Free cars and and at least three legal ways to get one

My folks, who don't drive as much as they used to, recently decided to give my son the keys to a 21-year-old farm pickup truck they once used to take him on camping trips when he was little.

He's really happy about that. Besides the memories that are involved, the pickup will handle northeast Kansas winter driving challenges better than his Miata. And my parents and I are happy for him because free is a tough price to beat, especially when used car prices are rising.

Auto industry trade publications report that last month's Cash for Clunkers program cut the heart out of the normal seasonal flow of used cars to dealers' lots. That puts more pressure on dealers to sell new cars. It also hurts their profits because, counterintuitive as it might seem, dealers make bigger profits selling used cars than new ones.

But none of that answers another question; why pay anything if you don't have to? There are at least three ways to get a car for free without risking jail time.

You can accept one as a gift from a relative, friend or even an impulsive celebrity. That's hard to plan on, of course. You can go to work for someone who gives you a company car to use. Good luck trying that in today's job market, even if the recession is supposed to be ending.

Or you can go into advertising. There are companies that will either give you a free car emblazoned with their clients' ad messages or pay you to have yours decked out with the ad message and then drive your mobile billboard around town. Read the fine print before you sign anything though. The deals vary widely.

Financial self-help guru Dave Ramsey's organization insists there is another way to get a free car too. Buy the best used car that you can afford for cash. Stash the payments you otherwise would be making into a savings account. Use that cash and your trade-in to trade up in a couple of years. Repeat as needed. This isn't truly free, of course, but it is very thrifty.

Finally, before you do anything, do the math. As Edmunds.com senior editor Karl Brauer points out, keeping even a relative gas guzzler can be thriftier than borrowing to buy a fuel sipper.

Cashless clunker buyers prepare to fight back

Uncle Sam's cash for clunkers program officially kicks in later this week, but you can test drive some deals now. Two different things are happening that make comparison shopping a lot more interesting than it was just a few weeks ago.

First, those remarkably nimble marketers at Hyundai are already offering clunker cash along with $1.49 a gallon gas and other incentives. The South Korean auto giant has been fronting dealers money for almost a month to spur market share. It's working, The New York Times and trade press report. Other automakers are waiting to make sure how they'll get money back from the program. Meantime, Chrysler said it is doubling the government offer on some of its cars.

Second, Detroit, which still is surfing a tsumami of foreign competitors on various best buy lists, appears to have some additional new competition. AutoRemarketer.com, among others, reports that bankruptcy-jilted Chrysler and -General Motors dealers now selling used cars as independents, will be working to snap up their share of pent-up consumer demand.

So for consumers, we're back to square one in the buy-new-or-used-debate. Do we go with new car perks and incentives or money saving, depreciation adjusted, used car values? The rules haven't changed. The numbers might. Gentlemen, start your calculators.

Cars that no one wants are worth buying

OK, maybe not Hummers so much. Gas prices are still dodgy. And I don't get warm and fuzzy about anything that reminds me of riding in Army trucks.

But analysts at Consumer Reports and elsewhere are arguing that the auto brands that General Motors and Chrysler are tossing into their financial scrap yards are good deals for anyone who wants to buy a new car and keep it.

We've been through this before, as Bankrate Monitor's five years ago elegy for Oldsmobile buyers reminds us. Someone will be around to provide parts and service, though some warranty work might require driving farther.

The killer for many car buyers is resale value. It drops like stone when dealers start ripping auto names off their walls, report services such as Edmunds.com or Kelley Blue Book.

You can make that work for you, say observers such as Sylvia Cochran at Associated Content. Buy cheap now because dealers are really motivated to move discontinued models. Realize you won't get squat for a trade-in. Drive it until the wheels come off.

The analysts don't say so, but I can see one big challenge to preplanning a future clunker. That's selling the idea of a fuel-sipping Saturn to a 16-year-old new driver in your house. Guaranteed eye-rolling, no matter how you pitch it.

Cash for clunkers - you can't just go in and kick the tires

Unloading that beat-up late '90s Ford Explorer or other gas guzzler in the government's new Cash for Clunkers program may be a lot easier if you have a calculator, Internet access and a flexible schedule.

Basic rules are already posted on the program's official www.cars.gov Web site. But some auto industry analysts say waiting until about July 23 might get you the best deal. That's the the National Highway Traffic Administration's deadline for coming up with detailed rules spelling out how auto dealers get paid for fronting us $3,500 to $4,500 and making sure our clunkers actually make it to the scrap yard and not some underground resale market. Some dealers may be more cautious until they know those details

But you may not want to wait too long either. The program is scheduled to end Nov. 1 or sooner if buyers hit a 250,000 sales limit set by federal spending caps.

Meantime, Detroit, its competitors and camp followers are revving up some sales pitches now. General Motors, Ford, Toyota, Nissan and Hyundai already have added Cash for Clunkers sections to their Web sites. Other auto makers and related outfits such as finance companies seem likely to follow.

Financing the new fuel-sipper you buy with your clunker cash gets interesting too.

Lenders to auto buyers are just as antsy about loan quality as home lenders. According to some indicators, it takes maybe a 720 to 760 point credit score now to get the same comfortable interest rates that a 600 to 700 point score fetched six months ago.

700 points is going to be stretch for a bunch of us with foreshortened income prospects. Outfits such as MoneyNowUSA.com, which collects loan applications online and coordinates them with payday and other lenders, offer to seek loans for borrowers with scores ranging as low as the upper 400 to low 500 range. Rates depend on the lender who agrees to actually make the loan, but won't be cheap. Or you may need a co-signer.

When car dealers close, what's in it for me?

Yep, that is a self-serving question. But there is a lot about the Chrysler and GM dealer closings that I don't understand. And while I feel for guys I know at area dealerships, I gotta wonder exactly how this might bite the rest of us too.

First, what happens to the cars?

The last industry figures I saw showed that GM, Chrysler and other dealers had maybe 111 to 114 days of unsold inventory in the pipeline. You can't sell all those just by slapping a "Bud's Auto Sales" banner over the old corporate logo. My guess is that GM and Chrysler buy a lot of them back, using our taxpayer dollars. Maybe to reduce national budget deficits, the government can gin up a version of the old payment-in-kind farm programs and mail us Chevies instead of tax refunds next spring.

Also, how hard might dealers fight being pushed out of business?

They have options other than curling up in a fetal position. Theoretically, state franchise laws protect dealers from forced closings; that's one of the things GM and Chrysler have been struggling with in the back-and-forth so far. Plus dealers should have political allies. Auto dealers generate about 18 percent of retail sales taxes collected in the U.S. and many states. Some already are enroute to Washington to remind lawmakers.

And finally, how will the changing cost structure affect us at the tire-kicking level?

You may see some pretty amazing deals during the transition. But National Automobile Dealers Assocation chairman John McEleney, already warns of maybe driving 50 miles for oil changes and other warranty work. I don't see that exactly. When Kansas City's Saturn dealers dropped that franchise recently, virtually everyone with a wrench flooded our mail boxes and e-mails with invitations to come see them.

Come to think of it, some of them maybe talked to Congress too. Or at least robo-called them.