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The BMW E46 M3 is without a doubt one of the most iconic BMWs ever made. Its timeless good looks and unusually high-strung six cylinder engine made it a force to be reckoned with. But is it possible to buy one of the roughest examples ever, restore it on a budget, and make a profit on resale?

Part 1: The Last "Real" M3

The E46 M3 was the last in a long line of analog six-cylinder masterpieces -the last true M3 to come out of Regensburg, Germany before the model got needlessly bulky and added the unnecessary heft of a V8 under the hood. And if you've heard that line before, it saves me the time of not having to welcome you to the internet - the only place where a person's anus comes a distant second in the body's ability to spew crap, first place going to the walnut shell that used to house a functional brain, now irreparably corrupted by years of forum debate, cat videos, and tentacle hentai.

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In North America, the E36 M3 from the 90s was little more than a uprated 328i. It had a relatively tiny amount of horsepower, and shared none of the high-revving cutting edge race-car technology that its freaking fantastic European cousin got. I should know - I had one - and while it was a well-balanced car, it could get its doors blown rightly off by any Camry owner in a frantic rush to purchase the newest issue of Beige! Magazine.

Not so with the E46. It had a no-fooling 3.2 liter inline-six cylinder engine pushing 333 horsepower, which seemed like too much. It did this by using race-car trickery like independent throttle bodies and variable valve timing on the intake and exhaust cams. The chassis was unique to the M3 and didn't have nearly anything in common mechanically with the other pleb-level 3-series models. This version marked the last of the naturally aspirated six-cylinder autobahn destroyers, and although it would get overshadowed in nearly every conceivable way by the V8-powered E92, the E46 holds a special place in the hearts of countless internet trolls that would rather die than to be swayed with reason. Here's everything you need to know about this amazing car.

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Part 2: The Street Of Hard Knocks

There's a certain element of danger associated with doing what I do. Sometimes you buy a pile of crap and risk losing money on resale. Sometimes you end up in sketchy neighborhoods far away from home. This one was a little of both.

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As I browsed the local Craigslist classifieds for potentially restorable candidates, one car caught my eye. It was a 2002 M3 that had really amazing looking pictures that didn't really match its low asking price.

From the looks of things, the only cosmetic issue listed was a slight ding on the door and a blemish on the front splitter. It was a six-speed manual with some carbon fiber goodies, an upgraded KW adjustable coilover suspension, and apparently a flip-out touchscreen navigation system, for $9,500 or best offer. I called immediately and set up a time to check out the car.

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If there was a car version of the show Catfish, this car would be the star of the season finale. Here's what the car actually looked like when I got to the cramped New York City street:

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This car was trashed with a capital F. There wasn't a panel on the car that didn't require some sort of attention. The suspension looked as if it was collapsed in the rear, the front wheels were different widths (one was a OEM front, the other was an OEM rear), the front and rear bumpers were cracked and dented beyond belief, the car had AC Schnitzer badges, despite not having any actual AC parts, the taillights were cracked, and the door's "slight ding" resembled the aftermath of a drunken knife fight between the two slightly frumpy guys in accounting - hilariously sloppy and hard to look at. This was way before I even called the guy to come downstairs and hand me the keys to this Bavarian turd. But like any Englishman worth his salt, I kept calm and carried on.

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The car turned on without much drama, but so did nearly all of the dashboard's warning lights, other than the Check Engine Light, which was either a good sign or an indicator that the Check Engine Light was broken. The valve cover gasket was leaking quite badly and the plastic expansion tank in the cooling system had ruptured, sending expensive BMW coolant everywhere but in the engine.

I took the car for a test drive around the block and it had the poise of a dehydrated ox. The ride was uncompromising and the car was all over the road. Since the coolant needed to be topped up on every ride and leaked out in short order, the running of the car likely sent a few neighborhood cats to meet their maker prematurely. This also made the car smell quite badly, not being helped by the obvious oil leak and various maladies that plagued the interior and exterior of the car. Most people would run away. Most smart people. But I'm not most people. And I'm definitely not smart.

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Here's what I did know that made the car eligible for a flip: the vehicle history was clean with no accidents or dodgy title-washing, I found out from a friend that worked at BMW that this particular car had the notorious rod bearing recall done early in its life and actually was serviced at the dealer for quite some time, the car had none of the common subframe cracking issues that these models tended to get, and the engine didn't emit any sort of VANOS rattle or timing chain guide noise. It was a solid foundation with one hell of a rough surrounding structure. Against my better judgment, I offered $7,000 for the car, not budging from that number and ready to walk away. The seller accepted, and I bought myself the roughest BMW M3 in the world with a healthy side of instant regret.

Part 3: Budget? It's More Of A Guideline, Really.

After I arranged a tow and chatted with the European tow truck driver for an hour (who was a huge BMW fan) about how the United States got royally shafted with the E36 M3, this is what I was left with, which you would know if you followed me on twitter:

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And lots of goodies, also known as required fluids, were stored in the back:

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If I was to make this into the canyon-carver it deserved to be, I had to make a game plan and attack the car's faults from large to small. The first hurdle was the awful bodywork. After several hours of searching, I found a matching color door in great condition, along with a mismatched rear bumper and front bumper. I picked them up and started work as soon as humanly possible.

