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A salvaged car is defined as a vehicle that has been deemed a total loss by the auto insurance company due to major damage and has been given a salvage title, which affirms its lack of value. Because salvaged cars are worth next to nothing, you can purchase one for a rock-bottom price. But is that a wise idea? Here are some factors to consider.
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A car can get a salvage title when it endures severe or widespread damage that would cost more than the car’s current value to repair. After an accident or act of nature that causes the damage, the vehicle owner makes an insurance claim on the damage. The insurance company can give it a salvage-designated title in order to pay out the vehicle’s value rather than the cost of repairs.
Most people think of salvage title cars as ones bearing extreme structural damage received via collision, but that’s not always the case. Some lower-value economy cars can receive salvage titles for cosmetic issues, like external hail damage or minor upholstery damage from flooding. A salvaged car may still run fine or just need a certain expensive part replaced.
The most obvious benefit to buying a salvage title car is saving money. Salvage titles can cost half as much as an identical model with a clean title — or even less. Also, insurance costs far less because the insurance company will pay hardly anything if something happens to it.
Be warned that there are many risks to buying a salvage title car, especially if you don’t properly do your research. You’ll need to be able to pay for the vehicle out of pocket because very few sellers or financial institutions will finance a car with a salvage title.
You’ll want to have the vehicle thoroughly inspected to ensure that it will run safely and won’t pose a danger to you. If it does need major repairs, get an estimate of how much the services will cost so you can decide if it’s actually a good deal in the end.
If you decide to buy a salvaged car, rigorously research the vehicle before handing over the money. Don’t purchase one that doesn’t have a thoroughly documented history of maintenance and accidents. Look through the records to see why the car’s title was deemed a salvage. Have a mechanic you trust inspect the car from bumper to bumper to identify any hidden issues.
Unless you want to make that gamble, you may be better off avoiding the potential risks of a salvaged car by purchasing a pre-owned vehicle from a car dealership instead. It does cost you more money upfront, but the extra dollars could be worth the peace of mind of having a dependable product with better resale value.
Aaron is unashamed to be a native Clevelander and the proud driver of a Hyundai Veloster Turbo (which recently replaced his 1995 Saturn SC-2). He gleefully utilizes his background in theater, literature, and communication to dramatically recite his own articles to nearby youth. Mr. Widmar happily resides in Dayton, Ohio with his magnificent wife, Vicki, but is often on the road with her exploring new destinations. Aaron has high aspirations for his writing career but often gets distracted pondering the profound nature of the human condition and forgets what he was writing… See more articles by Aaron.
