Consumer Car Buying Advice Blog

The Senate passes the bill for additional funds for popular CARS program

$ 2 billion more

At Auto Credit Express, we wanted our bad credit car loan customers to know that the Senate has just passed a bill that will add an additional $2 billion in funds to the Car Allowance Rebate System – more commonly known as the “Cash for Clunkers” program.

By the NHTSA’s estimate, this should allow an additional 500,000 customers to take advantage of the program, which gives consumers a credit of either $3,500 or $4,500 towards the purchase of a new, more fuel-efficient car or light truck (based on the approved vehicle list found on the CARS web site) when they trade in a “clunker” vehicle that averages 18 miles per gallon or less.

So far, so good

According to NHTSA estimates, CARS program sales through yesterday (Wednesday, August 5th) have passed the 180,000 mark. Given the current sales rate, Ray LaHood, Secretary of the Department of Transportation, estimates that the additional $2 billion will carry the program through a portion of September.

According to Senator Dianne Feinstein, an analysis of the first 120,000 sales shows that the fleetwide fuel economy average of new vehicles sold under the program is 22% higher than the average fuel economy of all new vehicles sold in 2008. Of those 120,000 vehicles, almost 60% were passenger cars.

In a press release, Senator Feinstein made this statement: “It’s clear that consumers are trading in their old, inefficient trucks for more fuel efficient vehicles. That’s really a credit to the American people who understand that the price of gas is on the rise and that improved mileage is important. So I believe that this program is good public policy if it can drive those decisions.”

Advantages for bad credit customers

There are a number of advantages that the “Cash for Clunkers” program holds for bad credit car loan customers:

• The vouchers act as an additional down payment towards the purchase price and can be added onto any existing rebates

• Many subprime lenders are treating the vouchers as customer trade down payments, reducing or even eliminating the amount of cash needed from the customer

• With the high interest rates lenders charge for subprime car loans, the larger down payment means, ultimately, lower interest expenses on these kinds of loans

• The better equity position that this additional down payment puts customers in means that many bad credit car loan customers will have a better chance of getting a loan request approved.

The Bottom Line

At Auto Credit Express, our business is to help people with bad, blemished, bruised and tarnished credit buy cars and reestablish their credit at the same time. Our national network of affiliate dealers specialize in bad credit car loans. If you have any additional questions, our web site will help you determine how much car you can afford and, unlike other sites, our toll free number is listed on every page in case you have any additional questions.

When you decide to buy a car, our credit application can be filled out in the comfort and security of your own home. For more information, visit www.autocreditexpress.com.

Tags: auto loan, car loan quote, credit bureau, credit card, Credit Repair, credit score, free car loan quote, free credit score, nhtsa, repossession, transunion

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