What Does a Salvage Title Mean?

When a car gets damaged and can no longer be driven safely, it is considered salvaged by an insurance company. During this process, a salvage title is assigned, permanently marking the car as having been salvaged at least once and unable to be driven on public roads. To be clear, after a car is issued a salvage title, it can no longer be registered in the United States for on-road use.

What Does it Mean for a Vehicle to be Salvaged?

To be considered as a salvaged vehicle, a car typically needs to be in an accident that results in more damage than its insurance value. This insurance value can be the repair cost minus the value of any totaled parts. If the repair cost is more than the car’s value, the car can be deemed to be a total loss, and a salvage title can be issued.

A salvage title typically states that the car is not suitable to be legally operated, but they can also be issued for other reasons such as floods or fires. There are generally three different types of salvage titles. The three reasons are: total loss, theft recovery, and non-repairable.

What Are The Different Types Of Salvage Titles?

A total loss title, is the most common reason for a salvage title to be issued, when a vehicle is considered by an insurance company to be a “total loss” due to an accident. This title is issued when the cost of repairing the car is more than the car’s value.

A theft recovery title is issued when a car is reported stolen and recovered, but not all parts of the car are accounted for. The title states that the car can no longer be legally operated and is to be used for parts or rebuilt.

The last type of salvage title is a non-repairable title. This title is usually given to cars that have been damaged in an accident that the insurance company determines to be too severe for repair. In some cases, a car can be issued a non-repairable title when an insurance company has determined that it is too expensive or impractical to fix a vehicle and the owner decides not to have the car repaired.

What Are The Risks Of Buying A Salvaged Vehicle?

There are risks associated with buying a car with a salvage title. Insurance companies commonly underreport or fail to report damage when issuing a salvage title, meaning that a vehicle could have more damage than the title implies.

For those with the time and skill it is possible to turn a salvaged vehicle into a functional car again, however, there is a huge range of potential costs and liabilities that come with buying a salvaged car. When considering buying a salvaged vehicle, it is always a good idea to take it to a qualified mechanic for an inspection prior to completing the purchase.

In most states, cars with a salvage title will be required to be inspected and re-certified before they can be registered and driving on public roads. This involves making sure the car is road safe, has been properly repaired, and is up to date on all necessary certifications. Additionally, cars with a salvage title cannot be financed legitimately and will usually require a cash payment for the purchaser to own the vehicle.

In conclusion, a salvage title is used to certify a car that has been damaged beyond repair or declared a total loss. There are risks associated with purchasing a car with a salvage title, such as potential unreported damage and the need for further certifications. It is important to be informed on the potential risks and liabilities when purchasing a car with a salvage title.