I wanted to get this short and concise blog out before the weekend to inform the car acquiring universe before making a major purchase decision. Effective as soon as the New Economic Stimulus Plan is passed will be a new ammendment authored by Senator Barbara Milkulski of Maryland known as the
Auto Assistance Ownership Amendment
It will make interest payments on car loans and state sales or excise car tax-deductible for new cars purchased between November 12, 2008 and December 31, 2009. There are two caveats: The vehicle must cost less than $49,500 and the car buyer must earn less than $250,000.
You have to love her quote from the floor of the senate:
“Mr. President, our economy is in shambles. People are losing their jobs, their life savings, and their homes. There is much work to do and no time to waste. We’ve already done a bailout. We’ve helped the sharks and we’ve helped the whales. Now it’s time to help the minnows."
So what does this mean to the "Joe Blow Minnows"?
My first thought is it fails to take into account the 30-40% of Americans who lease their vehicles? Where is the incentive to buy a Used Car? Why not come up with a "recent year limit" to allow more people to buy a "Newer Used Car" and take advantage of the same deduction allowances? How do you ignore the leasing market entirely?
Regardless our opinion on the amendment, the take home message is "finance a New car under 50k in 2009"!
I'd love to hear your thoughts?