Vehicles that have been damaged enough where the costs to repair are more than the actual cash value of the vehicle may have a salvage title. The exact criteria for a vehicle to hold a salvage title varies across states. However, the idea is the same. The title is marked as salvage and is designated as a seriously damaged vehicle. The title remains a salvage title unless the vehicle is restored to acceptable conditions to which the title is given a “rebuilt salvage” designation.

Salvage titles are safeguards for consumers to be aware that the vehicle has had serious damage at one time in its life. There is, however, a possibility that the salvage designation could be removed over many transactions across many states. Because of this, consumers and dealerships both need to consider the risk before purchasing a used car. There are many resources out there to assist in this matter.

The Department of Motor Vehicles (DMV) maintains a database of every car that has once been declared salvaged. This database depends on the honesty and accurate reporting of every state so should not be the only resource used. Another common resource is a vehicle history report. There are many private companies that will do research on the complete history of the vehicle using its vehicle identification number to provide assurance that the vehicle has a clean title. There may be a fee for this report but will be worth it in the long run.

If a dealer is aware of a vehicle having a salvage title, this must be disclosed in the sale of the vehicle. If not, they will be committing fraud and can result in undesired consequences. Be sure to check with the state to find the exact criteria for a salvaged title and remember to do research on vehicles before purchasing them.