Next time you buy a used car, maybe you should consider one with a salvage title.
I know that goes against all rational advice and conventional wisdom for used-car buying, but there are certain conditions where a salvaged car might actually make sense. First, though, it’s important to understand exactly what a salvage (or junk) title really means.
Generally, though it varies greatly by state, a salvage title is issued to a damaged car when the insurer determines the cost of repair exceeds about 75 percent of its market value at the time of the accident. Repaired cars are often sold with the “salvaged” or “rebuilt” brand on the title at substantial discounts over similar cars with clean titles.
Considering how many ways a car can get destroyed, there are certainly risks in buying once-wrecked vehicles. However, you could also score the deal of a lifetime.
First, there are two rules I simply won’t bend regarding salvaged cars: Never buy a vehicle damaged by water or a vehicle with a bent frame. Between the devastating effects of water on electrical parts and the permanent risk of mold growth, water-damaged cars must always be avoided. Frame damage never really goes away either. Once the metal is bent, its integrity is compromised, and that could turn into a serious safety issue.
That said, I would consider cars repaired after:
- Heat damage. I owned a 2004 Honda Pilot that, in 2004, was parked next to another vehicle that burned to the ground. While the Pilot never caught fire, the driver’s side suffered some serious melting. The car went into the body shop, all new parts were ordered from Honda, and the car was put back together, good as new.
- Theft. In some states, cars that are stolen are classified as a total loss. When recovered, they generally don’t have major damage other than cosmetic issues that are fairly easy fixes. Stolen cars make great salvage cars!
- Collisions. Late model luxury cars involved in accidents can be expensive to repair, and it doesn’t take total devastation to declare a car such as a Mercedes-Benz E-Class a loss. Body damage and mechanical parts can be repaired, so buying salvaged could save you a bundle.
If you find a salvaged vehicle you’re interested in, do three things. First, realize that very few dealers will take salvages on trade-in, and they can be hard to resell privately. Make sure you want to keep it for a while! Second, check the car’s price by looking up the value of the same model to compare prices of cars with clear titles. (CarGurus offers a cool new pricing tool that’ll get you started.) Finally, have the car inspected at a body shop! They will be able to look for evidence of water damage and inspect the frame.
If you’re patient, on a tight budget, and know what to look for, there’s no reason a salvaged vehicle can’t provide years of reliable service.
Would you consider a vehicle with a salvage title?