October 23, 2021

Auto Salvage Titles: What They Are and Why They Matter

Most auto salvage yards (also known as junkyards) have a large inventory of vehicles that have a “salvage certificate.” The reason the certificate was issued varies from car to car, but the receiving process is roughly the same in each state and includes the following steps.

  1. The insurer conducts a damage inspection.
  2. The cost of repairing the damage exceeds at least 70% of the value of the car
  3. The driver’s insurance company declares the vehicle a “total loss”
  4. State motor vehicle agency issues salvage certificate

Once the car receives a salvage certificate, it cannot be driven, sold, or registered, unless it is repaired. After repairs are made, the vehicle must pass a safety inspection before it can receive a new title. Unlike the certificate, the title allows the car to be driven, sold and registered. To help drivers make smart car purchases, the title indicates that the vehicle has been recovered and rebuilt.

Reasons for salvage titles

Now that we’ve looked at how auto salvage titles are created, let’s see why they ‘re created. Listing all the reasons a car could be salvaged would require a book, but there are some types of damage that state motor vehicle agencies see more often. than other types, in particular:

  • Flood damage
  • Wreck damage
  • Damage by hail
  • Vandalism
  • Fire damage
  • Theft damage

Salvage vehicles sell for much less than second-hand non-salvage vehicles, making them attractive to drivers who need to buy a car on a budget. Should you consider buying a salvage car?

The answer depends on two things: the type of damage that resulted in the recovery state, and how you plan to use the car. For example, there is a big difference between surface damage from hail and damage caused by a crash that breaks the engine block. There is also a big difference between driving the car many miles each day and using it as a backup vehicle. The less wear, the better.

Some people drive a salvage car and experience no unusual mechanical or safety problems. However, because auto salvage vehicles are considered to be less reliable than non-salvage vehicles, consumers are generally advised to avoid them. Salvage cars are priced to sell, but ideally purchased as a last resort if you need a car for your daily commute.

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