What Does Salvage Title Mean?
You may have heard the term salvage title when buying a used car. When selling your car privately you may be asked if the vehicle has a clean or clear title in reference to a salvage brand. A salvaged vehicle is one that has been damaged in major way. For example if a car has been severely damaged in an accident it will be made into a salvage title in some cases. It will depend on how badly damaged the vehicle is. The insurance company will pay off the owner of the vehicle, and it will be a written off as a complete loss. This means the insurance company will not repair the car and a check will be written out to the insured for the estimated value. The car will then be offered back to the insured at reduced price or the kept by the insurance company. In most cases the car is repaired by a body shop that purchases the car from a salvage yard or from the owner of the vehicle and partially fixed to improve its cosmetic appearance. Some times the damage is less expensive to fix by a family owned body shop that has a lower cost of overhead, but this does not mean the vehicle will run optimally after the body and/or mechanical repairs.
You may also come across the term junk title. This may give you a better idea of what you are buying if you were to purchase such a car. Basically for a car to be a salvage or junk title it has to have lost at least three quarters of its value, 75% of the full amount of the vehicle prior to the damage being sustained. It isn’t just an accident that could do this – it could be a fire, flood damage or anything else as well. This 75% amount is a key fact to remember. It is a good rule of thumb that the automobiles value will be greatly reduced after a major collision that produces a salvage title. When buying this type of car or truck beware that there has been a major collision and to look over the car completely, or if possible by your local mechanic to make sure there is no major frame or mechanical damage to the vehicle.
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