Financial Advice

Saving with a “Salvaged Title” Car

Many families need a reliable, spacious vehicle. For many, new vehicles are unaffordable. According to Kelley Blue Book, the average cost of a 2015 vehicle is over $33k. Ouch. That’s why many are looking for affordable options. Some are considering buying a wrecked vehicle that has been repaired or can be. Prices are drastically reduced, which makes them very appealing. While it may not be an option for everyone, guidance is needed to make the safest choice possible.

Common sense tells buyers to look for light damage; however, most don’t know what should be avoided. With the right professional advice, an informed decision can be made. A professional can determine the extent of damage, needed repairs, and safety factors. Even if the vehicle has already been repaired, it should be properly inspected.

Rodney Goins of Goins Automotive in Shelby, North Carolina has been in the auto repair business for 31 years. As a body repair expert, he has extensive experience in salvage repair. He feels there are four types of damage that should be avoided: all water damage (especially salt water), cowl damage (located at front door hinges), major front-end damage (can damage sensors), and rear damage to hybrid vehicles (can damage battery). Mr. Goins advises that major frame damage should be avoided, but light frame damage can be repaired easier now than in the past. Your body repair expert can alert you to what vehicles should be avoided.

Mr. Goins says other light damage may be acceptable. Examples are light rear damage (except to hybrid vehicles) and hail damage. If you’re considering a hail-damaged vehicle, he advises to inspect for water damage. Another option is a theft recovery vehicle that has little to no damage. A professional can determine safety and extent of damage.

Choose an expert with multiple years of repair experience and favorable reviews. If you don’t know one, contact your local Better Business Bureau. Another option is to find one through social media outlets; ask others for recommendations and then follow up to meet them and inspect their backgrounds. Mr. Goins says not to "be fooled" by certifications; some only require a class and test. Instead, look for salvage experience and familiarity with state laws. Once you find a trusted professional, ask if they will inspect a damaged vehicle. If so, confirm their inspection fee. If possible, it’s best to accompany them during the inspection. This will allow time for questions and concerns to be addressed. If it passes inspection, you can then decide if it’s the right vehicle for you and your family.

If you decide on repairs, create a contract. It should outline repairs, parts, and labor costs, as well as an estimated period for completion and be signed and dated by both parties. In the event of damage or theft, confirm that the shop has insurance and include it in the contract.

Loan requirements vary, and many lending institutions don’t offer loans on salvage vehicles. April Sprague of State Employees Credit Union in Shelby, North Carolina advises that financial institutions have varying policies and procedures; it’s best to check with each one. She adds that lenders want to be helpful and may be able to offer alternate loan options if a traditional vehicle loan isn’t viable. It’s best to investigate options before a purchase is made.

It’s worth noting that title laws vary from state-to-state. For example, North Carolina requires that a repaired salvage vehicle pass an inspection by an official DMV (Department of Motor Vehicles) inspector. If it passes, a Rebuilt Title is issued and it can be returned to the road. Other states may vary, so check your local DMV for guidelines and procedures.

Many buyers have purchased salvaged vehicles with satisfactory results; two of those live in Dallas, North Carolina. Years ago, Jerry Thomas purchased a wrecked 1996 Chevrolet truck. It had light damage to the front and side. He purchased and repaired it for a fraction of the cost of a new vehicle. He felt it was one of his most reliable vehicles ever owned. He added that he later purchased other salvage vehicles with gratifying results. His friend, Ronnie Wiggins, added that one of his favorite vehicles was a 2004 Chevrolet Impala with salvage history. He also had good results and drove it for years. Both said they would purchase another salvage vehicle if the price fit their budget.

If budget restrictions hinder your vehicle purchase, a salvage vehicle may be an option. While not for all consumers, big savings are possible for those willing to take the necessary steps. By following regulations and hiring an expert, a salvage vehicle might stretch your dollars and fit your family needs.

Kelli is a freelance writer who lives on a small horse farm in the North Carolina foothills. She lives with her husband, horses, dogs, and bossy cats. Her hobby is saving money. Today she’s sharing her writing with Visit today for more on how to buy a cheap, reliable used car and buying an insurance friendly car.

This article by Kelli Clevenger first appeared on The Dollar Stretcher and was distributed by the Personal Finance Syndication Network.