I took off the offending door and swapped over all the electronics/locks/window malarky and lined up the panels as best I could using the factory shims, as well as adjusted the ride height in the rear to eliminate the dumped look:

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I then took off the front and rear bumpers to prep the car for the new bumpers:

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I had the good condition OEM replacements professionally painted in the factory 416 Carbonschwartz Metallic, and they looked spectacular, topping them off with new front fogs and new rear LED tails, as well as a carbon fiber CSL-style rear diffuser:

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Now that the exterior was given a fresh look, it was time to tear into the mechanicals of this aging Bavarian bruiser. I chose to do a fresh service using Liqui Moly 10W60 German synthetic oil with an OEM filter. I used Bosch Platinum spark plugs, and ordered a new valve cover gasket. I also replaced the hilariously broken clutch fan blades and got a new expansion tank, coolant level sensor, oil level sending unit, fuel filter, and in-cabin air filter, as well as did a full coolant flush.

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The car ran absolutely beautifully after this. I was well on my way to having an near-immaculate BMW M3. The last thing to tackle was the horrid state of the interior.

To clean up the distressed and pitted look of the dashboard trim, I wrapped all pieces in 3M Brushed Titanium Vinyl (and replaced nearly all the clips I broke), including the steering wheel, carefully cutting around the "///M" emblem. I also got some black leather from a local fabric shop and recovered the door panel's leather inserts using a hot glue gun and some elbow grease.

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To tackle the fading and hard leather seats, I elected to use a leather restoring product called Refinish Coatings. They were nice enough to send me a restoration kit and emailed me detailed video instructions. It was without a doubt one of the best products I've ever used on leather - especially something as hard as BMW's base model 3-series leather, which is prone to crack and fade. The process was a bit lengthy, but just as in a paintjob, a good job requires 90 percent prep and 10 percent paint. I wetsanded the seats, cleaned them thoroughly, and applied thin layers of the solution using a brush and sponge and waited until they were dry.

Afterwards, I used an arsenal of reliable and effective weaponry to clean the interior. Here's the full list of what I used:

I topped off the interior detail with a brand new OEM illuminated shift knob and painted the speaker grilles to match the dash. Here were the results:

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To finish off the exterior, I bought a 4th "rear" size wheel to finish off the "square stance" that's so popular in the M3 community. It's when you ditch the factory staggered 8.5" and 9.5" front/rear wheels for an all 9.5" wheel setup. It allows the car to rotate better on turns and looks ten times better than the weaksauce stock wheel setup. Since I got the car with one wide wheel in the front anyway, I figure I'd finish off the look. After installation, I washed, clay barred, polished and waxed the car using these products:

I also followed these tutorials, made by Larry Kosilla at AMMO NYC and /DRIVE:

Here were the results:

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Part 4: The Moment Of Truth

I took the car on a shakedown run...or ten. Without going into a full-on review of the car, I will say that it deserves every bit of its "Ultimate Driving Machine" namesake. The gears are long and the power delivery is gradual and controllable, with the peak horsepower right at the tippy-top of its 7k+ rpm rev range. In "Sport" mode, it's nearly impossible to drive in 1st gear around town, as the throttle snaps open and shut, making for a pretty jerky experience. I hadn't tracked the car, but on the few corners that I did experience in anger, the car responded absolutely predictably. This car was the yardstick of performance in the early 2000s, and it still holds the title for best performance value, especially at this price. It was truly a gem, and I'm glad to have brought it back to fight a few more rounds. I sold it on eBay ( original listing here) and it went to a local buyer who couldn't wait to put it through its paces.

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1996 BMW M3 | eBay 1996 BMW M3 in E36 body. - fresh coat of paint done a year ago. - OMP racing seat. - full cage… Read more Read

2002 BMW M3 -$7,000.00 Bumpers, Door, and Repaint -1,400.00 Front Wheel -155.00 Oil Change/Filter/Spark Plugs/Valve Cover Gasket/Fuel Filter -250.00 Oil/Coolant Sensors -31.65 Expansion Tank/Fluids -130.93 Misc. Interior Pieces/Refinishing Materials -44.42

Fees/Insurance/Registration -750.00 Total Spent -$9,762 Sold for: $11,400.00 Profit/Loss $1,637.74

Although this one did take me a few months working primarily on weekends, it was a ton of fun and above all, therapeutic. It didn't gain me the net profit that I would've liked, but it was an amazingly fun experience nonetheless.

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Start your own car restoration adventure and make something freaking fantastic!

For more tales of buying low and selling high, check these out:

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Tavarish is the founder of APiDA Online and writes about buying and selling cool cars on the internet. He owns the world's cheapest Mercedes S-Class, a graffiti-bombed Lexus, and he's the only Jalopnik author that has never driven a Miata. He also has a real name that he didn't feel was journalist-y enough so he used a pen name and this was the best he could do.