Cash for Clunkers - why does congress hate me ?

[kvrdave]

Originally Posted by Bandoman

Exactly. I was going to be buying a new car next year, but will almost certainly accellerate that if Congress funds the CARS program again. My 95 Odyssey gets 18 mpg city, so it should qualify. Thank you, President Obama and Congress!

I believe it is the average, so you may be screwed.

[orangecrush]

Originally Posted by Bandoman

Exactly. I was going to be buying a new car next year, but will almost certainly accellerate that if Congress funds the CARS program again. My 95 Odyssey gets 18 mpg city, so it should qualify. Thank you, President Obama and Congress!

I would be surprised if your 95 Odyssey isn't worth more than $4,500 right now. Those vans never seem to go down too much in value.

[JOE29]

Originally Posted by fujishig

.
And I can't be too mad, if they had some kind of program to trade in CRTs and upgrade to flat screen televisions, I think I would take advantage of it...

I didn't vote for Obama, and I'm not planning to next time ( Although I think he will win re-election ) But i'm going to take advantage of anything I can to make things better in my life. To date I haven't needed any of his programs to better myself, yet. I don't need to get into the Clunker rage as I don't need a new car OR ANOTHER CAR PAYMENT. But when and if the time comes that I do need to take advantage of some government help like this, I will.
I understand I will be a hypocrate but so what, I don't care.
If they're going to throw money around like this for other things later on sooner or later i'm going to have my hand out too.
You have to take advantage of things that can improve your life when you can reguardless of your ideology. So if buying a new car with government help, helps you out, go to it baby. All I ask is don't come crying to me if you can't make your car payments a year later ( another bailout ).

[mbs]

Originally Posted by CreamyGoodness

Wonderful. A government plan to give money to people, like you, who don't need it.

What a country!

On a side note... I wonder how many of the people taking advantage of this are the same people who complain about Obama being a socialist..?

If it makes you feel better, I'm having trouble refinancing my house to get a lower rate. Because I was responsible when I bought a house, I don't qualify for any special programs (my mortgage is <30% of my income) and getting up to 20% equity means laying out a LOT of cash. Meanwhile, people behind on their mortgage are getting 50% reductions in equity. What a country indeed.

[Red Dog]

I read that the junkyards that crush the cars are not allowed to pull engines and parts from them. That's lovely - it will depress parts supply and drive up those prices. That hurts the segment of the population who couldn't afford to trade in their beater to buy a new car even with the subsidy.

[mbs]

Originally Posted by Red Dog

I read that the junkyards that crush the cars are not allowed to pull engines and parts from them. That's lovely - it will depress parts supply and drive up those prices. That hurts the segment of the population who couldn't afford to trade in their beater to buy a new car even with the subsidy.

I thought they trashed the engines to the point of wholly unusable, however, that the rest of the car could be used for parts.

[wmansir]

They seize the engines, but the rules say the are not allowed to pull or sell ANY of the drive train. That includes engine parts (alternators, radiators, etc), trannies, CV joints, drive shafts, transaxles, transfer cases, and so on.

[GizmoDVD]

Originally Posted by mbs

You want to back that BS up with a source?

According to AutoNation (only the country's largest dealership), the average credit score on their Cash-For-Clunker deals is over 700.

http://www.cnbc.com/id/32233571

I work at a dealership - we've turned down many. That's the rate of people who likely succeeded in getting financed. Many banks won't touch people 650 or below right now.

Just because they have good credit does not mean they will actually pay their payments. Alot of these people are barley getting by and thought getting $4,500 for their running car was fantastic. Reality will smack them in the face when they get their first car payment of $250+. As soon as they hit rough times and can't pay BOOM car gets repo'ed and now they have nothing.

[kvrdave]

Originally Posted by orangecrush

I would be surprised if your 95 Odyssey isn't worth more than $4,500 right now. Those vans never seem to go down too much in value.

They depreciate more than any other Honda. We had an '02 Odyssey and when we bought an '06 it was worth about half of what we paid. Actually, that doesn't sound bad, but my '04 Element was worth about $3k less when I traded it in 2 years later on a newer one.

[wendersfan]

Originally Posted by GizmoDVD

Just because they have good credit does not mean they will actually pay their payments.

I'm going to go out on a limb and state the opinion that someone's credit score might possibly be a good predictor of whether or not they're going to pay their bills. Call me "wacky", but it's just a hunch I'm working on.

[kvrdave]

Looked up on Edmunds and trad-in value for a '95 LX with 150,000 miles (silver) is under $825

[GizmoDVD]

Originally Posted by wendersfan

I'm going to go out on a limb and state the opinion that someone's credit score might possibly be a good predictor of whether or not they're going to pay their bills. Call me "wacky", but it's just a hunch I'm working on.

It could - until they lose their jobs and have no way of paying for their new monthly payments they didn't have before. We've repo'ed many people in the 700/800's before and will continue to do so.

[mbs]

Originally Posted by GizmoDVD

It could - until they lose their jobs and have no way of paying for their new monthly payments they didn't have before. We've repo'ed many people in the 700/800's before and will continue to do so.

Indeed it's true that everyone who partakes in Cash-for-Clunker's will lose their jobs.

[mbs]

Originally Posted by GizmoDVD

Alot of these people are barley getting by and thought getting $4,500 for their running car was fantastic. Reality will smack them in the face when they get their first car payment of $250+. As soon as they hit rough times and can't pay BOOM car gets repo'ed and now they have nothing.

How can you possibly claim to know this? It's an inane as my saying everyone who traded in a clunker will win the lottery and immediately pay off the car.

