What Does Salvage Title Mean

What does salvage title mean, and how does it effects on car's price? A salvage title car indicates that the intended vehicle is damaged, and the insurance company considers it a total loss. Keep reading if you have eyes on a salvage title and want to know its effect on the value. Also check out our other blog post on clean title cars and in case you want to buy a top-notch used car, see our latest inventory.

What Does Salvage Title Mean

What does Salvage Title Mean?

Assume the intended vehicle had a significant accident and the cost of repairing it is more than its worth. In this scenario, the insurance company declares a total loss and takes repossession of the car.

Looking to recoup its charges, the insurance company often resells it to an auto repair shop or company where they can repair the vehicle or even rebuild it. The next title on the fixed or rebuilt vehicle is referred to as a salvage title. This title lets future potential buyers know the car had a significant accident and has been repaired.

Law and rules on salvage titles vary from country to country and state to state. It's always advisable to check the facts in your state or country on a salvage title car before you purchase it.

While classes vary on a state-to-state basis, a salvage title may show a car is damaged in the following ways:

· It has collision damage from an accident;

· It has experienced fire damage;

· It has experienced flooding damage;

· It has been stolen, and parts may be missing;

· It was formerly a heavily-used taxi or law enforcement vehicle.

Is It Logical to Buy a Salvage Title Car?

If you're an expert in working on and repairing vehicles, buying a salvage title can save you a lot of money. But keep in mind that salvage cars come with significant risks, including:

Problem with Financing

Banks and other lenders are reluctant to finance salvage titles cars because salvage vehicles don't have a Blue Book value.

Their Unknown History

Auto lenders hold back on financing because they're unsure of the car's accident and repair history or don't know how stable the vehicle is on the road.

Low Trade-in Value

Owners of salvage title cars may face problems trading the vehicle when they buy a new car. Usually, auto dealers won't accept cars with a salvage title as trade-ins due to the higher risks of selling them to another buyer.

Low Insurance Value

If you buy a car with a salvage title and it was in an accident, the insurer likely won't be paying out so much money to cover the damage, given the salvage title car's low value in the first place.

High Interests and Short-Loan Terms

If a lender decides to finance a salvage title vehicle, the borrower can expect higher interest rates and shorter loan-repayment timetables. Auto lenders look to protect themselves from problems linked to salvage title cars due to the high-risk collateral of a salvage title.

What are the Important Factors in Buying a Salvage Title?

It's advisable to do significant due attention to a new vehicle purchase to recognize it as a salvage title car.

In some instances, suspicious vehicle sellers may steer the vehicle to another state, with relatively lax regulations on salvage car titles.

This method, known as title washing, hides the damage on a car for sale and winds up costing the buyer more to buy the vehicle and lead to unexpected repair costs.

Vehicle history tracking products such as AutoCheck Vehicle History Report handle due diligence for car buyers as low as about $25 per report.

If you're at the serious stage of buying a car, take the vehicle to an assigned auto mechanic before signing on the line.

An experienced mechanic knows where to look for possible auto damage. He knows where repairs have already been made and recognizes any new or used parts that have been installed. They could signal that a vehicle has experienced severe damage, and cheaper parts have replaced original ones.

Track the vehicle's history via the VIN, which provides valuable data on a vehicle's history, like how many owners the car had, title and accident history, and odometer readings when the car changed owners.

You can check a VIN at the NCIB (National Insurance Crime Bureau) and its VINCheck service.

Check the Original Repairs

Ask the insurance company for the original repair estimate of works on the vehicle. That will give you a framework for how much damage the salvage title car has received and help you negotiate a better price.

Research Alternative Auto Financing Options

Sometimes it's not easy to get a good auto financing deal for a salvage title car. That's why you have to focus on having a solid cash reserve to decrease the need for financing.

It would help if you also researched alternative options, like a personal loan or a home equity credit, to finance at a higher interest rate and a potentially more extended repayment period.

Investigate State Lemon Law Purchase Options

Some refurbished cars get different samp of approval called Lemon Law used car sale. In this case, repaired vehicles are purchased by auto producers and resold in dealer lots. Most states have laws that provide a legal remedy for buying a car with insurmountable repair problems.

What are the Signs of a Salvage Title Car?

While you should always check the vehicle report and have asked an auto mechanic to check the vehicles for problems, there are some signs that a car is a rebuilt lemon, and it's better to avoid it.

Look for these signs in the salvage title car:

· Many states require identification of the vehicle that's been in a salvage situation on the title. It would help if you asked to see the title before anything else.

· The vehicle paint quickly takes off or doesn't match the rest of the car. It can show an intent to hide damage by the seller.

· CAPA (Certified Automotive Parts Association) sticker on any vehicle part or component can show collision repair.

· Any wheel misalignment may refer to frame collision damages.

· A car door that doesn't open properly could also mean the vehicle underwent significant repairs and was improperly repaired.

· If the hood is misaligned and doesn't close perfectly, that could indicate a significant collision impacting the front and sides of the car.

· If your electrical components don't work correctly, especially if they flick on and off intermittently, that is a sign of significant flood damage to the vehicle.

What do Lemon Laws Mean?

In most states and countries, a dealer must repair any problems with the vehicle over a period or provide for complete reimbursement for the costs of such repairs at no cost to the buyer.

Suppose an auto dealer cannot repair the vehicle after a reasonable amount of time, depending on a state's lemon law statutes. In that case, the buyer should complete a refund of the damaged car's purchase price.

Your state department of motor vehicles has information on state laws, including explaining salvage titles and identifying them correctly. Here's a state-by-state list of US motor vehicle departments.

What If I Unknowingly Buy a Salvage Title Car?

If you unknowingly purchased a salvage title and want to back it out of the deal, you do have legal support.

Take these steps to repair a salvaged title car without previous knowledge:

Contact State's Consumer Protection Office

Your home's consumer protection office can offer some valuable guidance on purchasing a salvage title car and get you on the route to a refund.

Get Legal Help

If you live in the US, Contact the National Association of Consumer Advocates for a list of trustworthy lawyers in your area who handle salvage title car issues.

Start a Paper Trail

Leverage your buyer's guide to make the case that they sold you salvage title car fraudulently. The US Federal Trade Commission mandates that used car dealers offer new car customers a buyer's guide on every vehicle, which covers a car's warranty data in the event of a dispute between a seller and buyer.


What does salvage title mean in the used cars market? This article is all about salvaged vehicles. Read it carefully, and if there is any more question, contact our experts for more information in the field.

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