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Entry bubble Cash for Your Used Car

By: Joanne | June 30, 2009 | Category: Money

Car Allowance Rebate System (CARS) logoLast week President Obama signed the Consumer Assistance to Recycle and Save Act of 2009 into law. The new Car Allowance Rebate System (CARS) program offers cash to people who own old, fuel inefficient cars to help them buy new, fuel efficient cars.

Sounds interesting? You bet. Who doesn’t want to spend less money on gas, reduce greenhouse gas emissions, reduce our dependency on oil and increase energy sustainability AND get a shiny new car in the deal?

How does it work? Now that it’s a law, program details are available. Here are some quick facts – visit cars.gov for more details.

 

  • The amount of the credit is $3,500 or $4,500 depending on what you trade in and what you buy
  • Your car must be less than 25 years old
  • You must buy or lease a new car
  • Generally, your trade-in must get 18 or less miles per gallon (some very large pick-up trucks and cargo vans have different requirements)
  • Your trade-in must be registered and insured continuously for the full year before the trade-in
  • You don't need a voucher, dealers will apply a credit at purchase
  • Program runs through Nov 1, 2009 or when the funds are exhausted, whichever comes first.
  • The vehicle that you are trading in is required to be destroyed. Therefore, the value you negotiate with the dealer for your trade in is not likely to exceed its scrap value. The law requires the dealer to disclose to you an estimate of the scrap value of your trade-in vehicle.

 

Watch out, I’ve already heard reports that fraudulent websites have popped up, pretending to offer information about the CARS program but they’re really phishing for your personal information. Stick with the official CARS website for official program information.

p.s. Don't forget to submit your Independence Day photos on the USA.gov and GobiernoUSA.gov Flickr Group

| View Comments [16] | envelope E-mail This Entry | Tags: car   cars   cash   clunkers   efficient   fuel   joanne   new   trade   used  

Comments (16):

blue comment bubble Posted by thomas on June 30, 2009 at 01:42 PM EDT

My understand probably is wrong, but from what I have heard from the local car dealers that the salvage yards only have to scrap the engine and transmissions. The salvage yards can sell the rest of the vehicle parts as used parts. In the long run this can and probably will hurt the manufactures of new replacement parts. Then we can bail them out. Where is the money coming from for this program? I guess we can print more money and make it even more worthless. History has shown us that rampant spending with massive printing of money causes extreme inflation.

thomas

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blue comment bubble Posted by Joanne on June 30, 2009 at 03:54 PM EDT

I took a look at the text of the law, and it says: "SAVINGS PROVISION- Nothing in subparagraph (A)
may be construed to preclude a person who is responsible
for ensuring that the vehicle is crushed or shredded from-
-
(i) selling any parts of the disposed vehicle other
than the engine block and drive train (unless with
respect to the drive train, the transmission, drive
shaft, or rear end are sold as separate parts); or
(ii) retaining the proceeds from such sale."

So the people at the salvage yards can sell the parts. Maybe that won't be such a bad thing for the new parts manufacturers though - some people often buy used parts for repair, some always buy new parts. I always buy new parts, and I know I wouldn't start buying used parts just because there may be more available. Hopefully the parts manufacturers will be helped because new cars will be manufactured and sold and all those new cars have new parts.

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blue comment bubble Posted by Driving a TinLizzie on July 07, 2009 at 02:17 PM EDT

Cash for Clunkers” what a great idea! It will help spark the Automotive economy, the new “big 3”, the Tier 1 and the Tier 2 automotive suppliers.

I do have a problem with the MPG calculations, for the automobiles less than 25 years old (1985 thru 1999). The MPG should be at least 20’s MPG or below. This group are the high "Carbon Footprint" automobiles and should be removed from the road. I realize it is hard to please the masses but I feel some consideration should have been given to these old of cars.

I live in the Detroit area – I do not use highways to get to and from work. I usually work within 15 miles or less from my home and have worked steadily since 1983.

I have a 1997 Ford Thunderbird V6 with 135,XXX original miles. Mileage is calculated 45% highway miles and 55% local miles, 15,000 miles a year with an average MPG of 19 (just missed the 18 Mpg). My automobile does not get that. I drive 15% highway and 85% local miles and lots of winter driving.

You do not know how disappointed I was to find out that I did not qualify for the cash for clunkers. The MPG scale states you can customize for your area, but alas, the dealers say “NO”.

Automobiles with a more efficient reduced “Carbon Footprint” can get the cash for clunkers voucher without issue because it is an SUV ect. A 2008 Chrysler Pacifica is rated at 18 MPG.

I am in need of a new car, but will continue to drive the heavy “Carboon Footprint” car until it drops. With the current economy issues, car payments are not needed now.

I am hoping that the final instructions, that are coming out July 23, 2009, address issues of “Old Automobiles” from 1999 back and give a 1 to 2 MPG waver to qualify them and “GET THESE OLD CLUNKERS OFF THE ROAD”.

Thank you for listening to my opinion on the “Cash for Clunkers,

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blue comment bubble Posted by Lauren M. on July 12, 2009 at 05:06 PM EDT

I agree, I have a '95 Dodge Caravan with a 3.0L and it is listed as 19 mpg, the 3.3L was 18 mpg...I can't imagine more of a gas guzzling clunker than my van and I am very disappointed. I am hoping that there are not as many of these 18or less mpg vehicles out there as they think and they raise the limit. I had decided on a Kia Forte which would qualify me for the whole $4500.

