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Friday, August 21, 2009
Some Tips for Last-Minute 'Cash for Clunkers' Hopefuls
By Dunstan Prial
FOXBusiness
The 'Cash for Clunkers' program ends Monday and dealerships are justifiably expecting a rush of customers hoping to cash in on their beat up old vehicles over the weekend before the wildly popular program expires.
After burning through nearly every penny of its $3 billion in funding in just a month, the program will shut down at 8 p.m. Monday. All new deals will have to be completed and dealers must file their paperwork by the deadline in order to get repaid for the big incentives.
But before you duct tape together that clunker for one last ride, consumer advocates are asking that you step on the brakes long enough to make sure you’re getting the best deal.
Edmunds.com, one of the largest Web sites for car information, released some tips Friday to help consumers out.
Call ahead to make sure your dealership is participating. Many dealers have dropped out because they’ve had trouble getting repaid for rebates offered to consumers and guaranteed by the government.
Make sure the paperwork you sign is the paperwork required by the government. Any other paperwork could tie you to shady deals concocted by shady dealerships.
Remember to negotiate a good price for your new car. Edmunds.com says many Cash for Clunkers participants have paid more than they should have for their new cars because they were distracted by the government rebates.
Get your old car appraised to make sure it’s worth less than the Cash for Clunkers rebate.
The Toyota Corolla is the most popular car purchased under the program, followed in the top three by the Honda Civic and the Ford Focus, according to data released Friday by the Department of Transportation.
Over half of the top 10 new cars purchased through Cash for Clunkers were made in the U.S., according to the report.
The biggest clunker was the Ford Explorer, followed by the Ford (F) F150 pickup and the Jeep Grand Cherokee.
President Barack Obama and administration officials declared the program a success Thursday, saying it has revitalized the ailing auto industry and finally brought reluctant car buyers back to dealership lots. U.S. auto makers such as Ford (F), General Motors and Chrysler have all benefited. Originally a $1 billion program, Cash for Clunkers was boosted to $3 billion in early August after heavy customer demand nearly depleted its funds in just one week.
There have also been problems, especially for dealers, many of whom have yet to be repaid for the clunker deals they have made. Under the program, dealers take rebates of $3,500 or $4,500 off the price of a new car in return for older, less fuel-efficient trade-ins that are sent to the scrap heap. They then must submit a 13-page application with proper documentation of the sale in order to get repaid.
That has left many dealers with unpaid claims worth hundreds of thousands of dollars
Nevertheless, a Democratic Senate aide told FOX News on Friday that the Senate might consider jump starting the program once Congress returns from its break in September.
“It was a good program for our economy, our environment, and consumers. In the coming weeks we hope to hear the White House's reports on what this program has accomplished and its views on how to proceed. We can then make an informed decision about what to do legislatively in September when we return,” the aide said.
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