How to Determine the Salvage Value of a Car


Salvage vehicles have survived an accident, a theft or a flood and have been issued a "total loss" certificate by an insurance company because the cost to repair the damage exceeds a certain percentage of the vehicle's cost. The percentage varies from state to state, as does the terminology. Some states indicate a salvage status on a car's title with the term "total loss" instead of "salvage"; others use such terms as "rebuilt/restored" or "flood loss." Regardless, salvage vehicles can be purchased for much less than other types of used cars because salvage value is how much a car is worth at the end of its useful life. It is a relatively subjective figure, ultimately determined by the company insuring the salvage vehicle, but you can calculate an estimate.

  • Look up the vehicle's retail value at Kelley Blue Book's website (see Resources).

  • Determine the vehicle's wholesale price or trade-in value by looking it up through National Automobile Dealers Association (see Resources).

  • Total the two figures and divide the result by 2 to get the car's current market value.

  • Determine the percentage used by the insurance company that deemed the vehicle a "salvage vehicle." This is often 75 percent of the market value, but each insurance company determines the percentage it uses.

  • Multiply the vehicle's current market value (from Step 3) by this percentage to get an estimated salvage value.

Tips & Warnings

  • If you do not know which insurance company is involved, use a few percentages (70, 75 and 80, for example) in the equation to get a range of possible salvage values.

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