CASH FOR CLUNKERS

How to Scrap Your Rustbucket

November 10, 2014 by admin 2 Comments

Updated April 19, 2017.

Is your clunker headed to the scrapyard?

Remember the Cash for Clunkers program? Officially known as the Car Allowance Rebate System or CARS, this 2009 federal initiative encouraged owners of most passenger vehicles that were at least 25 years old to send them to scrap. Nearly 700,000 old cars were destroyed, providing a temporary boost to the economy as people used the money received to buy a new car.

Although CARS is long gone, there are still many more vehicles awaiting the junkyard, but the owners haven’t gotten around to sending them there just yet. If you are looking to scrap your rustbucket, you have some options available to you, including a few that could put a wad of cash in your hands.

Contact a Local Scrapyard

One person’s scrapyard is another person’s junkyard. Whatever you call it, these types of disposal areas are dumping grounds for mostly old vehicles as well as newer vehicles totaled in a car accident. Although junk piles are an eyesore, they provide a much needed place for people to search for car parts and at an attainable price. Most vehicles eventually are taken apart and the steel and other parts are recycled.

For the seller, you’ll need to possess the vehicle’s title to sell it to a junkyard. Then, contact several junkyards in your area to find out if they are interested in purchasing your vehicle.

You should know that you’ll usually get more for your vehicle if it is in drivable condition. The junkyard may fetch your car, but it could deduct some money to recover their transportation cost. Obtain prices and go with the yard that will offer you the most money for your rustbucket.

Your donated vehicle can benefit others. (Photo copyright Wheels4Hope.)

Search For a Charity

A number of charities are interested in acquiring your vehicle too, whether it is in running condition or not. If it is in working order or can be fixed and brought up to running condition, the repaired vehicle may be given to someone who needs one. Programs such as Wheels4Hope ask for such vehicles, then fix and resell them for a flat $500 fee to individuals who need a car.

The advantage of giving to a charity is twofold:

1), you’ll help someone get a vehicle that might otherwise not be in a position to afford one, and

2), you’ll receive a form from the charity, allowing you to claim a deduction on your federal tax return. You may find that the deduction is worth far more than what the scrapyard would pay for your ride.

Just Sell It

rustbucket Your car looks like a clunker, but you may also have a classic on your hands. Sure, it is rusting, has a broken window, the seats are torn and the dashboard is cracked. It doesn’t look like a lot, but it may be worth something to someone.

The worth of any old vehicle can be hard to determine, but Hagerty provides a valuation tool for classic cars that can help you determine just that.

For instance, a 1985 Buick Riviera Convertible with its 307 cubic-inch V-8 engine outfitted with a four-barrel carburetor would be worth an average $8,830 (as of Nov. 2014).

Of course, if your car is a clunker, its value would be far lower. Notably, Hagerty’s offers four vehicle conditions ranging from superior to fair. Thus, prices may range from about $6,000 to as much as $18,000 for the Riviera. A clunker still might fetch a few thousand dollars or far more than you might think it is worth. Offer your vehicle on eBay or Craigslist to gauge interest.

Your Rustbucket, Your Car

You may have a certain emotional attachment to your rustbucket, but unless you have a sensible plan in place to restore it, then scrapping, donating or selling it makes the most sense. Weigh all three options and choose the one that is best for you.

KBB Forecasts Used Car Price Bubble

August 10, 2009 by admin 1 Comment

Used car prices will often fluctuate depending on the popularity of the vehicle as well as other factors including the price of gasoline. Indeed, in 2008 owners of compact cars saw their prices increase as gasoline topped four dollars a gallon. Getting 30 mpg on the highway is certainly advantageous when pump prices are high resulting in an increase in used car values.

Fewer Used Cars Available

Kelley Blue Book (KBB) is seeing another factor play in with the used car market and that factor is the federal government’s car scrappage program. Called “cash for clunkers” by consumers, the Car Allowance Rebate System (CARS) program has already removed about 250,000 used cars from the market, with an additional 500,000 slated for scrappage as the program is extended thanks to two billion dollars in additional funding.

