If you own a vehicle or are planning to buy one, it is important to understand the term ‘Salvage Title’ which is assigned to your, in case it has undergone a severe damage or if it is old.
A salvage title is a title given to the cars by the insurance companies, or by garages to the cars that have been damaged severely. Insurance companies term them as ‘total loss’. This title then after further verification is issued or entitled by the ‘State Motor Vehicle Agency’. After a salvage titled vehicle undergoes some more losses or damages, then it is termed as ‘Scrap’.
When is a Vehicle Given the Salvage Title
Any vehicle that bears 75% damage or more is given the salvage title, though in a few states like Florida this standard is increased to 80%. Vehicles with this title are considered to be unfit for driving. Many also call it ‘Junk’. In many states, stolen vehicles are also given the salvage title.
Disclosure of the Salvage Title
It is very important that the person who is dealing or selling the salvaged cars disclose the facts about the car. This is a legal binding in most of the states; though not all. If one fails to disclose this information, then his dealings related to the salvage titled vehicle is considered fraudulent. Many people do this; they modify their car in a way that the next buyer will not even realize the damage and would buy it. Though this is not the case always. Buying a salvaged car can be beneficial if right investigation and calculations are made.
Rebuilt Salvaged Vehicles
Salvaged cars can be rebuilt. Which means that after being properly investigated and repaired, the vehicle is fit to hit the roads again. Though the owner should consider the costs associated with it. If the remaking of the car is putting the owner at a loss, he should not repair his car and instead put it on scrap. Also to rebuilt a car, a certificate from the inspector or the investigator is required, only then can the further process take place. Keep all the bills with you safely and collect all the bills from the owner, if you are buying a salvaged vehicle, as you may need it for future purposes in case a problem arises.
Buying a Rebuilt or Salvaged Car? – Be Careful
If a vehicle is titled ‘Repairable Total Loss’ then it indicates that the vehicle can be repaired and then used for self or selling purpose. If you are planning to buy a salvaged car, then you’ve got to be really careful, while making a decision because there are many severe limitations associated with it. I shall list them down.
Limitations of Buying a Salvaged Car
- You might face difficulty in insuring your car. Also, if you manage to get an insurance, the premium could be so high that using the vehicle would not be feasible.
- You may not be able to resell it.
- The performance might seem to be okay at first but it can soon lose its performance.
- A vehicle that has previously received the salvaged title will demand more repair in future, increasing the maintenance costs.
- The safety is less. If the vehicle fails to perform during a crucial time with heavy traffic, you may end up being in a mishap.
- Often owners try to sell their salvaged cars fraudulently. They can practice ‘title chipping’, which means that the owner will register the car to a place where the laws pertaining to the salvaged cars are more relaxed or not particular, so as to derive profits out of it.
- Many owners also commit a fraudulent act called ‘Car Clipping’, which means that the ends of two different cars are welded together to maneuver the damage.
Checklist for Buying a Salvaged Car
- Though it is legally binding to disclose the vehicles history, you should obtain all the details from the VIN (Vehicle registration Number), before making a purchase.
- Get the vehicle checked from a few garage men or inspectors before buying, as the damage to the vehicles can be camouflaged to maneuver it.
- Make a frame inspection as that is the skeleton of the car. Make sure that the repairs are in place and there is no damage that has not been disclosed to you.
- Check for the air bag as well, as it tells you if an accident had occurred previously.
- Ask a mechanic for his opinion and analyze if the vehicle is suitable for a long run or no.
- Derive the salvage value of the car and then make a cost-benefit analysis.
- Be thorough with the laws pertaining to a state for the salvaged titled vehicles.
Even if you are dealing with your own salvaged car or you are planning to buy, most of the limitations and important factors that you need to consider remain the same. Make sure that you are not risking your or anyone’s life. Think about your safety, pertaining laws, opportunity cost involved and take an experts advise; it absolutely worth it.