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So, you’re in the market for a used car. With any luck, you’ll find a reliable car that can hold its value after the previous owner has taken the biggest depreciation hit.
Buying a used car, however, requires due diligence from the buyer. Meaning, you don’t just take the seller’s word at face value. There may be problems the seller is hiding or are unaware of themselves.
The listings page will show you a photo of the car and give you basic information such as the seller’s asking price, the odometer reading and condition. But you may be wondering…
- Am I buying a junk car?
- Am I paying more than the car is worth?
- Is it unsafe to drive?
The vehicle title check is one key to finding answers to these questions.
What Can a Vehicle Title Tell You?
A certificate of title serves as proof of your ownership when you buy a car. The state department of motor vehicles (DMV) or the department of transportation issues the title after the sale. Bearing your name as the owner, this document can also be held by a loan company or lender if you take out a loan on the car. A certificate of registration, on the other hand, proves that your car is legally permitted on public roads.
What is a Title Brand?
A brand may also appear on the title document to indicate something about the condition or history of the vehicle. It may indicate that the vehicle has been declared a total loss, repaired or rebuilt, damaged in a flood, involved in an accident, or has a rolled-back odometer. The set of brands and their definitions may vary across states because of differences in policies and laws governing vehicle registration and titling. What’s considered a clean title in one state may not be clean in another state.
Here are the most common brands:
- Clear indicates that the title is cleared for reselling or has no issues. Some states explicitly write the “clear” brand while others will not put any brand at all.
- Salvage or totaled indicates that a damaged vehicle has been declared by an insurance company a total loss or the cost of repair will exceed the vehicle’s value.
- Rebuilt or reconstructed indicates that the vehicle has been previously declared a salvage vehicle but was rebuilt and after inspection, is now deemed by the state to be safe for the road.
- Junk indicates that the vehicle has been sold to be disassembled for parts or scrap metal to a junkyard. Some states use this brand to refer to salvaged vehicles.
- Lemon indicates that the vehicle (still under warranty) has a part that has malfunctioned several times that makes it unsafe for the road.
- Water damage indicates that the vehicle has been damaged by water most likely due to a flood or other weather disturbances. Some states use terms like Flood to indicate the specific cause of the damage.
Policies and laws governing vehicle registration and titling vary across states. What is considered a clean title in one state may not be clean in another state.
Should I Buy a Vehicle with a Branded Title?
Well, that’s up to you, but here’s a list of things to consider:
- A rebuilt salvage vehicle is considered safe to drive on the road, and as long as you are ok with the damage, you may be able to negotiate a better price for the vehicle if this brand was not declared by the seller. Branded titles can have issues that could potentially compromise your safety on the road.
- Not too many insurance companies are eager to cover this kind of vehicle.
- It won’t be easy to find a buyer when you decide to resell it.
- Your options for financing would be limited because most loan providers prefer vehicles with a clean title. With a clean title, however, your loan application is more likely to go smoothly.
How to Check Title Problems for Free
Step 1: Get the Vehicle Identification Number (VIN), The dealer or private seller can give you this 17-digit code. If you’re shopping online, most car market websites provide the VIN.
Step 2: Run a free title search through one of these providers:
- National Insurance Crime Bureau’s VinCheck can tell you whether the car has been deemed a salvage vehicle or stolen but not recovered, based on data provided by participating NICB member insurance companies. You can do a title search for up to five vehicles within 24 hours per IP address. The NICB is a non-profit organization whose mission is to fight insurance fraud and other crimes.
- The Department of motor vehicles (DMV) or similar state agencies may provide free title search services, but most states charge a minimal fee. DMVs have their own database of vehicle information collected from vehicle registration and title records.
- Paid vehicle history providers may offer a free version of their vehicle search services with the option to pay the premium for more details or relevant information.
- Free VIN check providers like VinCheck.info offer a comprehensive vehicle history that covers registration, liens, theft, salvage, and title records plus other critical information about the car. Another free vin check site is Vehicle.report
Free title check or VIN check services are available online. Cars with good vehicle history can give you the best deal when buying or reselling a car, or getting a loan at LoanMart.