US States Rebuilt Title Rules

Can I Buy a Flooded Car and Then Fix it to Obtain a Title in Illinois?

By Mike Richards Posted: 08/16/2017

Chicago’s political corruption has been the subject of documentaries, news reports, and prosecutions for decades. It’s not just politicians in Illinois who are corrupt, though. A black and gray market car industry aims to take advantage of unsuspecting and unthoughtful buyers—and it often succeeds. That doesn’t mean you can’t get a steep discount on a great car. Flooded vehicles are a viable option, but only if you know what to buy, when to buy it, how to fix it up, and how to increase its likelihood of successfully selling.

Illinois Flood Cars: What You Need to Know

A few inches of water can destroy a car in just a few minutes. But because the water often dries quite quickly, flooded cars may appear fine—at least to the uninitiated observer. You cannot assess the condition of a flooded vehicle, or any vehicle for that matter, based solely on its cosmetic appearance. Flooded cars may have damaged engines, flooded fuel tanks, rusted undercarriage, or seats overgrown with mold or mildew.

Illinois state law recognizes these dangers, and requires sellers to notify buyers of a car’s history as a flood vehicle. So important is this goal that owners must register flooded cars under a separate title designation—flood vehicle. Once a car has been designated a flood vehicle, this designation remains with it.

Some unscrupulous sellers, of course, attempt to get around this regulation. They might drive a car to another state to register it, or refuse to comply with the law by registering the car as a flood vehicle. This is illegal, and it’s easy to get caught. Avoid title washing schemes, or you may find yourself facing severe criminal or civil penalties.

Flood and Salvage: The Same Thing?

Some flood cars in Illinois are also labeled salvage vehicles, so you might think the two are the same thing. They’re not. A salvage vehicle is one that has been damaged to such an extent that the process of repairing the car will incur expenses greater than 75% of the car’s total value. Not all flooded cars meet this criteria, and some are even still driven by their original owner.

When an insurer declares a vehicle a total loss, it will be declared a salvage vehicle, subject to additional regulations. This means that some flood vehicles are salvage vehicles, but not all flood vehicles are, and many salvage vehicles have never been flooded. This confusion over the differences between flood, salvage, and regular used vehicles makes one thing clear: you should always request a copy of the title when you purchase a car, and you absolutely must know what the title designation associated with the vehicle means.

Can You Repair a Flood Car in Illinois?

You can repair a flood car in Illinois to seek a rebuilt title. However, a rebuilt title is not the same thing as a brand new, clean title, and the buyer will be able to see that the car was once a flood vehicle. Nevertheless, a rebuilt title offers some assurances to buyers, by demonstrating that the car has been rebuilt sufficiently to be safe.

Consider rebuilding a car if, and only if:

  • You can repair it for less than the profit you stand to make on it.
  • You can repair the car such that it becomes attractive on the marketplace. Using cheap parts or leaving the car in a state of cosmetic ugliness will not earn you any buyers.
  • You do not owe money on the car. It’s almost always a bad idea to finance a flooded car.
  • You work with a mechanic whom you trust to make the car drivable.

Tips for Buying, Selling, Repairing, and Profiting From Illinois Flood Cars

Some people make a living buying, repairing, and selling flooded cars. Like anything else, this is a skill that requires practice, and you may lose money at first. Your ability to be successful depends on your ability to fix potentially profitable cars, repair them affordably, and successfully sell them. Some strategies that increase your likelihood of success include:

  • Registering for a dealer’s license. This allows you to attend dealer auctions, which tend to offer better cars at better prices.
  • Becoming involved in your local dealer community. This is a great way to receive mentoring, and to learn about big sales before the general public.
  • Learning as much about cars as you can. Knowing the car you’re planning to buy and sell is a vital ingredient to your success. You must know which cars are more likely to sell, and which repairs they’ll need to make them more attractive to buyers.
  • Buying and selling only vehicles that are in demand, such as collectible, vintage, and hard to find cars. Cheap beater cars are rarely worth repairing, unless you can do so at almost no cost.
  • Always pulling a vehicle history report so that you can understand precisely what has happened to a car. Never rely on the assurances of a seller alone!
  • Setting a clear budget for each car you purchase, and sticking to that budget—even when you get involved in a bidding war.

The market for flooded cars is a thriving one, but only if you know how to capture the attention of a buyer and make the car as attractive as possible.

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