I don't think you can pass a technical inspection with a 500€ car. At least not in Germany.
Here the only cars you get for that price are obviously broken cars (accident, missing major parts, etc.) or cars that did not pass the inspection.
A Ford Fiesta 92 is around 500 euros in Spain. I don't know how is it in Germany, but here at Spain you even can get cars for 1000 wich are pretty decent and pass the inspection.