Cash for Clunkers Bill

From LoveToKnow Cars

Interested in the Cash for Clunkers Bill? This program, introduced by the US government in July of 2009, will fund three billion dollars towards getting gas guzzling vehicles off the road. The Cash for Clunkers program was intially to run from July 24, 2009 through November 1, 2009. Due to the large popularity of the Cash for Clunkers program, the Department of Transportation (DOT) released that the program will end on Monday, August 24, 2009 at 8:00 PM. Not surprisingly, car shoppers have already burned through the allocated three billion dollars the CARS program provided.

href="http://www.fueleconomy.gov/" target="_blank" class="external free" title="http://www.fueleconomy.gov/" rel="nofollow" target="_blank" >http://www.fueleconomy.gov/ Do You Have a Clunker?

This program has helped consumers purchase more fuel-efficient vehicles by trading in their old clunker, gas-guzzling cars, vans, trucks, and SUVs. As an update to this article, the Cash for Clunkers program is allowing the rebate money to be utilized on ordered cars due to the depleting inventory at dealeships. The requirement is that you must have a signed finance contract in order to use the rebate money. Get more information on this new update at Cars.gov.

How the Cash for Clunkers Bill Works

There are some rules to the Cash for Clunkers program and most dealerships are participating in it. Also known as the Cash Allowance Rebate Systems or CARS, the program is open to all automotive manufacturers covering both foreign and domestic vehicles who have registered with Cars.gov. Here’s how it works:

The Clunker – Your clunker, or the vehicle you want to trade in, must be in drivable condition and have a combined fuel efficiency of eighteen miles per gallon or less. It must also be twenty-five years old or newer to be eligible as a clunker. Finally, the vehicle must have been continuously registered and insured in the state where you reside for at least one year. If you’re unsure if your vehicle qualifies, you can ask at any participating dealership or visit the EPA's website.
The Cash – The cash comes in two rebates, $3,500 and $4,500. To get the $3,500 credit or cash allowance, your trade in must achieve eighteen miles per gallon or less and the new vehicle you are purchasing must get at least twenty-two miles per gallon. Finally, the manufacturer suggested retail price (MSRP) of the new vehicle you purchase must be less than $45,000. To get the $4,500, your clunker must have a fuel economy of eighteen miles per gallon or lower and the new car you want to purchase must have a fuel economy rating of at least ten miles per gallon higher than the clunker you used as your trade.
New Vehicle Selling Price – To help calculate your monthly payment on a new vehicle, the selling price will be determined by subtracting your trade-in allowance and your clunker cash allowance. For example, a new vehicle that costs $20,000 will have your trade-in allowance subtracted, say $5,000, and your rebate allowance subtracted, say $4,500. The final new vehicle selling price before any tax, title, dealer or registration fees will be $10,500. Keep in mind that the Cash for Clunkers program does not cover fees to license, title, or register your new vehicle.

Other Program Rules and Tips

To fully understand the Cash for Clunkers program, you can visit the CARS website and print and read a copy of the official rules.
Vehicles that are considered off-highway vehicles or vehicles that carry ten or more passengers are not eligible.
There are four classes of eligible vehicles, passenger cars; category one trucks; category two trucks; and category three trucks. The passenger car and category one-truck classes will cover most vehicles including SUVs. Category two vehicles must have a wheelbase of 115 inches or less for pick-up trucks and 124 inches or less for vans. Category three vehicles include large pick-up trucks and vans with a cargo space of 72 inches or less.
Dealerships and manufacturers are not required to offer you the retail-selling price for your trade in. If you found a value for your clunker in Kelley Blue Book, expect to be offered a lower value for your clunker, as the dealership can’t resell the vehicle. Expect to be offered a wholesale value or lower for your clunker.
According to the Cash for Clunkers Bill, your trade in must be dismantled and disposed of by an authorized dismantler. Dismantlers as well as dealers are required to register at the CARS website.
You may not take any original manufacturer parts off of your clunker before you trade the vehicle in. If you take custom wheels, rims, or sound systems from the clunker, keep in mind that the value the dealer will give you will be less.
Dealerships must make you aware that fifty dollars of the either $3,500 or $4,500 they receive will be utilized towards dismantling or crushing your clunker trade in. You are not required to pay a dismantler fee.

Visiting the Dealership

While all dealerships are eligible to participate in the Cash for Clunkers program, if they register, they do not have to participate. Due to the rapid use of the allocated three billion dollars the program has allocated, some dealerships are asking customers to sign waivers that state if the dealer does not receive the cash allowance from the CARS program, the customer will pay it. Avoid dealerships that ask you to sign such a form. While it may take time for the dealership to receive the money, they are guaranteed the money until the government stops the program or until November 1, 2009, whichever comes first.

The CARS or Cash for Clunkers Bill has enabled many people to purchase more fuel-efficient cars at highly discounted prices. Again, to find out if you have an eligible clunker to use as a trade-in, visit the EPA website. Good resources for the Cash for Clunkers rules are CARS.gov and the Official Rules.

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