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blue comment bubble Posted by Terry on July 12, 2009 at 08:24 PM EDT

People with clunkers have not owned there car or truck for a year they brake down before that and the people that have clunkers is they dont qualify for loans so this cash for clunkers has a slow start and will go no were, will this problem be fixed, I know of 300 people in my home town alone that tryed this cash for cluckers, and failed, because clunkers dont last a year, and financing is not out there for us. what will be done.

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blue comment bubble Posted by Mike on July 15, 2009 at 07:29 AM EDT

This scheme works well in Europe and UK, however, once it runs out, thats where real problems of Automotive industry start. Plus, because it is avaliable on VW, AUDI, BMW etc., american taxpayer might be helping European or Indian or Brazilian Automaker. No point, rather give tax breaks for small companies.
.
http://www.myvouchercodes.co.uk

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blue comment bubble Posted by jerry on July 16, 2009 at 02:26 PM EDT

My daughter has a 1999 audi with a combined milage of 19 miles per gal. Turbo doers not work, so there is no way the car gets 19mpg. They did do revise the details in this program. The car has over 150,000miles on it an she needs anouther car. Once again hard working americans get srcewed again.

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blue comment bubble Posted by Watch out on July 17, 2009 at 12:32 PM EDT

A lot of scams are on the Internet. Make sure you do your homework by checking out the official cars.gov website and read the most popular scams happening right now here: http://tinyurl.com/nlv3ed

Remember, you do not have to put in your social security number for a voucher. That is the major scam going on right now, taking your social security number online to steal identity.

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blue comment bubble Posted by this is gay on July 19, 2009 at 02:21 PM EDT

this is the dumest thing i have seen

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blue comment bubble Posted by John Embry on July 22, 2009 at 11:46 PM EDT

My thoughts are that this will definately stimulate new car sales, but that even with stimulation new car sales will be slow.

Secondly, it is disturbing that the vehicles taken off the road will not be available for salvage yards to pull used parts from. Buying used parts, after all, is one of the most environmentally friendly ways to keep vehicles on the road, and keeping vehicles on the road is always more environmentally friendly than producing a new one. What about companies like http://www.lowmileageengines.com that are going to have their business model impacted here?

This is great for Detroit, but it's going to hurt a lot of little guys.

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blue comment bubble Posted by John from Brooklyn, NY on July 31, 2009 at 01:27 PM EDT

I drive a 1993 Toyota with 175k miles and gets about 20 MPG real world milage. What the law makers have to understand is that these older cars which was getting 27 MPG when manufactured is probably now getting maybe 19 mPG. I too was hoping to get a new vehicle through the CARS program but will continue to drive my 16 rear old clunker thats get 19 MPG. They have to ammend the rule to include clunkers thats 16 years old but gets over 25 MPG. I personally know people who are driving old cars over 12 years old but don't qualify because they get milage in the 20's. Include those vehicles and the dealers and the enviornment will bebefit.

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blue comment bubble Posted by The_Duck on August 01, 2009 at 11:59 AM EDT

What people don't understand is that this program will NOT help low-income families who can't afford to have a car payment! Sure you get $3500 or $4500 trade in value, but you still have to pay for the rest of the vehicle! How can lower incomes do that?
For example : A family of 4 with only 1 adult working and the other unemployed, 2 small children in school. After they pay their mortgage, utilities, grocery bill, etc ... there isn't any money left over for a car payment! This is just dumb. Plain dumb. The only people who can afford to do this Cash for Clunkers are people who have the money to buy a car in the first place!
Let's get real America ! ! !

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blue comment bubble Posted by PMS on August 10, 2009 at 06:18 PM EDT

I agree with the DUCK, this program is for those who can afford it . The 4500.00 is only to make the deal. What's going to happen with all those people who realize they made a mistake. I think this is just like the mortgage problem, take off like a rocket and come down fast. What's next? bail outs for those who can't afford the notes anymore. I quess instead of foreclosures we will have repos on vehicles. There has to be a better way.

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blue comment bubble Posted by missed by 5 mpg on August 11, 2009 at 03:22 AM EDT

this program 'could' help people with old cars who need a new one, you can get a basic ford focus for around 8,000 and if you can get the 4500 off that and any other incentive being offered, you could pick up a 'new' car for around 3000 if you can scrape that up. i am on fixed income after working for 27 yrs. and now driving an 89 pontiac that does not qualify and i really need a reliable car but the chart says my car gets 23 m.p.g. i think the people who are being able to take advantage of this program are NOT the one's who really need it. i hope the guidelines will be changed so people like me with older cars and have a chance to get a new one. i would settle for even a 'new'(er) one.

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blue comment bubble Posted by vangelia whitaker on August 22, 2009 at 09:25 AM EDT

can anybody buy the clonkers

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blue comment bubble Posted by Joanne on August 24, 2009 at 09:23 AM EDT

The program ends tonight (8/24/09). Eligibility for the program is/was based on the fuel efficiency car you're trading in and the car you're buying. Program details are available at cars.gov

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