What is Salvage title? US States Rebuilt Title Rules

Salvage Title vs Rebuilt Title: What is the Difference?

By Daisy Emah-Emah Posted: 07/05/2021

Salvage title cars can be very attractive to buyers because they’re guaranteed to save you a couple of thousand bucks. Or more thanks to the below-market level pricing and guarantee of the low final purchase price at the auctions but…. are they OK to buy?

If you are working on a tight budget trying to get that dream car, thinking of saving a few bucks, by buying salvage titles or rebuilt titles vehicles would at some point have crept into your mind. 

 

The dilemma now is if you should avoid vehicles with salvage or rebuilt titles, considering the risks of unseen damages versus cost. Or stick to clean title vehicles only or take a risk and end up getting the deal of the year.  The risk is compounded if you are buying for export and the added costs of shipping a non-runner vehicle. 

 

The truth is buying a clean title provides no assurances either considering the sale condition of “where is, as is.” A clean title has more competition amongst buyers at the auction and will take a huge chunk off your pocket. 

 

salvage car

 

Furthermore, a damaged vehicle being sold off right after the damage occurred and the title has not been renewed may likely still have a clean title tag to it giving you false expectations.

 

So if the risk exists for both clean and salvages title cars, wouldn’t the smartest thing to do be to go for the option that feels right to you, is of low risk to you personally, and would likely save you money?

For many, the answer to this is simple, Salvage or rebuilt title cars.

 

Salvage or Rebuilt Title

Before buying a salvage or rebuilt title vehicle, it is important to understand all aspects and what they mean. When major damage occurs such as an accident, the status of the title “salvage” is used – before repairs; while “rebuilt” is the status of the title after repairs have been done on a vehicle earlier tagged salvaged.

 

The repairs have been inspected and verified, usually by the state DMV of where the vehicle is located/. 

 

Before we delve further into the differences between salvage and rebuilt titles, it is important to note that the definitions may slightly vary from different states in the US. 

 

Salvage Title

A salvage title is issued to a vehicle that has major damage such as an accident. This means that the vehicle is deemed not roadworthy and safe to drive. Insurance companies access the vehicle and make the call on what happens next – depending on the state. Depending on the percentage (between 75 and 90) of the damage, the vehicle may be declared a total loss.  

 

In some states, if a vehicle is stolen and can’t be recovered in 21 days or more, it is declared a total loss and branded salvage status. Even if the vehicle is recovered undamaged, it still retains the salvage title status.  

 

Salvage vehicles are relatively cheaper than vehicles with clear title, thanks to the damage which occurred. So you will be saving a few bucks on your purchase of salvage vehicles. You might even get lucky and find a salvage titled vehicle with minimal or cosmetic damage… surprisingly this is often the case 

Title salvage

You can also purchase a salvage vehicle with major damage which can be disassembled and used as auto parts to fix other vehicles. You can use parts for yourself or make a lot of money selling parts especially if they are hard to find parts for uncommon vehicles/

 

Nonetheless, there is a chance there may be recurring or hidden issues. The cost of fixing the vehicle may be minimal if cosmetic or expensive if the damage is major. There is every likelihood that the cost of fixing salvage vehicles may exceed the buying price especially in cases like engine or transmission damage. 

 

Sometimes the vehicles may never be roadworthy again   

 

Rebuilt Title

A rebuilt title is issued to a salvage titled vehicle after it has been repaired or rebuilt. In some states, after passing a state salvage inspection a vehicle with salvage title becomes rebuilt salvage. Even after extensive repairs, a salvage vehicle cannot be issued a clean title to prevent you from paying more than the vehicle’s resale value. 

 

A vehicle with a rebuilt title has already gone through the major repair stage, you don’t have to spend so much on major repairs, unlike a salvage title vehicle. You can avoid the damage guessing game because the vehicle has been certified. 

 

Also, a vehicle with a rebuilt title is way cheaper than that of a clean title. So if you are hoping to shove a few more dollars into your piggy bank – this is a good bet.

 

US STATES Title rebuilt rules

 

Always remember that even if a vehicle has been rebuilt by professionals, there may be hidden issues and the vehicle may require more repairs in the future. These hidden issues cost money to be fixed. 

 

Also, you may be unable to attest to the extent of damage that occurred to the vehicle. Damage like a flood may leave the vehicle vulnerable to premature corrosion.  You can neither attest to the quality of parts used in the repairs nor if the work was done professionally. It is always a gamble with rebuilt title vehicles. 

 

Financing and insurance companies flinch from rebuilt and salvage vehicles because of their reduced value. Car insurance for rebuilt and salvage title vehicles is usually difficult to secure and partial coverage may be costly. 

 

Whether it is a salvage or rebuilt title vehicle you are sure to save a few thousand as opposed to a clean title vehicle. 

 

To get the most out of your salvage title vehicle, make sure all repairs are done by a licensed professional. Before a salvage vehicle can be licensed and insured, an inspection must be carried out. This includes structural integrity inspection,  by a licensed technician 

 

Further Reading

  1. 5 Sites you Need to Check Before Buying a Used Car 
  2. How to Choose the Right Used Hyundai for Sale
  3. Everything You Need to Know about Buying Used Cars
  4. How to Get the Best Vehicle History Report on Auction Cars for Sale 

 

So Salvage Title Or Rebuilt Title or Clean Title?

At the end of the day, this is the question it all comes down to. There are options available to balance the level of risk and still get the deals that come with it. 

 

One option is to request/purchase Vehicle History Report (VIN check) for less than $20. This will give you a history of damages and maintenance of the vehicle.  It gives you more information to help you weigh the risks when making a decision. 

Vehicle History Report

Another option is to purchase/book/arrange a vehicle inspection for between $150 – $200 per vehicle. What you get is a 30point checklist of the vehicle’s condition assessed physically. This is the best option to be safe and entirely sure. This provides a more accurate review of the extent of damage and the current physical condition of your chosen vehicle. 

 

It is important to note that VIN checks may be prone to omission as the report is only as good as the records available on the vehicle and how recently it was updated. A physical vehicle inspection by a professional has a lesser omission rate and chances of higher accuracy though at a higher cost. 

 

On request, we can assist you to procure a VIN check or physical vehicle inspection. All you need to do is sign up on the Auto Auction Mall website for free and get buying power to get started.  

 

Oh! Did we mention that you also get full access to an inventory of over 200k vehicles to choose from? You don’t need a dealer’s license either!

 

Sign up now!  

 

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