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NHTSA Changes Rules On Killing Clunker Trades
As we have written in the past, it seemed odd that the engine blocks of “clunker” trades had to be “killed” before a trade was submitted to the NHTSA for reimbursement and approved.
This practically prevented any trades to be reversed if the NHTSA rejected a Cash for Clunkers submission. The rule created a liability for car dealers and consumers. Thankfully, cooler heads have prevailed
New CARS Rulings
Here is the email that we received from a car dealer from their trade organization called AIDA:
The National Highway Traffic Safety Administration (NHTSA) has established new rules – effective immediately – for the Car Allowance Rebate System (CARS). The changes made to the rule NHTSA published on July 24, 2009 refer to the engine disablement process and proof of insurance for the states of Wisconsin and New Hampshire.
Because of overwhelming concern from dealers, NHTSA has amended its rule to allow dealers to submit CARS transactions prior to killing the trade-in vehicle’s engine block. However, disablement must still occur before the
trade-in leaves the dealer’s property.The certifications on the Summary of Sale form have been amended to reflect the adjusted requirement concerning engine disablement, and the certifications on the electronic form submitted by the dealer will be changed accordingly in the near future.
In addition to the new engine immobilization requisite, NHTSA has made an exception for the states of Wisconsin and New Hampshire with regards to insurance verification – also effective immediately – that proof of insurance is no longer required.
Cash for Clunkers Updates
Stay tuned for the latest updates on the Cash for Clunkers program by visiting this website or by following us on Twitter: http://twitter.com/cashclunkers
Consumers who are considering purchasing a new car under the program can download our CARS Consumer Checklist to make sure that you bring all the necessary documents to your local dealer.
15 responses on “NHTSA Changes Rules On Killing Clunker Trades”
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after 5 days dealer asking take the new car back because the clunker is not qualify. (all my doc is good, the problem is the title say 1984 and but the manufacture 1983. dealership are the one verify all the doc). Can thay do that?
Mark, I agree completely. why not have given an incentive to anyone to buy a fuel efficient car. maybe a better idea then just bailing out GM.
mY WIFE AND i ARE JOINT OWNERS OF TWO “CLUNKERS”. wE WANTED TO GET TWO NEW CARS: ONE VOUCHER FOR EACH TRANSACTION. wE WERE TOLD WE, AS JOINT OWNERS, WERE LIMITED TO RECEIVING ONLY ONE VOUCHER.
I THOUGHT THE PURPOSE OF THE PROGRAM WAS TO SELL CARS AND GET “CLUNKERS” OFF THE ROAD. I DIDN’T REALIZE THE PURPOSE WAS ANOTHER GOVERNMENT PROGRAM THAT DISCOURAGES COUPLES FROM GETTING MARRIED.
The only way to insure these cars don’t get back on the road is to remove the VIN plate and supply VIN numbers to all states so they won’t be licensed
This program is hurting the used car dealers who won’t be able to find cars for under $4ooo.oo!! When the government gets involved with private business they screw everything up and do more harm than good. If thier objective was to sell more new cars they should allow “WE THE PEOPLE” to participate by giving any new car buyer a $4ooo.oo voucher without a trade-in. that is better for the used car dealers and it will sell more new cars than the current program which decriminates against the American who does not have a clunker to trade. What about “We THE People”??????
I have an eligible cash for clunker Ford Explorer. It qualifies for $4500 towards a new car or small truck.
This Explorer is in my name and my mothers name jointly. The insurance has been in my name only for years.
My credit sucks out loud and I can not qualify to buy a bicycle but my mother has A-1 top credit so she was going to just do the deal on herself since she is joint owner on the explorer.
I was told by one dealership that beacuase the insurance was in my name and not her name that she is not eligible even though she is owner of the vehicle.
Anybody have any experience with an issues like this one? Why should it matter who had the insurance on the vehicle as long as it was insured?
Heck, I really did not know about this program and dropped the insurance on my clunker when I put it up for sale last month when it developed a coolant leak (after 5 years of insuring the thing). That requirement really vacuums.
The gas milage thing really hurts. I am on the border of it.
Neil, Just put the wifes car in both names and you can use your credit and her klunk.
Why do they make a system that can have loop-holes? In most of the states they can make the title of the clunker an UNREBUILDABLE TITLE. This makes the car unable to be tagged ever again by the VIN but the part dealers can sell all the parts off of it. They make insurance companys do it for totaled cars that junk-yards buy for parts.
Can I be the buyer of the new car even though my wife is the registered owner of the clunker? Since I have better credit, we can get a better deal on the purchase or lease; but my name is not on the clunker’s registration, even though it is on the same insurance policy, address, etc., as my car.
The rule seems to be that the new-car buyer must be the same person who owns the clunker; but shouldn’t there be a spousal exception?
It is unfortunate that you cannot qualify with a vehicle that gets better gas mileage than the maximum allowed under the program, even if you are buying a new vehicle with MUCH better fuel economy. However, it does make sense from the point of view of getting cars with the worst fuel economy off the road. If you get the rebate for your car, then that money is not available for a more deserving (worse gas mileage) clunker. Meanwhile, your old car has some resale value, and could be purchased by someone who will use it to replace their old clunker (which could then end up in the junkyard).
My turbocharged Subaru Impreza does not qualify because it is 3 mpg over the 18 mpg requirement to be a clunker. I just bought a new Toyota Prius that gets 51 mpg. I think the 30 mpg difference between my trade in and the new car I’m buying should have qualified me for the rebate. Isn’t the idea behind the bill to put more energy efficient cars on the road in place of low efficiency cars?
can you tell me, do I not qualify because I am a cooperation? I see nothing disqualifying me yet my dealer questions it?
The class 1,2,3 idea is wrong; I would like to replace an old farm truck with a new 40 MPG car for my daughter, a new college graduate. What’s wrong with this? Why limit the program in this way? We want to trade 15 MPG for 40- isn’t that the point?
I hope NHTSA can change the rules. I don’t WANT another big truck.
Most of the dealers I deal with were waiting to kill the engines anyway, because they were really worried they were not going to get paid, & didn’t want to be stuck with a trade-in with a bad engine.