What You Need to Know About Salvage and Rebuilt Title Cars


Should You Buy a Rebuilt Car?

Anyone who’s shopping for a car is looking to get a great deal. Ultimately, it comes down to wanting to find the greatest car, for the lowest price. Depending on how much you’re looking to save on a car, you may at some point consider buying a car with a rebuilt title. But with rebuilt title cars come many considerations. In this article, we’ll explain:

  • What a rebuilt title car is and what a salvage car is
  • Why rebuilt title cars are generally cheaper
  • When rebuilt cars are a good deal and when they should be avoided
  • How to avoid “title washing” scams

What’s the Difference Between a Rebuilt Title Car and a Salvage Car?

The main difference between a rebuilt title car and a salvage car is that a salvage car has not yet been fixed/rebuilt. When a car is considered “salvage”, it’s not street-ready and requires repairs. Once the car has been rebuilt or repaired, it is considered a rebuilt title car and is now street-ready.

  • A “salvage” title means that an insurer has determined that the vehicle is a total loss. This could be due to a major accident, theft, fire, flood or extreme weather condition that caused significant damage.
  • Once a salvage car has been restored and considered street-ready, its title switches to “rebuilt” status

Things to Consider Before Buying a Car With a Salvage Title

Car’s with a salvage title will often be sold for significantly reduced prices due to the risk associated with them. In most Canadian provinces, if a car is stolen and not recovered within 21 days, it is considered a total loss by the insurer and the owner is paid out by the insurance company. If the car is recovered, despite it having absolutely no damage, it would still be considered a salvage car. In this case, you could get an amazing bargain by buying an undamaged, previously stolen car. This also applies if a vehicle was in an accident but most of the damage is cosmetic and won’t create any mechanical issues. 

On the flip side, there’s a good chance that a salvage car has considerable damage whether it be from an accident, extreme weather condition or fire. In this case, a lot of the damage won’t be visible until the vehicle is looked at by a mechanic. Many cars with a salvage status will never be street-ready again. In order for a car with a salvage status to become street-ready and insured, it needs to be inspected and certified by a licensed technician. 

Things to Consider Before Buying a Car With a Rebuilt Title

Rebuilt cars are a much safer option than cars with a salvage title, but they still have their risks. While they have been restored and certified by a licensed technician, there is still the possibility of recurring issues. It’s hard to know if the repairs will only hold for a certain amount of time. The other issue is with financing a car with a rebuilt status. Lender’s often avoid financing vehicles with rebuilt titles due to their reduced value. However, if you do find a rebuilt title car that seems to be in great condition, you can save 20 to 50% compared to the same vehicle with a “clean” title. 

Questions to Ask Yourself Before Buying a Rebuilt or Salvage Title Car

If you find yourself seriously considering buying a car with either a rebuilt or salvage title, you’re going to want to ask these questions:

  1. “Are there receipts I can see?”. If the seller is the person who had paid to have the car repaired, you should ask him/her to show you the receipts. This way you can see exactly what was done on the car, where it was done and if the parts used to repair the vehicle are of good quality. If there’s any hesitation in showing you the receipts, you should probably walk away.
  1. “Has the car been insured?”. If the last owner of the vehicle was able to insure the car, you should be able to insure it as well. If the seller was not able to insure the car, this is a big red flag. 
  1. “Who did the repairs?”. You want to be sure that whoever did the repairs on the vehicle was a reputable mechanic or shop. If the owner’s friend down the road fixed up the car, you’ll probably want to avoid buying it. 
  1. “Was there powertrain or frame damage?”. The reason you should ask these two questions is because they are the most expensive parts to repair. It’s possible that the owner had the mechanic cut corners to keep the costs of repairs down. If there was in fact damage to either of these two parts, proceed with caution. 
  1. “Have the repair costs been estimated?”. While this question only applies to a salvage title car, it’s one that needs to be asked. You need to know if the owner has already gotten a quote for how much the repairs will cost and be ok with paying for those repairs. 

After you’ve asked all of these questions and heard the answers you want to hear, it’s time to have a licensed mechanic come to inspect the vehicle. Have them ensure that the vehicle has been restored properly so you don’t end up with a vehicle that’s bound to break down in the months after buying it. It’s also a great idea to take it out for multiple test drives to see if it drives smoothly and without any concerning noises. 

Watch Out for Car Title Scams

Unfortunately, scammers try and take advantage of buyers by doing something called “title washing”. While this process is illegal, it’s not uncommon for scammers to buy a car with a rebuilt or salvage title and have it insured in a new province and removing the title. The scammers then make thousands of dollars by selling it to a buyer while claiming it’s a clean title. 

One of the best ways to avoid this type of scam is to run a CARFAX report and see the complete history of that vehicle. All you have to do is put in a 17 digit VIN number and then you’ll be able to learn everything there is to know about that vehicle. 

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