If you’ve been waiting at the edge of your seat for the finalized rules on the “cash for clunkers” program, then today is your lucky day. The National Highway Traffic Safety Administration has finalized and released the final rules for the $1 billion program to trade in your old vehicle for a credit of up to $4,500 towards a new vehicle. Below you will find some quick details, caveat, and lowdown you should know if you’re interested in the cash for clunker program.
The Car Allowance Rebate System (Cash for Clunkers) In Brief
Starting on July 24, 2009, car buyers will be able to take advantage of the CARS program and receive a $3,500 or $4,500 discount from the car dealer when they trade in their old vehicle and purchase or lease a new one.
Important Cash for Clunker Facts:
– Your vehicle must be less than 25 years old on the trade-in date.
– Only purchase or lease of new vehicles qualify for the program.
– Generally, trade-in vehicles must get 18 or less MPG (very large pick-up trucks and cargo vans will have different requirements).
– Trade-in vehicle must be registered and insured continuously for the full year preceding the trade-in.
– You don’t need a voucher of any sorts, qualified dealers will apply a credit at purchase.
– You will be eligible for any other advertised rebates or discounts by the dealer in combination with the credit you receive through the CARS Program.
– Program runs through November 1st, 2009 or when the funds are exhausted, whichever comes first.
– Just added rule: The program requires the scrapping of your eligible trade-in vehicle, and that the dealer disclose to you an estimate of the scrap value of your trade-in. The scrap value, however minimal, will be in addition to the rebate, and not in place of the rebate. (Dealers are allowed to keep $50 of scrap value to cover their administrative cost).
– Only new-car dealers can issue the credit, and they must have an active franchise agreement with the manufacturer. This means that used-car dealers can’t issue the credit, nor can any new-car dealer that has lost its franchise (e.g., many recent Chrysler and GM dealers).
What You Need to Bring to the Dealer:
– Proof of Registration going back at least 1 year.
– 1 Year Proof of Insurance. If your insurance card does not cover the entire year preceding the trade in, you will need other proof of insurance. Contact your insurance company to get evidence of 1 year worth of insurance. The form must include, at a minimum, the insurance company, policy number, VIN, start and end date of insurance (showing at least 1 year).
– “Clear” title. This means the title must be free of any liens or other encumbrances. If you have liens, you need to get these cleared before going to the dealer. This may include evidence on the face of the title showing no lien; that the title has been cleared (signed and stamped accordingly), or with an attached lien release from the lien holder.
– The vehicle manufacturer date found on the driver’s door or door jamb is less than 25 years old when you trade it in.
Is Your Old Clunker Eligible for Trade-In?
As you may have noted above, only vehicles less than 25 years old that gets 18 MPG or less can qualify for the CARS program. Luckily for everyone, there are two great resources you can check to see if your vehicle qualifies for the “cash for clunker” program. Edmunds.com has compiled an large list of eligible trade-in vehicle list, and has saved you time by omitting vehicles with trade-in value better than$4,500. Because each individual may still different in its trade-in value, you can check the official CARS website to see if your vehicle is eligible by visiting the eligibility tool the government has setup (be warn that the site may be slow to load as its under heavy usage).
Beware of Cash for Clunker Scams
The official name of the program is called “Car Allowance Rebate System,” and there is only ONE official website from the government, the NHTSA’s CARS.gov website. As per rules listed out above, you DO NOT have to register or apply for any part of the program, those are done on the dealer-end, so beware of any official sounding websites asking for your personal information.
Still Confused? Get Official Answer from the NHTSA
The NHTSA’s CARS.gov website will have majority of the information you’ll need. The full FAQ can be found at www.cars.gov/faq. You can also call the CARS Hotline at 1-888-CAR-7891 or the TTY/TDD line for the hearing impaired at 1-800-424-9153. If you’re a dealer and you’re looking for more information, check out cars.gov/dealersupport for more details.
top photo credit: youngthousands