Cash for Clunkers $4500 CARS Rebate Program Ends
Final Days of the US New Car Allowance Rebate System (C.A.R.S.)
Jul 10, 2009
The U.S. Government's CARS program finalized on July 24, 2009 originally applied to qualifying transactions between July 1, 2009 and November 1, 2009 or until the funds are exhausted, whichever cames first. On July 31, 2009 the response to this program had been so great that the US Government added another $2 billion to the program to keep it going and were discussing a possibility of keeping the program going indefinitely. However program leaders announced that August 24, 2009 would be the last day for the program and that dealers had until 8:00 pm to file their last remaining credits.
The CARS program issuee either a $3,500 or $4,500 as a credit to car owners who were purchasing new cars if their previous vehicle met certain requirements. The amount of the credit depended on the type of vehicle being purchased and the difference in gas mileage between the new car and the old one. Although some called it a "voucher" there was no voucher for the program. The money was simply taken off of the purchasers agreement at the time of the sale or lease and that money was to be reimbursed to the dealer by the US Government.
Requirements of the Trade-In Vehicle for the Car Allowance Rebate System
In order to qualify for the rebate, the vehicle that was being traded in must have been less than 25 years old on the date of trade-in according to the information sticker inside the door frame of each car that states the exact manufacture date), and must have gotten 18 or less “combined” MPG (some vehicles had different requirements – trucks and cargo van owners were to check the CARS information site for exact details.)
To find out the “combined” MPG of a certain vehicle, the car owner can go to the US Government's Fuel Economy Website and look up the new “combined” MPG of a vehicle.
Trade-in vehicles also needed to have been registered and insured to the same owner for a full year prior to being traded in and the person purchasing the new vehicle must have been that same person. The insurance requirement did not apply to residents of New Hampshire or Wisconsin since these states do not require owners to have insurance.
The vehicle must have been in drivable condition. Trade-in vehicles must also have had a clear title, free from liens or other encumbrances. The CARS program was only good for one vehicle per person.
Every vehicle that was traded in will be destroyed as a stipulation to this rebate. The estimated scrap value of the vehicle was to be added to the total trade-in value. Contrary to previous statements, the rebate was in addition to the trade-in value, not a part of it however the only trade-in value that was accepted was the scrap value – which each dealer should have provided to each new car buyer in writing).
The value of the new car being purchased could not exceed $45,000 and must have met mileage requirements set by the National Highway Traffic Safety Administration. There was no restriction as to whether the vehicle being traded-in or being purchased was a domestic or foreign vehicle. They could have been either.
How to Use the Car Allowance Rebate System
Car dealers around the country had been notified about the criteria and exact details of how the program was to work. There was no voucher for this program and it was up to the dealer to be sure that all criteria was met in order to get their refund. The car owner was able to go to any participating car dealership and trade-in their vehicle on a purchase or lease of a new vehicle that met the requirements. Many of the car companies also offered additional discounts or rebates and discounts to those who did not qualify for this in an effort to increase car sales.
New car dealers must have been registered for the program – a list of registered dealers can be found at the CARS website at http://www.cars.gov. The program also required that dealers were registered in their states to sell new cars.
At the time of purchase or lease of the new vehicle the qualifying dealer was to give the credit to the purchaser. Once the car had been purchased or leased, the dealer would then apply for reimbursement from the government. Some complained that they were not being reimbursed by the government, but this was stated to be a case of dealers not understanding how to fill out the paperwork. Incorrectly filled out reimbursement forms were being returned to the dealerships to have them corrected, which in turn, slowed down the process of receiving payments.
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