KBB says that the clunkers program is removing used car inventory at a faster rate which means that dealers are stocking up on used car inventory while they can. This quest for used cars is pushing up prices, creating a bubble scenario.

“Dealerships have reported increased foot traffic, creating a false sense of automotive market recovery,” said Alec Gutierrez, senior analyst of vehicle valuation for Kelley Blue Book. “As a result, dealers are going to auction to restock inventory, driving up used-car values. However, the effect of a supply reduction of this magnitude could have an immense impact on these values in the short-term, exacerbating the already-limited supply at auction. If this bubble comes to pass, dealerships will end up with excess inventory of both new and used vehicles and be forced to offer deep discounts to remove surplus inventory, driving values down. Ultimately, there will be the possibility of a severe contraction in auto sales as soon as the Cash for Clunkers program runs out of funding.”

Most Sought After Brands For New Car Buyers

KBB also found out in a recent survey that one in ten car shoppers have moved up their new car purchase thanks to CARS. The top brands being considered by people turning in their clunkers are Toyota, Ford, and Chevrolet.

The federal government’s program was supposed to end on November 1st or when funds ran out, but with only one billion dollars in initial funding, CARS was quickly overwhelmed by customers thanks to pent-up demand and huge deals on new cars.

Cash For Clunkers Doesn’t Go Far Enough

June 10, 2009 by admin 1 Comment

I am not one for seeing the federal government create endless taxpayer assistance programs, believing that the consumer is the best party to determine what he or she should buy. However, I’ve resigned myself to seeing Congress and the Obama administration spend money like no administration before it, supposedly in a bid to rescue us from the current economic slump or to pass new programs designed to expand government control.

Older models like the Ford Bronco may qualify under the federal government’s Cash For Clunkers law. However, your old ride must be scrapped or recycled and you’ll get just $3500 to $4500 toward a trade in.

Cash For Clunkers is one program that I want the federal government to spend money on for the simple reason they have been spending money everywhere else, but with little impact on the economy. Any program that actually puts cash in the consumer’s hand is better than tossing those funds at bankrupt financial institutions, car companies and other larger businesses who have failed. At least with the consumer you have someone who isn’t as likely to squander their monies, carefully choosing what they want to buy and how much they’ll pay.

House Bill Doesn’t Go Far Enough

However, I am disappointed by the Cash For Clunkers bill (H.R. 2751) that was passed by the US House of Representatives yesterday, one that will barely have an effect on the auto industry. True, eligible buyers will be able to use a voucher worth $3500 to $4500 toward the purchase of a new, fuel efficient vehicle, but the vehicle they must trade in has to get under 18 mpg.

Consider this — over the past decade or so, there have been only a handful of vehicles that return such awful gas mileage. Heck, even some editions of the Corvette get up to 28 mpg on the highway! Sure, a few newer models like the Ford Excursion and Hummer H2 qualify, but if you think that someone will trade these vehicles in for a paltry credit, that’s crazy. After all, qualifying vehicles must be scrapped or recycled and no additional monies will be given even if the book value is well above $4500 as it is for some newer versions of these models.

Your Dead Clunker Doesn’t Qualify

Lest you think that you can take that beater sitting in your back yard and trade it in, you’ll need to think again. An important requirement with this program is that vehicles must have been registered and insured for the past year to avoid having people push in inoperable cars for credit. Congress may have set aside four billion dollars for this program, but they’re not about to let unregistered and uninsured junkers qualify which is actually a good thing.

There is a chance that as the U.S. Senate takes up this bill, that some of the parameters will be changed. I believe sales would be stimulated if just about any older vehicle, let’s say eight or ten years or older was included in this program. As it stands right now, the law will provide a little bit of help, but nowhere the results that Germany and other European countries have experienced since launching their own scrappage programs earlier this year.

Cash For Clunkers is one of the better ideas floated in some time. I only wish that our elected representatives planned to offer one that would truly stimulate the economy as this version of the bill will have little or no effect.

See Also — How to Scrap Your Rustbucket

Source: Detroit Free Press

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