Something to Salvage
Eric wants to know what Dave thinks of salvage titles when purchasing a car.
QUESTION: Eric in Washington is looking to buy a better car. He has researched different options and wants to know what Dave thinks about salvage titles. What does Dave think?
Dave's ANSWER: They are definitely not worth as much as a regular car. The main reason is because the resale value is going to hurt. The first problem is that you have to get a deep discount based on other cars of similar make and mileage and so forth. The reason is because you'll have to drive it a while. When you get ready to sell it, you're going to sell it cheap, and it will take you a while to sell it. They are harder to sell because people are spooked by them.
If I were going to drive it for a long time, I wouldn't be spooked by a salvage title, depending on why it was salvaged. If it was flooded, I'll probably pass because computers get fried and rust gets in wires. They claim they can fix them, but that's a tough one. If it's a salvage title because it got totaled, let's look at what the wreck was and that might be all right because there are a lot of people who know how to rebuild a car. It might end up better than it was when it came out of the factory because someone really knows how to put a car back together.
Ask why it was salvaged and if you're going to keep it a long time. Ask yourself if you're going to get it at a steep discount and will you be okay with selling it at a deep discount, and with it being harder to sell later. The last thing is to check with your insurance people and make sure you can get insurance without any trouble.
If the seller can't tell you why it was salvaged, walk away. They know, or they can get the information, or maybe CARFAX can get it for you. Sometimes a tornado comes through town and a tree falls across the front. That's a totaled car. It may not even be a wreck. The one that scares me the most, because I'm not a mechanic, is that water just doesn't do good things to cars.
It all has to do with why it's salvaged, and you have to get to the bottom of that. If you can't, walk away.