The government has announced a program on July 24. The consumers are benefited as they can do business for fuel guzzling clunkers or the new cars. With the maximum rebate value of $4,500, the borrowers can avail Car loans for bad credit and at a lower rate of interest. One can also be benefited with reduced monthly payments. One needs to check the allowances offered by the government for the bill payment.

Probably it may not help auto finance process for the customers. The consumers may not be able to benefit, if it is used as cash back inducement. It may not be helpful to the borrowers, who wish to use this amount for down payment of the car. As the borrower make higher down payment, the lenders are at lower risk. This can help them to avail car loans at a lower interest rate. The people having bad credit will be at advantage to rebate on the way to down payment.

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The policy forwards a conclusion that the people getting new car loans or used car loan on discount can avail rebate and the dealers have to get the money from government. Things would not be a problem at the dealer’s end, if money is reimbursed immediately. If case if it takes long, about a month or two, lenders may face problems for cash flow. However, the government’s website “www.cars.gov” the reimbursement period is given as around 10 days.