Do you need to have good credit to participate in the "Cash for clunkers" program?
Asked by
mally03 (
310
)
August 5th, 2009
I currently have a “clunker” that I am still making payments on. Because of medical bills that have gone into collection, my credit is not that good.
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8 Answers
Not for the program. You just need good credit to get a loan on the new car. If you can pay cash you are fine.
Don’t let this great program put you further in debt. Is your clunker reliable? Is your interest rate low? With the loan be paid off in a year? How much fuel do you use in a year? If gasoline goes to $4 per gallon will the new car truly be a significant savings? How much will the new car depreciate in one year? How much will your clunker depreciate? Make a spreadsheet and figure it out.
You might be better off waiting. A year from now, when many of the clunkers are off the road, your vehicle might be worth more than it is today because it is rare. .
Try not to get further in debt.
Well, good enough to get funded on a car loan. There are subprime lenders out there that can get just about anyone financed if they have cash down (this builds trust in their eyes that you will pay for the car although your credit isn’t the best). Shop around at a few dealerships but don’t fill out a credit app unless they are a subprime dealer (ask if they use Drive Financial. If they do, they can get just about anyone a car). Cars do not appreciate unless it is an antique… doesn’t sound like what you have. So @worriedguy is incorrect about the car maybe being worth more than it is today statement. Besides that, it’s true that you shouldn’t go further into debt if you are having financial troubles. If you really need a new car, go ahead and take advantage of this Cash for Clunkers deal though.
Oh my goodness… please be careful. The idea behind this program is filled with good intentions, but as usual, the government is one giant dumb ass and will probably make things worse for a lot of people. It makes the prospect of a new car very appealing often to those who cannot afford it, getting them deeper into financial trouble. If you can’t afford a newer car to begin with, please don’t do it. There are more reasons why I oppose this program, but they aren’t relevant to this thread, so I’ll refrain. Just don’t take anything the government hands you at face value. Think for yourself if this will be good for your wallet. To answer your question, those above covered it well. Good luck.
Also, the number of vouchers available per dealership is so low, the chances of you getting one is slim. Don’t waste your money.
Thanks for the input, I think I would be better off jut pay it off for now.
@mally03 You made the right choice. A year from now you will be much better off because of it.
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