What is Salvage title? Buyer Tips

Should You Buy a Salvage Car?

By Mike Richards Updated: 02/25/2021 Posted: 03/04/2020

Should you buy a salvage car? What is a salvage car? What auctions can you buy them from, and do you need a dealer license to buy a salvage car? Let’s explore what these vehicles are, and how you can access sales of salvage vehicles.

What is a Salvage Car?

Most individuals, when they hear the term “salvage”, assume that the vehicle in question is either destroyed, no longer works, or was completely wrecked in an accident. But that is not always the case. You can actually get an incredible deal by purchasing a salvage title car.

A vehicle gets a salvage title in some specific circumstances. One possible situation is when a vehicle needs repairs worth more than a certain percentage of its estimated value (for example, 75%). In such a situation, the insurance company considers that repairing the vehicle is not worth the expense, and so decide to cut the owner a check instead. The reason for this may be damage incurred in an accident, or due to hail, wind or fire.

There are extraordinary circumstances where a vehicle may have been stolen and then later recovered. In such cases, the car may have been given a salvage title as well.

What Issues Are Associated With Buying Salvage Cars?

Before getting into all the positive aspects of investing in salvage title cars, you need to be aware of all the potential issues you may have to deal with when working with salvage title vehicles.

salvage cars auction

They Are More Difficult to Insure

When dealing with a salvage title car, one of the most important issues you will come across is finding out whether you can get insurance for it. It’s by no means impossible to do it, but you need to be aware that it getting insurance coverage for a salvage car is harder than for a clean title vehicle. Insurance companies are reluctant to insure salvage cars because it is difficult to calculate the risk in a vehicle that may have been previously wrecked or badly damaged. However, as we will show below, there are ways of getting even your rebuilt salvage vehicle insured.

Repairing and Maintaining Salvage Cars

Some salvage cars may require a lot of repair work. This is when potential issues may emerge. You cannot be sure that you will be able to fix everything quickly and easily. Salvage title vehicles may include vehicles that suffered major accidents and have structural damage. Some structural damage is not even noticeable until after making certain repairs.

Some issues in crashed cars may simply never go away. Even after many visits to a repair shop, the car may still continue to have issues ranging from alignment to electrical problems. If you are looking to buy and resell, this may not be so much of an issue to you, but if you are looking for a long-term drive, this may be a headache you would want to avoid.

There is No Guarantee You Will Get Your Money’s Worth

You can make all the right moves, buy all the right parts at very cheap prices, even be a very good mechanic yourself, but you can never be sure that you will get what you want. Dealing with broken items is always a challenge, so before you decide to buy a salvage car, you need to be aware that this is never without risk.

inspecting salvage car

Why You Would Want to Buy a Salvage Car

When looking for salvage cars, you will find vehicles in a variety of conditions. Some will have significant damage. Some can be repaired easily, while others may need more work depending on the type of damage that needs to be repaired. You need to look at the reason behind your decision to buy salvage cars. Is it for scrap? Do you want to fix it and resell for a profit? Or are you buying the car for your personal use? If you enjoy rebuilding salvage cars, you probably want a car that will challenge your restoration abilities.

If you are looking to buy, repair, and sell for a profit, salvage cars can be a good investment, if you know your way around these vehicles. This may be a steeping learning curve, but over time you can become an expert and make some significant profits from fixing and reselling, especially if you are already a good mechanic.

Further Reading

If you are looking for a car for personal use, you may be able to get a great deal. You may come across vehicles that were stolen but were recovered too late, thus resulting in the salvage title. You may also come across vehicles that need a lot of exterior work done, but have a great internal structure and electrical systems that work like new. These are cars in pretty good condition, and in need of only minor repairs, that are nonetheless sold at very low prices due to their salvage title.

Salvage cars can be rebuilt and made roadworthy again. If you know how to repair vehicles, and you can really save a lot of money. For those that really know their way around a car, salvage cars may be a great way to start on long-term projects to repair a vehicle that you always wanted (sports car, antique vehicle, luxury brand vehicle, exotic cars, etc..) while saving a whole lot of money after all the work is done.

Wholesale Auction

Where Do You Find Salvage Vehicles?

You can find salvage title cars at dealer-only auctions. These auctions are usually only open to holders of a dealer license. These licenses are usually not worth obtaining if you’re just a private buyer looking to buy salvage title vehicles once in a while.

What are Dealer Auctions?

