Best Car Deals: August 2009

Cash for Clunkers is finally here - that's easily the biggest news for car shoppers this month.
Despite a flurry of media reports to the contrary, the government says the program has not been suspended, and deals struck this weekend will be honored.
The program may affect your ability to get a great deal on a great car in August...but it may not. It's critical that you understand the program's requirements and know whether the program will really work to your advantage before you hit the dealership. The fine print could make all the difference.
Read our Cash for Clunkers page to understand how to qualify.
Car dealers have been running some enticing ads promising a lot on Uncle Sam's dime in August. Chrysler, for instance, will match the government's incentive on many new cars with its "Double Ca$h For Your Old Car" promotion. Mazda will add $500 to any government incentive, on top of existing cash-back rebates. Even BMW is matching the government's offer on some models.
But August is a month for reading the fine print. You can, for instance, use your Cash for Clunkers trade-in as a down payment and take delivery of a new Smart Fortwo for just $99 a month for three years, but there will be a $6,667 balloon payment due at the end of those three years - a payment no one in Washington has plans to help you make.
Promotion or not, the fundamentals of car shopping still apply this month. Take good care of your credit rating, negotiate respectfully with a dealer who is trying to survive a troubled market, and apply any cash-back rebates to the down payment to knock down what you owe before you even drive away. If you keep those principles in mind, you'll be able to negotiate a good deal with or without Congressional help.
Below, we survey the market and highlight the best deals on the best cars in August. This month's list includes a lot of well-built domestic cars that have seen their sales figures tumble as the companies that build them struggle in a recessed market. But June sales figures showed signs of a rebound led by American automakers. Those sitting on the fence should note that stronger June sales figures may mean that automakers will be less motivated to offer great deals soon.
And, of course, if you have a clunker that qualifies, you should plan to use it. The government has promised to honor cash for clunkers deals inked through Sunday, August2, but an extension beyond that date is still under debate.
For details on how to qualify for the government's program, see our Cash for Clunkers FAQ. Stay on top of the latest updates on the program with our Cash for Clunkers News page. For all the latest Cash for Clunkers incentives in one place, check out our Cash for Clunkers Deals page.
If you're looking for a car that's a great deal over the long haul, check out the 2009 U.S. News Best Cars for the Money Award winners.