The Cheap Car With the Complicated Title

A vehicle priced well below the others usually has a reason, and one of the most common reasons is a branded title. Understanding what that means before you look at the car saves an expensive education.

What the brands mean

• Salvage. An insurer declared the vehicle a total loss. It is not roadworthy or registerable in that state without going through the rebuilding process.
• Revived salvage / rebuilt. A salvage vehicle that has been repaired and passed the required inspection to return to the road. The brand stays on the title permanently.
• Non-repairable. The vehicle cannot be returned to the road at all. It exists for parts.
• Lemon law buyback and similar designations, which reflect a manufacturer repurchase rather than crash damage.

These are permanent. A rebuilt car does not become a clean-title car with time or with good behaviour.

What it does to insurance

This is where the honest answer is uncomfortable: it depends on the carrier, and some will not write physical damage coverage at all.

Liability is generally available — the vehicle still needs to be insured to be driven lawfully. Comprehensive and collision are the difficulty. Some carriers decline them on a branded title, some write them with conditions such as an inspection, and valuation in a total loss reflects the brand.

Ask before you buy, not after. In our office this is one of the calls where we most often have to give someone bad news about a car they have already paid for, and it would have been a five-minute conversation the week before.

What it does to financing and resale

Lenders are frequently unwilling to finance a branded-title vehicle, which narrows your options to cash. And when you sell, the brand is disclosed and the same discount that attracted you applies to you.

That is not automatically a reason to avoid one. It is a reason to treat the discount as compensation for a real, permanent limitation rather than as free money.

Questions to ask before you commit

1. What was the original damage — collision, flood, theft recovery, hail? Flood is the one to be most cautious about, because electrical problems surface long afterwards.
2. Who performed the repairs, and is there documentation?
3. Has it passed the inspection required to return to the road, and can you see that paperwork?
4. Will an independent mechanic of your choosing inspect it, including on a lift?
5. Will your insurer write the coverage you actually want on this specific VIN?

A seller unwilling to accommodate questions two through four has answered question one for you.

The straightforward advice

For a first car, a family car, or any vehicle you are financing, a branded title is usually more complication than the discount justifies. For a knowledgeable buyer paying cash for a second vehicle, with a clear-eyed view of what it will be worth later, it can be a reasonable buy. Decide which of those you are.

Considering a branded-title car? Send us the VIN and we will find out what can be written on it.