If the car is repaired, most states require that it pass a basic safety inspection before the motor vehicle agency will issue a new title.
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When the state does issue the title, it's "branded," so future owners are aware that the car has been salvaged or rebuilt. Check your state's laws on salvage title vehicles for more information.
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A car with a salvage title hasn't always been in a collision, however. There are a number of reasons why a vehicle might get a salvage title, said Mark Binder, national salvage manager for Farmers Insurance. Flood damage: Flood-damaged cars sometimes get a salvage title. Some states will specifically call out flood damage on a car's title, but other states merely use the term "salvage title.
Hail damage: As with flood cars, the titles of vehicles that are damaged by hail can also get a salvage title if the state does not have a specific "hail damage" designation on the document.
Theft recovery: After a vehicle has been stolen and is missing for a certain period of time, the insurance company will pay off the vehicle. If the vehicle is eventually found, the insurance company is free to sell it to a salvager, which will replace any missing parts.
Some states will then issue a salvage title for the car. Vandalism: If someone spray-painted or overturned a vehicle and caused enough damage, the car could get a salvage title.
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No states, however, specify vandalism in the title — just "salvage. Non-Repairable: A severely damaged and non-operable vehicle with no resale value other than its parts can get a "non-repairable" designation, which some states call a "junk title. It depends on how comfortable you are with buying a car that has a checkered past.
On the one hand, salvage-title vehicles can be an opportunity if you're on a budget or in need of a second vehicle. Depending on the vehicle, a salvage-title car can sell anywhere from about 20 percent to 40 percent less than the same vehicle that has a clean title, said Richard Arca, pricing manager for Edmunds. He added that the markdown of a salvage-title vehicle is greater when the market demand for the vehicle is low. On the other hand, some salvage-title vehicles can be more prone to mechanical problems and have reduced resale value.
Consumers can do these three things to help minimize the risks of buying a car that will let you down, Binder said:. Have the vehicle inspected: This is one of the most important things to do if you're considering the purchase of a car with a salvage title. Bring a mechanic with you for an inspection.
You might also arrange to take the car to a body shop. A car professional will have a better idea about whether the repairs were done correctly and can spot any red flags, such as frame damage or parts that still need repairing.
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There are a lot of things to consider when you're in the market for a salvaged car, not just the damage the car has suffered.