Most people have probably heard about the "Cash for Clunkers" government program. Exact details of the program were unknown until the 135 pages of rules were provided last week.
A brief overview of the program is as follows;
The eligible "clunker" has to be in running condition, able to be driven, and can't be more than 25 years old. An exception to this rule would be very large pickups and vans (defined as 8,500 to 10,000 pounds of gross vehicle weight) that must have been built since 2001.
The program runs through November 1st and is retroactive to July 1st.
You must have owned your "clunker" for at least a year and be able to prove it. You must be able to show proof of insurance for the previous year.
"Clunkers" must get get less than 18 miles per gallon (mpg) combined fuel economy, as rated by the Environmental Protection Agency. The new car being purchased must obtain at least 22 combined mpg, a new truck or SUV must be rated for at least 18 mpg. The program only applies to new vehicles being purchased.
Here is where the cash part comes into play: If your "clunker" is traded for a new car that achieves 4 to 9 miles per gallon better fuel economy, the cash credit is $3,500. If it gets 10 mpg or more better than the old car, the credit is $4,500. If you are trading in an SUV or pickup and want to buy another similar vehicle, you get $3,500 if there is only a 1 mpg improvement, and $4,500 for a 2 mpg or more improvement.
All "clunkers" traded in under the program must be destroyed, not resold.
The government web site for the "Cash for Clunkers" web site is www.cars.gov .