How to Buy a Salvage Title Car, Saving You Thou$ands

One man's trash is another man's treasure!

If you can pay cash for a car, you'll be surprised at the car you can get! Buying a salvage title car sounds risky, but when all is said and done, you can have a reliable car for 50%-70% less than you'd pay for the same car from a dealership.

Things You'll Need

• Cash upfront
• A salvage dealer
• A body shop
• Some patience
• Flexibility

Instructions

1. Learn what a salvage title auto is, then get OK with it. When a car is wrecked and totalled by an insurance company, the cars are usually sold by the insurance company to auctions, dealers, etc. You, the cost-conscious car buyer, pay cash for a wrecked car, which you have repaired by a body shop. After the repairs, the car passes an inspection before it can be put on the road. It has been refurbished! Insurance companies will insure a salvage title car, usually for a lower value than a clear title car. (That's OK-- Lower premium!) Frequently, an insurance company will total a car without an enormous amount of damage, under certain circumstances. For instance, the car was brand new when it was wrecked, the wreck causes the car to lose its warranty, or the driver who was hit does not claim bodily injury. (The company is more likely to be lenient about totalling the car if they know there won't be any medical bills.)

2. Decide what you want in a car, but be flexible. What are the most important things to YOU? Gas mileage, luxury, leather, a great sound system? Make a list of your needs and wants, and which are deal breakers.

3. Locate a salvage car dealer, possibly online. The website may have photos of cars which are crashed up and their prices. When you find a salvage dealer that you like (for whatever reasons), call them and ask if they work often with a certain body shop.

4. Call the body shop and tell them the kind of car you are looking for. Sometimes the body shop will have "insider knowledge" of places to find good deals. (Certain auctions, etc.) Tell the body shop the TOTAL you want to spend. This will be the cost of the salvage car PLUS the repairs. IMPORTANT: make it clear that you do NOT want a flooded car, nor one with a bent frame.

5. The salvage dealer may look for the type of car you want, or you may simply be able to call and say, "At XYZ salvage dealership there is a canary-yellow lancer for $1500. Can we get that in good running shape for another $3000?" If the repairs will be more than what you want to pay, keep looking. When he finds the car for you, it will be time to buy the car, upfront.

6. The body shop repairs the car and you get the bill. Before you can get the car registered, it will need to pass inspection, which the body shop will likely do before he turns it over to you. With inspection and registration, the car is now yours!

Tips & Warnings

• Ask the body shop if they are going to have the car inspected on their own or if you are expected to have it inspected. This type of inspection can run about $40.

• Follow up with the body shop regularly so that your project doesn't fall behind.

• The salvage dealer may be willing to buy your car, either outright or as a trade.

• A community bank that does a lot of small business loans might be able to refer you to a dealer and/or body shop. These are business which need loans regularly to buy the cars they repair. Even better if you bank at the same bank!

• You are buying a wrecked car. There takes a certain amount of courage to pay cash money for something that looks really terrible.

• Check the BBB on the dealer and the body shop. Best bet is to use someone you know, or a friend of a friend.

• Be patient! Buying a salvage title car is a lot like building a house: It usually turns out just fine, but it rarely goes exactly as planned.

Resources

• Lorin who?
• Amazon's Lorin Neikirk page