CARS program, can I buy another car?

[RodJo]

Originally Posted by cwerdna

Assuming the FAQ at Cash for Clunkers Car Buying Stimulus Bill is correct, the answer is no, you can't do that. The URLs below also basically say the same thing.

If you actually buy the car from a third party, you cannot turn around and trade it in (it needs to be registered to and insured by a single person for the last one year). What you may be able to do, however, is to pay the owner of the clunker $500 to sign it over to the dealer toward the purchase of your new car. It's more workable when a family member owns the clunker because otherwise the owner of the clunker would probably just want a bigger piece of your CARS credit, thus making such a deal less attractive. Anyway, unless I'm missing something, the statute and FAQ's do seem to anticipate that scenario as discussed in previous posts.

[darkleafar]

Originally Posted by RodJo

If you actually buy the car from a third party, you cannot turn around and trade it in (it needs to be registered to and insured by a single person for the last one year). What you may be able to do, however, is to pay the owner of the clunker $500 to sign it over to the dealer toward the purchase of your new car. It's more workable when a family member owns the clunker because otherwise the owner of the clunker would probably just want a bigger piece of your CARS credit, thus making such a deal less attractive. Anyway, unless I'm missing something, the statute and FAQ's do seem to anticipate that scenario as discussed in previous posts.

does anybody know if this is possible? I was actually thinking of trying the exact same thing. My mother wants to get rid of a 97 explorer XLE. Ill give my mom 2000 or so for it, then she trades it in towards my Prius and I get a 4500 rebate. Therefore, I earned 2500 towards my Prius. And since I plan to do a down payment of 10000, then that would be 12500 down. Anybody can confirm if my plan would work out?

[scottwyden]

I'm really hoping that DCH honors the Car Allowance Rebate System program. My Prius most likely won't be in the my hands until August and my G35x gets less than 17 mpg average

[scottwyden]

I didn't realize the dealer would literally give you scrap $$ for the trade in.. Guess that's out of the question

CARS.gov - Car Allowance Rebate System - Helpful Q&As for Consumers - Formerly Referred to as “Cash for Clunkers”

[Jabber]

$50 bucks is all you will get.. and some dealers are already talking about the amount of money that we have to pay in income tax on the money you receive. So the discount on the car will be less if you use the cash for clunkers program. The customers will get the money tax free. They are going to tax the dealers since we are the ones to receive the money (even though we pass it along to the customer)?? The more I read about this program, the more I am beginning to hate it, speaking strictly from a business standpoint. I love the idea, and the customers will benefit greatly. But the logistics behind it is a nightmare for the dealers.

[TomInOregon]

Originally Posted by greylar

You're right it might not be a loophole since the spirit of the law is not really being violated if a different person is doing the trade in than the one buying the car. Its just been widely reported and assumed that they had to be the same person.

G

How is the spirit of the law not being violated? If the original owner (and driver) of the car trades it in for a more fuel efficient car, that's great. If the original owner trades it in for someone else's new car (someone who already gets better MPG) and then turns around and buys another clunker, that's not the spirit of the law.

Under this scenario, someone can trade their 18 MPG SUV to help someone trade out of their 19MPG car into a 23MPG new car, then turn around and buy a 12 MPG truck because it meets their needs and you can get great deals on trucks nowadays.

Is this a likely scenario? Not necessarily, but I guarantee it would happen at least once. By the same token, I guarantee in another instance that both parties would trade up into much more efficient vehicles. Leaving a loophole like that results in possibilities for a net efficiency loss at the end of the program, however unlikely that may be. Closing the loophole guarantees a net gain.

Tom

[ddtaylor99]

Jabber,

You mean social engineering and nani-statehood are the best ways to run a country? Peoples republic of USA doesnt grab you?

So what's the answer to the burning ? -- Can you trade in somebody else's clunker when you buy a new car?

dt

[TomInOregon]

Originally Posted by Jabber

$50 bucks is all you will get.. and some dealers are already talking about the amount of money that we have to pay in income tax on the money you receive. So the discount on the car will be less if you use the cash for clunkers program. The customers will get the money tax free. They are going to tax the dealers since we are the ones to receive the money (even though we pass it along to the customer)?? The more I read about this program, the more I am beginning to hate it, speaking strictly from a business standpoint. I love the idea, and the customers will benefit greatly. But the logistics behind it is a nightmare for the dealers.

I believe the $50 bucks is what the dealer is guaranteed out of the scrap value in order to pay for associated costs/having the vehicle moved to the scrap yard. Any scrap value above the $50 belongs to the customer and can be negotiated with the dealer on the price of the new car.

Tom

[Actor with a Prius]

Hey everyone! Im new on this forum, about to get a 2010 Prius III and I'm super excited!! I too am participating in the CARS program, I'm trading in one of my 300ZX's, I have a Twin Turbo, rebuilt and modified 500+ hp - probably getting 6 mpg haha) and my daily driver a JDM 94 N/A that on the government website says it gets 18 mpg average (Thank God it meets the criteria!)

I have done extensive research on this subject. Here is what I know...

1) the car being traded in has to have been registered in the name of the person getting the NEW car for at least 12 months prior.

2) the car must have been insure for at least 12 months prior.

3) the car being traded in must be in drivable condition

4) the new car being bought has to be less that $45,000

5) the dealer, by law, has to tell you what your car is worth for scrap metal. (how u can attest the truth of their claim, i have no idea)

6) The money given by the Government is not taxable income to the person, its taxable income for the dealer.


So, no you cannot buy that $500 minivan on craigslist and get $4,500 for a new car. I think that's the whole reason why the program has been pushed back from the 1st of July till the 23rd. They are trying to avoid fraud and whatnot. I guess they want to stimulate the economy by provoking new car sales, and getting old gas guzzlers off the road, but they dont want to give away free money to anyone that goes and buys a clunker then turns around and trades it in. I mean, in that case anyone could just spend $500-1000 on a cheap POS, and then get $4,500 for a new car. Would be nice tho. haha.

As for the family member trading in the car, the new car would have to be under their name then. So I don't think you can get your mom to trade in her car, and you get the rebate.

Oh....the NEW car also must be registered under the person who traded in their clunker for at least a year, and if you lease, it has to be a 5 year lease.

Hope this helps !

[Jabber]

Actor, you are dead on.

You cannot trade in a car that is in someone else's name unless you want them to be on the title of your new car. Even if it is just a family member. That is called "jumping title". If you think you will buy a car on craigslist, and trade it in to the dealer, you are wrong. The dealer will not accept a title from a third party. A) Taxes were not paid on the vehicle by the party trading it in. Big state no-no. If the third party ever comes back and says he never traded in a vehicle, the dealer loses. Not only are we going to be on the hook for the CFC money, but also the value of the car we sent to the junkyard. Since most dealers don't like this program because of all the hoops the government is going to make us jump through, not to mention the extra tax we have to pay, no dealer is going to be willing to bend a few rules to let you get the money. Dealers will want this to be a completely straight deal with no "fur" on it. Not even a little peach fuzz...