July 29, 2009 -- This is the first week of the government's "Cash for Clunkers" program, and the Department of Transportation, reports that $35 million of the $1 billion budgeted for the program has already been spent.
When the funding runs, out the program ends, but until that day,thousands of Americans are taking advantage of it -- 8,000 deals have already been made.
Hanan Shemtov of Silver Spring, Md., made one of those deals Tuesday night. He traded in a 1991 Chevrolet G20 van worth only about $400 and got $4,500 in return through the government program.
"It's actually the only reason I'm doing that," Shemtov said. "Otherwise I wouldn't have bought a new car."
Here's how the program works:
If you own a car made in 1984 or later that gets 18 miles to the gallon or less, you can qualify.
It must have been registered and insured over the past year, and it must start.
If you trade it for a car that gets four more miles per gallon, the government gives you $3,500.
If your new car gets 10 miles more per gallon, you get $4,500.
If you're trading an SUV, minivan or small pickup, you only have to improve your mileage by 2 to 5 miles per gallon.
The vehicle you buy must be brand new and cost less than $45,000.
Auto dealership owner Scott Addison said he's seen "lots and lots of interest."
"We've got people coming out of the woodwork. I haven't seen this many clunkers in my life," Addison said.
When 'Cash for Clunkers' Isn't the Way to Go
The program is not a good deal if your used vehicle is worth more than the government credit, because the credit is in place of your trade in value.
One other disappointment: in recent days: The government changed the fuel-economy ratings for about 100 cars, so some people who thought they had qualifying vehicles now don't.
"I would tell consumers, look again, make sure you don't go to the dealership and get a nasty surprise," said Jessica Caldwell, an analyst at Edmunds.com.
The government is hoping buyers will visit one of the 16,000 participating dealerships and help repair the auto industry.
Click on these links to see how you can take advantage of the "Cash for Clunkers" program.