[Red Dog]

Quiz for Clunkheads
by Russ Roberts on August 3, 2009

Imagine you’re a member of Congress. You’re a fan of the Cash for Clunkers program. You discover that the $1 billion that Congress budgeted for the program has been spent in FOUR DAYS. The program is now out of money. What do you do?

A. Realize that $4500 per clunker was too big a subsidy and that you can achieve the same effects with a much smaller amount.

B. Worry that maybe there is some fraud in the program and that some of the cash isn’t going to clunkers

C. Increase the budget by $2 billion

The correct answer for clunkheads is C, of course. That’s the wise choice when you are spending other people’s money. What fun that must be!

[Tommy Ceez]

So what were saying is that if GM and Chrysler just lowered the price of their cars by $4500 across the board they would be selling cars like hotcakes?

[JOE29]

Originally Posted by sracer

How empty and depressing is your life that you "can't wait" for people to lose their jobs and can't pay these car loans and then find humor in it?




Not everybody is on the verge of personal bankruptcy. Unemployment is at 10% not 90%.

Why you are assuming that everyone who is participating in cash-for-clunkers is 1 paycheck away from destitution is a mystery to me.

All you have to do is look at recent history with the housing problem to see how SOME ( not all ) people react to these programs. The housing debacle brought the whole country down and I can see parallels with this clunker program. Unemployment is at 10% in some areas of the country but I seen a report last week that it's at 17% in Detroit, and in my county it's at 11.5% according to last months released stat. I just saw a report this morning that Pennsylvania will be laying off 300-800 State workers. I wonder how many of those people just bought cars. History say's some of them did. I am sorry for saying that EVERYBODY will fail with this program, I do admit an error there. I understand there are good responsible people out there who will benefit from this program. This isn't about them, it's about the irresponsible people who can't afford to get into this program in the first place and do it anyway. And then when they default on their loans we will have to bail them out sometime in the future.

[orangecrush]

Originally Posted by kvrdave

They depreciate more than any other Honda. We had an '02 Odyssey and when we bought an '06 it was worth about half of what we paid. Actually, that doesn't sound bad, but my '04 Element was worth about $3k less when I traded it in 2 years later on a newer one.

Really? Do they just not last as long as other Hondas? We were kind of looking at used Odysseys a while back and were quite surprised at how expensive they were. A 7 year old one w/ 130K was like $10K.

[al_bundy]

Originally Posted by GizmoDVD

It could - until they lose their jobs and have no way of paying for their new monthly payments they didn't have before. We've repo'ed many people in the 700/800's before and will continue to do so.

what if they lose their job the old clunker breaks down and needs $5000 in repairs? easier to pay $250 a month than repair and old piece of junk

[mbs]

Originally Posted by JOE29

it's about the irresponsible people who can't afford to get into this program in the first place and do it anyway. And then when they default on their loans we will have to bail them out sometime in the future.

Considering the average FICO score of 700 (see above for source), I'd say the people you are worried about are not taking part in this program. So quit worrying, most people (85%+) have jobs and are paying their bills.

[kvrdave]

Originally Posted by orangecrush

Really? Do they just not last as long as other Hondas? We were kind of looking at used Odysseys a while back and were quite surprised at how expensive they were. A 7 year old one w/ 130K was like $10K.

They last just as long, but they are minivans. It's the type of car and not the brand. They hold up incredibly well compared to other brands, but it is still a minivan. Or it may be a regional thing.

[orangecrush]

Originally Posted by kvrdave

They last just as long, but they are minivans. It's the type of car and not the brand. They hold up incredibly well compared to other brands, but it is still a minivan. Or it may be a regional thing.

Maybe. Me, I love our minivan. They have so many cool features now. Automatic sliding doors, seats that fold into the ground, cup holders everywhere (oh, how I love the cup holders), etc. What is not to love?

[kvrdave]

Agreed. Leather with a 9" dvd screen, climate control, ipod controller, etc. It is amazing.

[GizmoDVD]

And here we go:

As part of the deal in the Senate, the Democratic leadership agreed to allow debate on seven amendments to the bill, six from Republicans. One, to be considered Thursday and offered by Senator Tom Harkin, Democrat of Iowa, would set income limits on who could receive the money. Under his proposal, only individuals with adjusted gross incomes of less than $50,000 or joint filers with adjusted gross incomes of less than $75,000 could take part.

Awesome. Lower class gets help. More handouts.

[wmansir]

Going by the DOT's top 10 clunker purchases you would think Americans had given up their SUV and truck buying ways.

DOT's top 10 New cars via Clunker trade in:

1. Toyota Corolla
2. Ford Focus FWD
3. Honda Civic
4. Toyota Prius
5. Toyota Camry
6. Hyundai Elantra
7. Ford Escape FWD
8. Dodge Caliber
9. Honda Fit
10. Chevrolet Cobalt

Not so fast says Edmunds. Using date it collected from dealers it finds that SUVs and trucks are still in fashion.

Edmunds top sellers via Clunker deals:
1 Ford Escape
2 Ford Focus
3 Jeep Patriot
4 Dodge Caliber
5 Ford F-150
6 Honda Civic
7 Chevrolet Silverado
8 Chevrolet Cobalt
9 Toyota Corolla
10 Ford Fusion

The difference? The DOT counts 4WD and 2WD (among other variations) as two separate models. For example, the F-150 and Silverado were divided into 5 models each. Since passenger cars normally don't have that distinction, they are overrepresented in the DOT's top 10.

This reminds me of a couple years back when Amazon.com had the Zune listed as their best selling MP3 player because their listing software counted each color of the iPod as a different model.

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