Correct, and half of people pay below the average. You do not need to pay $700/mo for a car, many are available for much, much cheaper. If your finances can only swing $400/mo, buy a $400/mo or a $300/mo car.

Maybe, but the average car payment for people who don't take out loans to buy cars is... Zero.

Used Buicks from the 2000's can be had for around 3 grand and are very reliable if they have the 3.8l engine. Insurance is often less then 400 a year.