California seems to be on top of the issue of salvage titles with the California used car salvage law. According to a state website, The California Department of Consumer Affairs found that more than 700,000 structurally damaged and 150,000 salvaged vehicles are returned to streets and highways every year without a safety inspection, and pose a potential hazard to all of the state's motorists.
In almost all cases, salvage title is given to any vehicle that has sustained damage worth 75% or more of its value. Requirements are going to vary by state. In Florida, a car has to be damaged to 80% of its value before the accident. Vehicles in Minnesota are considered salvaged when they are declared "repairable total loss" by an insurance company, were worth at least $5,000 before the damage or are less than six years old.
Here is a look at the salvage title law in California, the most populous state in the U.S. and home to a car-loving culture that could just prey on unsuspecting used car buyers.
The State of California "brands" its titles. These brands indicate the vehicle's past history. Here are the state's definitions of those brands as reported on the California Department of Motor Vehicle website.
Salvaged: Vehicles marked with a "salvaged" brand were involved in an accident or incurred considerable damage from another source, such as a flood or vandalism. This brand includes previously dismantled (junked) vehicles.
Original Taxi or Prior Taxi: Vehicles formerly used "For Hire" which usually have high mileage.
Original Police or Prior Police: Vehicles formerly used by law enforcement and which usually have high mileage.
Non-USA: Vehicles manufactured for use and sale outside the United States which have been converted to meet Federal and California safety and emissions standards.
Warranty Return or Lemon Law Buyback:Vehicles which have been returned to the manufacturer under California's Lemon Law.
Remanufactured; Vehicles constructed by a licensed remanufacturer and consisting of used or reconditioned parts. These vehicles may be sold under a distinctive trade name.
The California website does an excellent job explaining the definition of salvage titles and what to expect. Here are some excerpts from the website:
A salvage vehicle is a vehicle that has been wrecked or damaged to such an extent that it is considered too expensive to repair. The title, license plates, and a required fee are submitted to the Department of Motor Vehicles (DMV) and a Salvage Certificate is issued for the vehicle.
Although many salvage vehicles are expertly repaired, some vehicles: are not properly repaired and/or tested and may be dangerous to operate and have been repaired with stolen parts. If the California Highway Patrol or DMV determines the vehicle or its parts have been stolen, the vehicle cannot be registered and the vehicle or parts will be seized.
Sellers, including dealerships, are legally required to disclose the vehicle's salvage title and history, but the law is difficult to enforce, especially when cars come in from another state. I'm not trying to sound like a commercial for CarFax, but the service can be invaluable when dealing with used cars that may be from other states.
The website also reports some of the following "clues" may indicate the vehicle has an undisclosed salvage history.
- Signs of major repairs on the inner fender structures.
- Mud, mold, or rust under the carpet in the trunk.
- Vehicle Identification Number (VIN) plate attached with materials other than rivets.
- Safety restraint light is always on.
- Airbag covers are resealed or improperly installed.
- National Highway Traffic Safety Administration (NHTSA) labels which usually appear on doors, inside hood, tailgate, or hatchback are missing.