend. There was so much to do repair wise. I never dreamt of the seller being involved one bit.
Be frank with yourself (and us if you care to share). Are these people self-dillusional? Are they comfortable being "victims" and fall into the role easily? Are they stupid? (yes, I asked that)
Why, for example, can't they give your assessment of the car's mechanics to their mechanic and they deal with it?
You're doing them a favor with a vehicle of high value.
Are they poor and truly need a "complete car".
However they're getting along with 1 car might be the better way for them to live (you never thought of that, did you?)
Good luck with this "first world problem". Since you're sweating it so profoundly now I'm going to guess not dealing with hem is the better route.
They will know of everything before buying. I'm not a stereotypical A-type personality, but I'm definitely not B-type. Especially in her family, I'm the blunt one, and they know 100% that I wouldn't take any [censored] and would shut them down on anything other than a familial request for assistance with any issues they might have, which I would provide, regardless of who they bought the vehicle from. They may not be appreciative, but they also would know better than to complain about something divulged prior to purchase, given what I consider an exceptional price.
RE: "you never thought of that, did you?" I'm going to take this as tongue-in-cheek, since it would be a real douchey comment to make, otherwise. I'll respond, though, what the heck: they have a teen and a baby. The SIL works (though only recently, due to the baby and just having gotten her degree) and so does her husband. They have needed a 2nd car for a long time. It's not presumptuous. They are not poor, but, to be negative: the SIL likely wants a brand new car that does NOT make sense, which is why they've so far been smart enough not to act impulsively on the desire for TWO new cars. If they buy this car from us, she will drive the CUV and he will drive this - he needs to commute only a few days per week (teleworks the other days) and around-town driving.
The OP isn't looking for advice on whether to sell to SIL, he's already made that decision. But, the fact that he's worried about how much work he should put into a $2500 car so it will be good enough for them kinda says he isn't as comfortable as he thinks.
Bottom line OP is you know your relatives and you know your comfort level. A battery is $100. What is the tensioner repair at the indie, $400-500? These are the big tickets, so you do them and net $2000 for the car and it's as good to go as you can make it or they buy it for $2500 possibly needing $500 in service in the future.
As mentioned above, any car is going to need registered and insurance and maintenance, can they afford it?
Exactly; however, I don't have any issue with people giving their opinion. I'm not asking people to tell me what I should do. I'm asking people for advice, so I can make an informed decision.
The reality is, they're great people. Her family is about as giving and connected as I've ever seen. There's the typical family drama, but their respect for and connection to each other is 100% iron-clad. Again, I have zero concerns about this sale.
The OP isn't looking for advice on whether to sell to SIL, he's already made that decision. But, the fact that he's worried about how much work he should put into a $2500 car so it will be good enough for them kinda says he isn't as comfortable as he thinks.
I'm trying to throw him a lifeline so that he could find a way out of that trap!
Haha, I appreciate that, but the sale to them was my idea!

I know it may sound odd, but I feel that the stress and issues would be MUCH less selling to family. I will fill out a bill of sale, which says "AS-IS", wait for their check to cash, then sign over the title. No loans, no stranger-danger, nothing. Bingo, bango, I have zero head-aches and they get a great car.
Finally, we got the car from a family friend after my now-wife, then-gf's car was crushed by a tree during Irene. We surprisingly got more from insurance than we expected and got the '08 Civic for thousands less, because the family friend had moved out-of-country a year prior and did not need the car.
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Thanks again for all of the input and advice!