Clean Title vs. Salvage Title: What To Look Out For

Knowing what you’re getting into is important when purchasing a secondhand vehicle. Making sure that you’re getting your money’s worth is top priority. A lot of things you need to check can only be done in person, but a few can be deduced right from the advertisement page.

The title is one such factor. It’s one of the most important documents when buying a secondhand vehicle since it serves as proof of ownership. You’ll notice that many sellers list a “clean title” as a feature in their advertisements. Alternatively, you may see some dealers selling vehicles with “salvage titles” for low prices. So, what’s the difference, and why does it matter to you?

Buying a Vehicle With a Clean Title vs. a Salvage Title

Buying a vehicle with a clean title is the safer, more straightforward option. A clean title implies that the vehicle is roadworthy and can be driven without much concern. On the other hand, a salvage title indicates that the vehicle can no longer be driven on the road until it’s repaired and given a rebuilt title.

How To Tell if a Vehicle Has a Clean or Salvage Title

A vehicle’s title will have a stamp or a watermark that shows that it’s a salvage or rebuilt title. If you have any doubts, you can always check on the vehicle’s identification number (VIN) with the Department of Motor Vehicles (DMV) or your local tag agency. They’ll have a record of the vehicle’s history and current title status. There are also VIN checkers online that can do the same thing.

Either way, the title’s status can only tell you so much. It’s best to have the vehicle checked by an independent mechanic before buying it. A mechanic is better equipped to tell you if the vehicle is worth the asking price and if there are any issues you need to know off the bat.

Think of title types as glimpses into a car’s history. Each one has their own nuances.

What Does a Clean Title Mean?

All new vehicles start out with a clean title. Having a clean title means that it’s legal for you to drive the vehicle on the road. In addition, no insurance company has labeled the vehicle as totaled. A totaled vehicle is one that’s been very badly damaged. The cost of repairing the damages to a totaled vehicle sometimes exceeds the worth of the vehicle.

From the onset, a clean title sounds like the better of the two. However, even if a vehicle has a clean title, it doesn’t mean that the vehicle has never been in any major accidents. It also doesn’t guarantee that the vehicle is in good condition. There are benefits and a few drawbacks to having a clean title, as seen here:

Advantages of

Vehicles with clean titles are more likely to be safer to drive, cheaper to insure, have better resell value, and are easier to register.

Safety

When a vehicle has a clean title, you’re legally allowed to drive it around, implying it’s safe enough to be roadworthy.

Insurance

A vehicle with a clean title is easier and usually cheaper to insure.

Resalability

If you plan on reselling your vehicle in the future, a clean title looks better on paper and carries no restrictions.

Registration

When your vehicle has a clean title, you can bring it to the DMV for registration and new plates.

Disadvantages

A secondhand car with a clean title isn’t guaranteed to be free from issues. At the same time, vehicles with clean titles may cost more than those with rebuilt or salvage titles.

False Security

While vehicles with clean titles are meant to be safe to drive, secondhand ones can still have hidden, undisclosed issues. Don’t allow yourself to have a false sense of security because the vehicle has a clean title. Examine any vehicle you buy secondhand thoroughly before payment.

Higher Price

Vehicles with clean titles tend to sell for higher prices than those with salvaged or rebuilt titles.

What Does a Salvage Title Mean?

When a vehicle is deemed totaled by an insurance company, it’s legally required to be registered under a salvage title. This is also the case if it’s proven to be unfit to be on the road. Vehicles with salvage titles aren’t street legal until they’re repaired and issued a rebuilt title. The law varies in most states, but a salvage title is usually issued to a vehicle when the cost to repair it equals 50% or more of the vehicle’s value.

Like clean titles, salvage titles have their benefits and drawbacks:

Advantages

Vehicles with salvage titles are less expensive than those with clean titles, give buyers a better insight into the repair history of the vehicle, and are often bought for their parts.

Price

Vehicles with a salvage title are much cheaper to buy than those with rebuilt or clean titles.

Transparency

When buying a vehicle with a salvage title, you have a good idea what you’re getting into. It’s illegal in the US to sell a vehicle with a salvage title without disclosing it to the buyer.

Parts

One good use for salvage titled vehicles is for parts. If you can find one with decent parts, you can always use it to fix up one of your other vehicles or sell them for a profit.

Disadvantages

Vehicles with salvage titles are often more expensive to repair, may require extensive servicing before they become road-legal, and can’t be insured.

Repair Cost

Depending on what state issued the salvage title, repairing the vehicle may not be worth it. Some states will issue a salvage title when the cost of repair is 100% of the vehicle’s value, meaning no matter how cheap it is, you’ll end up spending 100% of its value getting it fixed.

Usability

Salvage-titled vehicles aren’t legally allowed on the road. Even if you have the vehicle repaired, you’ll need to apply for a rebuilt title before being allowed to drive it again.

Insurance

Insurance companies won’t insure a vehicle with a salvage title.

Lack of Safety

Salvage titled vehicles aren’t allowed on the road for a reason: They’re unsafe to drive. Many have flaws that pose a danger even after being repaired and allowed back on the road.

In the end, a vehicle’s title can say a lot about its history. While it’s always best to see it in person, the title can help you decide if the vehicle you want to buy is even worth the trip.

Should I Buy a Car With a Clean or Salvage Title?

The choice is up to you whether you want a car with a clean or salvage title. However, it’s generally easier to get a vehicle with a clean title since you won’t have to jump through hoops to legally drive the car on the road.

While they cost more than cars with a salvage title, clean titles are more reliable and could cost you less in the long term since you won’t have to pay for expensive repairs to get your vehicle considered legal.

Lastly, clean title cars are far safer than ones with a salvage title, as mentioned above. Salvage-titled vehicles are unsafe, hence why they’re not allowed on the road.