Flash Auctions
Try out our new feature. Be fast. Save Big!

What You Need to Know About Salvaged Titles 

Date: 10/16/2015 |Category: Salvage Cars

There are many reasons for a vehicle to be declared salvaged, but this largely revolves around an insurance designation. When a car has been damaged, for whatever reason, and the cost to adequately repair that damage exceeds the value of the car, then the car will be declared as salvaged for insurance purposes.

Once this happens, the title to the salvaged car is usually only issued by the motor vehicle agency in the state it is registered to once the repairs have been completed.

What To Do If the Car You Are Interested In Has a Salvaged Title

It is important to note that salvaged vehicles can still be sold, but the title must be clearly noted as such. Now, for some people, the words “salvaged title” in the description will just cause them to go to the next car on their list. They would never consider such a purchase.

For others, however, the fact that a car has a salvaged title will just be one of many factors leading to the eventual purchase, or rejection of, a particular car. Cars with a salvaged title are not for everyone, but if you are considering the purchase of one, there are certainly some facts to keep in mind.

While a car with a salvage tag is a red flag that indicates more needs to be discovered about the vehicle, there are many deals that can be had. There are quite a few car buyers who can tell you that such cars are inexpensive options for individuals who are on a strict budget, but you do need to know what it is you are buying and getting yourself into.

What Causes a Car to Be Salvaged in the First Place?

When a car or truck has been involved in an accident where the amount of the damage ends up exceeding a predetermined percentage of the value of the vehicle, then an insurance company will determine that is not economically advantageous to fix the car. This value is typically in the 75-90 percent range, and the designation is significant from the owner’s perspective.

If a car is declared salvaged, the owner will typically receive a cash payment for the replacement value of the car in exchange for just declaring the car as salvaged. This, of course, depends on the insurance coverage an owner has, and the policies of that particular company.

After a car owner agrees with the insurance company and accepts the cash, then the car becomes the property of the company. At this time, the title of the car is given a salvage certificate, which means that it cannot be driven or operated, nor can it be sold unless it is properly repaired and has cleared inspections.

The insurance company will often then sell that car in its current condition, or in extreme circumstances to a parts dismantler that will just take off whatever it can, and recycle or destroy the rest.

It is the rest of the process that is extremely important for car buyers to note. For a title to be reissued for the car, it must be properly repaired and restored to safe driving condition. At that point, a basic safety inspection must be passed at the state’s motor vehicle department before the title will be issued.

It is at this point that car buyers might see the car sold online, with the “salvaged title” designation, or at car auctions. It is also possible at this point to get the title renamed to a “rebuilt designation,” which is important for future insurance purposes.

Is It Worth Buying a Salvage Title Car?

The answer to this question varies depending on the needs of the car buyer, the individual’s knowledge of automobiles, and the type of vehicle being purchased. It is important to remember that the company or individual selling a salvaged car might have no idea how the car was damaged in the first place.

You are basically agreeing to purchase a car that is damaged goods, but if the price is right and you know what to expect out of such a car, then a car with a salvaged title might be a worthwhile option to consider. Here are some additional guidelines that you might want to think about prior to making your final decision to purchase.

  • Get a second opinion – Do not just take the word of the individual or company that you are buying the car from. Have the vehicle inspected by a third party, such as a mechanic or friend that knows a great deal about cars, as they might see something wrong with the vehicle that you may not.
  • Make sure the person or company selling the car is reputable – Just as not all car salesmen are created the same, neither are entities that sell salvaged cars. Check them out online and learn what others are saying about their integrity. This will go a long way towards helping you develop that peace of mind you need in making a decision to purchase.
  • Request the original estimate for the repair – As mentioned, it might not always be possible to determine the extent of the damage to the vehicle that caused it to be salvaged in the first place, but the repair estimate can certainly help you. Request the original repair estimate in order to determine how extensive that damage actually was. Remember that not all salvaged vehicles were damaged in an accident. Something else might have occurred, so this is important to ascertain if possible.

When considering whether or not to purchase a car that was originally salvaged, you might want to also think about the implications for insurance. While many companies will insure a vehicle with a rebuilt title, you should be aware that the payout amounts would typically be much lower if you were to be in an accident. Also, comprehensive collision insurance might not be available to you.

Explore our Vehicle Auctions, as well as finding more information about How These Auctions Work.

Auto Auction Specialist Used car expert The largest salvage & insurance vehicle auction marketplace online.
Bid on over 200,000 vehicles for sale right now.
1-800-680-8010

Ready to get started?

Register a free user account and start bidding on your dream car right now!

Sign up for free

Unfortunately we are not in the office right now

Let us call you back during our business hours

Thank you!
We will contact you on:

{{cbTime}}am {{cbWeekday}}

{{phoneNumber}}

Ok, got it!
We speak your language:
English, Spanish, Portugeese and Russian
< Back
  • User Registration
    • Do I need to register to bid?
    • Do I have to pay to register?
    • What information do I need to provide to register?
    • What are the rules regarding new customers and customers not in good standing?
    • I do not have a dealer license; can I bid or buy a car?
    • Can I just buy one car?
  • Auction Process
    • Do you offer live bidding?
    • What is the difference between, “auction” car, and a “buy now” car?
    • What is a Reserve Price?
    • What does the bid amount include?
    • How does the auction process work?
  • Deposits and Pre-Bidding
    • Is the security deposit refundable?
    • How do international customers make a deposit in their account?
    • How does the security deposit process work?
    • Can I cancel a bid?
    • Can I inspect vehicles prior to auction?
    • Is automatic bidding or pre-bidding available?
    • What is the total bidding amount?
    • What is a bid in active status?
    • What is a bid in pending status?
    • What is the best way to win an auction?
    • How do I search for a car available at auction?
    • How does the auction process work?
  • Post-Auction and Payments
    • What does a customer need to do to get the title to a vehicle?
    • How do I pick up the car I purchased?
    • Are there storage fees if I cannot pick up my vehicle immediately?
    • Do you Issue Temporary Plates?
    • Can I pay in cash?
    • Are there late payment penalties?
    • What are the payment terms?
    • How do I pay for an auction?
    • What if I fail to may a payment as required?
    • When is the balance due on a purchase?
    • When will I be notified of the results of the auction?
    • Bidding has ended. Is my bid the highest?
    • Why did I receive notice after bidding ended that my bid is no longer the highest?
  • Shipping and Delivery
    • How will it be mailed to me?
    • When will I receive the title?
    • Can I have the title mailed to an address/name different from the address/name on my account?
    • I have an agent working on my behalf can this person pick up my vehicle?
    • Do you offer delivery?
    • When can I pick up a car I have won at auction?
  • Understanding Salvage Titles
    • What is NMVTIS and how is it used?
    • Understanding the salvage title/rebuilt title distinction
    • What are the different types of titles a vehicle may have?
    • I received a different type of title than the one in the description. I received an equivalent title from a different state. Why?