Dealer auctions are auctions geared towards salesmen. As these auctions are where dealers get their stock, the prices on the vehicles are at a much lower than those found on the dealership lots. That is what makes these auctions so advantageous.

Dealer licenses are only obtainable by undergoing a long and complex process that can vary from state to state. Now, unless your life-long dream is to become an owner of a car dealership, it would not be in your interest to take such a long route just to participate in these auctions.

But you don’t need to become disappointed, because there is another way to get into dealer auctions without having to take that long and arduous route. You can use a proxy bidder.

How Do Online Dealer Auctions Work?

Proxy bidders work by being the intermediary between the seller at an auction and the interested buyer. A proxy bidder like Auto Auction Mall already holds a dealer license, which gives them the legal right to participate and purchase a vehicle at the dealer auction. What they do, then, is give you access to the auction inventory, letting you select the vehicle or vehicles you are interested in. They will then bid on your behalf, up to the maximum bid you have set.

Why Auto Auction Mall is a Good Choice

We’ll let our video do some of the talking here:

Auction Auto Mall has one of the largest databases filled with used, like-new, pre-owned, and salvage cars. You can search for any type of car, make, model you want using the available search functions located on the website.

Many consumers rate AAM higher than other sites because of the extensive database of used cars available. They provide the best quality customer servicer and their representatives are available to help you at any time. The representatives at Auto Auction Mall will walk you through the process, help you to bid, and make sure you acquire the vehicle you want without any hassles or headaches.

Another benefit of AAM is that they have financial advisors ready to work with you and help you finance the vehicle you choose. Offers made include low down payments, low interest rates, and some of the best deals available on an online auto auction site to date.

Tips for Buying Salvage Cars

Consult a Mechanic

It is difficult to be sure of the amount of work needed to repair a salvage vehicle, especially without being able to see it physically before buying. However, having expert advice from a mechanic who is familiar with the type of salvage vehicle you are looking into can be of great help. Getting advice from individuals who are already very well acquainted with salvage titles is always a good way to start even for a person who already knows how to repair vehicles very well.

Even with all the research in the world, there may be some important details we can overlook. The advice of an experienced mechanic can help you avoid possible costly mistakes and risks.

Know the Market

Before going to an auction, it is important to do your background research. Many times, a seemingly attractive deal is not as good as you might think. For example, you may find a Porsche at a much lower-than-market-value ticket price at an auction. This would seem like a good deal as Porsches are luxury cars that usually go for high prices. But you need to be aware not only of the market value of the vehicle, but also of its condition and potential repair costs. Repairing and maintaining a luxury vehicle can be very costly, and replacement parts can be very expensive. That’s why it’s very important that you do your research before bidding.

Become Familiar with Insurance Companies

When trying to insure a repaired salvage car, it is preferable to first discuss with large companies that can afford the risk or a company you have been getting coverage from. It’s sometimes easier to convince an insurer to cover your salvage title car if you already have other policies with them.

The condition of the vehicle prior to purchase is an important factor. If the vehicle did not need repairs prior to being purchased at auction, then the chances of getting insurance are higher than if the car needed repairs, especially if the damage was structural.

Keep in mind that repairs and purchased parts will need to be documented and documented and photographed and that you will need to keep receipts after each repair. This is necessary to register the car and to facilitate getting insurance coverage for your vehicle.

Know Where to Get Parts for the Vehicle

Often, junk yards and individuals looking to sell old broken down vehicles and/or their parts are the first sources people think of when looking for spare or replacement parts for a fixer-upper. But what if you need a large set of parts for a car that needs a complete repair job? When looking for a full set of parts to repair a car, you can make big savings by buying another broken down vehicle with intact parts worth using. The best place to find a car like that and car parts is an auto auction.

A salvage auction is a great place to get quality, original parts at a low price. Sometimes it is difficult to find parts for older models no longer in production. However, as many cars end up at a salvage auction, you are likely to find a car that is the same model as yours. This gives you the opportunity to acquire parts for cheaper prices and even buy in bulk, by buying the whole vehicle, to use in various vehicles that you buy, fix, and resell for a profit.

When it comes to buying salvage cars, you need to carefully consider what you are looking for and how much you intend to spend. Of course, for those looking to restore an old classic vehicle, prices will be higher than for someone looking to repair a common everyday car. Regardless of what you intend to do when buying a salvage vehicle, there are many opportunities out there. With research, patience and some skill, you may even find something better than you expected for a great price.

Example Live Auctions