What is a salvage title and how does a car title become salvage? A great question that many people don’t know the answer to! And going even further than that, in what circumstance would someone actually want to purchase a car with a salvage title? We would like to use this resource article to answer those questions for you.
Even though TFC Title Loans is in the lending industry, we know quite a bit about cars and think we ought to be a resource to our customers in more ways than just funding. Ever since first opening our doors in 1994, we have been extremely passionate about lender transparency, consumer education, and customer support.
With 25 years of experience under our belts, we are the oldest title loan lender in California and we wish to pass on all that knowledge we have acquired to you. If you are interested in learning more about salvage titles, then please continue reading the information we have gathered below. However, if you have stumbled across this page because you are interested in a title loan then fill out our online application right away!
The two most common ways cars become salvage are through major accidents or natural disasters:
If the car is very old or not valued very highly then the accident doesn’t even need to be very major. Even a tiny amount of damage to an old car can make an insurance company call it quits and say the vehicle is salvage. However, owners who are particularly attached to their older car can get a salvage title for it so it doesn’t need to go to the junk yard. A newer vehicle, or one that is valued very highly, will likely only become salvage after a very severe accident. The insurance carrier may want absolutely no part in paying for the damage even if you can find someone who could fix it. But once the insurance company says that it is not worth repairing, the car will receive a salvage title. Each state has different criteria as to what qualifies as salvage but most states tend to agree that a vehicle which requires repairs costing 75% of its total cash value is not worth repairing.
The most common natural disaster that leaves a car salvage is flooding. Salvage titles are important when it comes to vehicles that have been damaged by a flood because you cannot always see any visible damage. Once the water has dried up, the vehicle can look fine while the inner workings are damaged nearly beyond repair.
If you are able to do it smartly, there are a few ways you can benefit from buying a salvage title car:
Salvage titled cars are very inexpensive. There are sometimes even cheaper than they ought to be since there are no blue book sites that will value them so many previous owners part with them for mere pennies. This has especially been true since online used car sale sites have come on the scene like Craigslist and eBay. Many people are buying and selling cars with salvage titles on there all the time.
There are some insurers out there that will not cover salvage title vehicles at all and others can jack up the price due to “unknowns”, as they call them. However, if you are smart then you will shop around to find an insurer who will try to match the reduced value of the car with a lower premium so you not only get the car cheap, but get the insurance cheap as well!
Sometimes salvage title cars are bought as a way to keep the resale value high for a brand-new car that they have purchased. A household may decide to buy a high-value, nice new car that they plan to use for trips with the family or long distance travel whereas they plan to use a salvage for daily commuting so that they can keep the mileage down for the high-value car so it can make more money when the household decides to sell it.
If you are left with any remaining questions about salvage car titles, then please don’t hesitate a second to give us a call. We would be happy to answer any and all of your queries. If you are interested in getting a title loan through the services of TFC Title Loans, then fill out our online application on our homepage or give us a call today.