How to Check for a Salvage Titleby Jackie Lohrey
A lack of federal regulation and widely varying state laws mean that while it’s not likely, it is possible that a car you’re considering -- or perhaps a car you already own -- should have a salvage title. According to the Federal Trade Commission, a currently clean title does not necessarily mean that the car is clean. In addition, warning signs are not always readily evident. This makes it vital to check the repair and title history of any used car you’re considering, even if you do not suspect the vehicle has sustained previous damage.
What Does Salvage Mean?
The term “salvage” means that an insurance company has declared a vehicle a total loss. This usually means the vehicle has been in an accident in which the damage exceeds anywhere from about 50 percent to 90 percent of the value of the car. However, it also could mean the vehicle sustained weather-related damage or that it was reported stolen and recovered after the insurance company paid the loss claim. Regardless, the car will be retitled as a salvage vehicle as a warning to potential buyers.
State laws vary on how a salvage title appears. In some states, a salvage title is printed on a different color paper. In others, the term “salvage” is stamped on the original title.
Check the VIN Number
A vehicle priced well below comparable makes and models is a common signal that the car may have a salvage branding. However, even if it’s priced comparably and appears to be in good condition, the FTC recommends that you always run the vehicle identification number through one or more database services. VIN services collect and display information from insurance companies, state and local governments and salvage yards.
Options include fee-based services such as Carfax and the National Motor Vehicle Title Information System run by the U.S. Department of Justice. There also are free services provided by the National Insurance Crime Bureau and companies such as VinFreeCheck.
Conduct an Independent Inspection
Edmunds recommends that you either bring a professional mechanic with you or take a vehicle you’re considering to a professional repair shop. In addition to assessing the car’s general condition, an independent inspection can uncover potential body and repair issues that may affect a buying decision.
The FTC encourages you to report any car dealer that you suspect may be committing title fraud. Reporting options are your car insurance company, your local police department or the National Insurance Crime Bureau.