Salvage, Rebuilt, and Title-Branded Vehicles Flashcards
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Read the first 6 Salvage, Rebuilt, and Title-Branded Vehicles flashcards as text
What is a 'salvage title' in the context of U.S. vehicle registration?
Answer: A title issued when an insurer declares a vehicle a total loss and takes ownership
A salvage title is branded onto a vehicle's title when an insurance company pays a total loss claim and acquires the vehicle, indicating it has been declared a constructive or actual total loss.
What threshold do most U.S. states use to declare a vehicle a total loss for title-branding purposes?
Answer: When repair cost meets or exceeds a stated percentage (commonly 75–100%) of the vehicle's actual cash value
Most states brand a title when repair costs reach a threshold—commonly 75% to 100% of ACV—though the exact percentage varies by state law.
A vehicle with a salvage title has been repaired and passes a state inspection. What title brand does it typically receive?
Answer: Rebuilt or reconstructed title
After a salvage vehicle is repaired and passes a state safety inspection, the state re-titles it as 'rebuilt' or 'reconstructed,' permanently noting its salvage history.
How does a salvage or rebuilt title typically affect a vehicle's market value compared to an equivalent clean-title vehicle?
Answer: It significantly reduces market value, often by 20–50% or more
Title branding causes substantial market value reduction because buyers perceive higher risk, many lenders refuse financing, and resale options are limited.
What is 'title washing' and why is it a concern for automotive appraisers?
Answer: The fraudulent practice of retitling a salvage vehicle in a state with lenient title laws to obtain a clean title
Title washing involves retitling a salvage vehicle in another state that may issue a clean title, concealing the vehicle's damage history and defrauding buyers.
Which database is most commonly used by U.S. appraisers to check a vehicle's title and loss history?
Answer: CARFAX or AutoCheck (powered by Experian), which compile title, accident, and total-loss records
CARFAX and AutoCheck aggregate DMV title records, insurance total-loss reports, and accident data, giving appraisers a comprehensive vehicle history report.