We have received hundreds of email with questions about what the House and Senate has called the “Cash for Clunkers” bill. The term “Cash for Clunkers” is what America and the news media has used to describe a “credit” program to purchase new fuel efficient cars for the past six months.
The language in Cash for Clunkers bill gave the NHTSA the authority to implement the cash rebate system within 30 days from the bill being signed by the President. The official name for the program is called “Car Allowance Rebate System“ (CARS). The only official website for the program is http://cars.gov .
The official rules and conditions for participation in the CARS program are outlined on the official NHTSA website. The information presented on this page is for informational use only based on questions we have received. CARS program rules may change at any time so the http://cars.gov is the only definitive source for answers.
Summary of Cash for Clunkers Voucher Qualifications
1 EPA Combined MPG 2 under 6,000 lbs. 36,000 lbs. – 8,500 lbs. 4 8,500 – 10,000 lbs.
Type min fuel economy $3,500 Voucher $4,500 Voucher Passenger Car
22 mpg 1 Mileage improvement of at least 4 mpg
Mileage improvement of at least 10 mpg
Light-Duty Truck2
18 mpg 1 Mileage improvement of at least 2 mpg
Mileage improvement of at least 5 mpg
Large Light-Duty Trucks3
15 mpg 1 Mileage improvement of at least 1 mpg or trade-in of a work truck
Mileage improvement of at least 2 mpg
Commercial Trucks4
n/a Trade-in must be at least pre-2002
n/a
This FAQ page is by Appel Dodge Chrysler Jeep for consumers who have questions on the CARS program.
If you don’t qualify you may want to contact your legislator to request changes in the wording of the bill if additional funding is needed.
We have taken the best questions submitted by consumers and provided answers that we believe reflect the information provided on the CARS website as well as the text of the bill. You can validate all answers with us once the program starts or visit http://cars.gov.
If you have additional questions, after reading this page carefully, send us an email.
Q: Is the billed signed into law yet?
A: Yes the bill was signed by President Obama. The program is now in the hands of the NHTSA and they will be responsible for implementing the system for car dealers. The program is called CARS and the only official website is: http://cars.gov. Dealers will be responsible for signing up for the program, and participating dealers will eventually be listed on the government website.
Q: Are there updated conditions on the bill?
A: The purchased vehicles, which must be new (2008, 2009, 2010 models) and cost no more than $45,000, must be bought between July 1, 2009 and November 1, 2009 to qualify. You cannot trade in a clunker for a motorcycle. Your clunker has to be in driveable condition and car purchases before July 1st are not eligible.
Q: Where can I read a copy of the bill?
A: Click here to read PDF: http://www.cars.gov/files/CARS-Law.pdf
Q: How do I find the combined EPA mileage estimates on my old clunker?
A: Go to http://www.fueleconomy.gov/feg/sbs.htm and click on the model year of your vehicle, the make, and then the model. Under the words “ESTIMATED NEW EPA MPG” in the red banner, there is a red number with the word “COMBINED” under it. That is the new combined city/highway fuel economy for your vehicle. You may then enter the make, model, and model year of a new vehicle you may want to buy and see its combined MPG for comparison.
Q: Do I have to pre-qualify?
A: No. Your car only has to be qualified for the program. You can check if it qualifies on http://www.fueleconomy.gov/feg/sbs.htm. The CARS program does not require consumers to submit their information on the website.
Q: Will Appel Dealerships be participating in the Car Allowance Rebate System (CARS)?
A: Most new cars dealers in the USA will participate. We will have to register with the CARS program. Registration details have not yet been released. However, we are aware of the program and are waiting instructions from the NHTSA.
Q: How will the government limit fraud with CARS transactions?
A: The NHTSA is taking full compliance with program rules seriously. We have to register and be authenticated for the new car brands that we sell. All dealers will be responsible for following all guidelines set by the NHTSA and severe penalties will be issued for anyone who is committing fraud during the trade-in process or during the salvage process. You can read more about the NHTSA’s anti-fraud measures at: http://www.cars.gov/fraud-faq.html
Q: What do I need to bring to the new car dealership when I bring in my trade?
A: You should bring documentation establishing the identity of the person who currently owns the vehicle, preferably the title of the vehicle, and documentary proof that the vehicle “has been continuously insured consistent with the applicable State law and registered to the same owner for a period of not less than 1 year immediately prior to the trade-in.” The final rule will specify what types of documentation would be acceptable.
Q: Does the Cash for Clunkers bill apply to used car purchases?
A: Currently, the language of the proposed bill is only for new car purchases. If you are looking for a used car, click here.
Q: Is the value of the voucher tax-free to the consumer?
A: Yes. The CARS Act expressly provides that the credit is not income for the consumer. However, the credit will be considered as income for the dealer.
Q: Is there an income limit that disqualifies certain vehicle owners?
A: No.
Q: If I already purchased a new car, in the last few months, can the voucher apply to my past purchase?
A: No. Car purchases made prior to the official start date will not qualify.
Q: If my car is worth more than $4,500, how would the Cash for Clunker credit work?
