In case you haven’t heard, I just wanted to point out that President Obama recently signed the so-called “Cash for Clunkers” program into law. Starting July 1st, would-be car buyers can get a $3500-$4500 credit for trading in their “clunker” and purchasing a more fuel efficient vehicle.
Officially known as the Car Allowance Rebate System (CARS) Act, the “Cash for Clunkers” program is intended to: (1) get gas guzzlers off the road, and (2) stimulate new car sales. We’ll just have to wait and see how well it works on both accounts.
Details of the Cash for Clunkers program
According to the official CARS website:
- Your vehicle must be less than 25 years old on the trade-in date
- Your vehicle must be in drivable condition at the time of trade-in
- Only purchase or lease of new vehicles qualify
- Generally, trade-in vehicles must get 18 or less MPG (some very large pick-up trucks and cargo vans have different requirements)
- Trade-in vehicles must be registered and insured continuously for the full year preceding 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
- You can combine the CARS rebate with other State and Federal incentives, such as the hybrid vehicle credit
- Not all dealers will be participating in the program, so check before buying
- The vehicle that you are trading in is required to be destroyed
Note that, because your trade-in will be destroyed, the dealer is unlikely to offer you more than its scrap value. Still, for a crappy old car, the scrap value plus the $3500-$4500 credit might be worth taking advantage of.
Another point to keep in mind is that, while transactions taking place on or after July 1st will qualify, full details of the program won’t emerge until later in the month. Thus, you might want to wait a bit before jumping on this.