A: The program would not provide any benefit if a car dealer would give you more than $4,500 for your trade-in. If you want to purchase a new car, do not wait on this bill if your trade is worth more than $4,500 since it will not provide any upside relief.
Q: If Appel is offering cash incentives toward a new car purchase, would that be in addition to this credit?
A: The CARS credit is independent from manufacturer buying incentives. For example, if a car dealer is offering $3,000 off the list price of a car and you qualified for a $4,500 CARS credit from your trade-in, then the total reduction off the MSRP would be $7,500.
Q: I have a car that qualifies for the cash for clunkers rebate but I still owe money on the title. Will this still work with the rebate? Can the cash rebate help pay off the title when I trade it in for a new purchase? It is registered and insured of course. I would like to get out from under this car loan and get a car with better gas mileage as required.
A: Right now the NHTSA is reviewing whether a car with a lien can qualify. See article.
Q: I have two old clunkers, can I trade-in both cars for a $9,000 credit toward a new car purchase?
A: The current wording of the bill would seem to indicate that only one CARS credit can be applied to a new car purchase.
Q: How do I know if I qualify for a $3,500 or a $4,500 CARS credit?
A: Click on this link to get your EPA mileage estimates from the Federal website: Click on this link: http://www.fueleconomy.gov/feg/sbs.htm. If you car gets a combined miles per gallon of 18 mpg or less, you can qualify as long as the car is not more than 25 years old. Your CARS credit amount would then be determined by the new car you purchase.
Q: What years constitute a “new” vehicle that qualifies for CARS credit?
A: According to the CFC Bill PDF, on page 7 item number 5B, vehicles of model year 2008 or later qualify.
Q: Can I go to the junkyard and buy an old car and use it for a trade?
A: Here is what the NHTSA says about what you need to bring to us when you buy a new car: You should bring documentation establishing the identity of the person who currently owns the vehicle, preferably the title of the vehicle, and documentary proof that the vehicle “has been continuously insured consistent with the applicable State law and registered to the same owner for a period of not less than 1 year immediately prior to the trade-in.” The final rule will specify what types of documentation would be acceptable.
Q: What will happen to the car I trade in?
A: The car will be sent to the salvage yard. Some parts may be kept but the engine and drive-train will be crushed.
Q: My car is old and originally was rated a 21 mpg, but now it gets 14 mpg. Will it qualify?
A: The program is based on the “combined” mpg estimates, a number in red, found on this link: http://www.fueleconomy.gov/feg/sbs.htm. If the number is 18 mpg or less, you can qualify if you meet all the other conditions.
Q: How long will the program last?
A: Right now the CFC program will most likely run from July 24th through November 1, 2009. There is no guarantee that the program will not run out of money sooner.
Q: Are there restrictions on the year of my trade-in.
A: The car can not be more than 25 years old.
Q: Why would some trades qualify for $3,500 and other trades get $4,500?
A: The difference in vouchers depends on the improved gas mileage of your new car compared to your trade. For example, if your new car purchase gets 4 mpg more than your trade you get a $3,500 credit. If the new car gets 10 mpg better than your trade you get $4,500 credit.
Q: What if my trade-in is worth more than $4,500?
A: This program does not apply to you because you will be better off trading the car in through traditional channels. All cars that are part of the CARS program will be sent to the scrapyard.
Q: I have an old clunker truck that gets under 18 mpg. Can I trade that in for a car that gets over 22 MPG?
A: It would seem that you will be able to trade it in. We will wait on the final wording on the bill since this is a very popular question.
Q: My parents own an old clunker. Can I transfer the title into my name and use it for a Cash for Clunkers trade-in?
A: The answer as of July 7, 2009 is wait until NHTSA lawers can make a ruling. Here is the exact wording in red. Notice that it doesn’t have to say that the person buying the car and the person who owns the car are the same person. This needs to be clarified since it could mean that if they are there with you when you buy, their car may be eligible and you could get the credit. I would call the NHTSA and ask for clarification on this, as of July 7, 2009 the NHTSA was still unsure.
You should bring documentation establishing the identity of the person who currently owns the vehicle, preferably the title of the vehicle, and documentary proof that the vehicle “has been continuously insured consistent with the applicable State law and registered to the same owner for a period of not less than 1 year immediately prior to the trade-in.” The final rule will specify what types of documentation would be acceptable.
Q: Can I lease a car or do I have to purchase/finance it?
A: Qualifying leases must be at least 5 years long. You can finance the car under any term you qualify for.
Q: Do you have to have good really good credit? If so, what does your credit score need to be in order to qualify ?
A: The CARS program is not linked to any credit approval process. You will have to qualify for a new car purchase based on your personal credit and the bank loan requirements at the dealer you visit. The CARS credit acts like a cash down payment. The rest of the approval process is between you and our financial sources.
Bonus Assistance
Q: How can I find out the current EPA MPG estimates for the car I drive?
A: Visit: http://www.fueleconomy.gov/feg/sbs.htm
Disclaimer
* This website cannot provide definitive answers on the CARS program. If you have any questions that will impact your purchasing decision, please contact http://cars.gov or a local participating car dealer.
