One thing you have to know when buying a car is the state of the title. If you purchase a brand new vehicle, you will get a clean title that allows you to drive, insure, and register the car without incident. However, it is crucial you understand what kind of title you are getting with a used car.
The differences between a clean title vs. salvage title are essential to understanding what kind of car you are buying.
What is the Difference Between a Clean Title and Salvage?
A clean title is the most common title for new cars, and it is usually what used cars have. It means that the vehicle can drive on the road. Vehicles with clean titles can be registered and insured easily.
Salvage titles mean that the car has sustained some intensive damage and someone deemed it unsafe to drive. Different states will have specific requirements for a car to get a salvage title, so you may want to check in the titled state to determine precisely what the salvage title means.
What A Clean Title Looks Like
Clean titles will look different in every state. However, the title will have a spot that explains it is the certificate of vehicle title on the sheet. It will also have information about the car, including the VIN, make, and model.
The color can vary widely, with many states offering two-tone or multicolored titles. The sheet will also state the owner's name, and it will show if there are any liens on the title.
What A Salvage Title Looks Like
A salvage title will look different depending on your state. They will often be a different color from your state's clean titles, usually a much brighter color to indicate the difference. However, not every state changes its color.
The only change that every state will show is adding the term salvage on the title. It will be at the top of the title, or it will be in a box for stamps about the condition of the title.
You will still see the information for the car like the VIN, make and model. In some states, it might be more difficult to tell the two apart. If you're not sure, you may want to look at the vehicle's history with the National Motor Vehicle Title Administration Service.
Car Title Types
There are ten total types of car titles. In some states, there are fewer because many states will roll in all sorts of damage under the salvage title. You can learn about each of the titles to better understand what you can do with your new car.
A clean title means that you can do everything you want with the car. It is entirely road legal and is in good standing with the state as far as condition. You can drive these cars, get loans on them, and sell them whenever you want.
A clean title has the highest resale value because it indicates no known issues with the car. If you want a vehicle that you can buy and drive right away with minimal hassle, a clean title is best for you.
Salvage titles mean that the car has experienced a great deal of damage. Depending on the state, this can be damaged anywhere from 75 to 90 percent of the car's value. Once your car gets a salvage title, you can't drive it on the road without extensive repairs.
A salvage title hurts the price of your car because the person buying it won't be able to use it without getting repairs and reinspection. These can both be very costly. In some states, you can't even sell a salvage car to people without repair certifications.
Though clean and salvage are the two most common titles, you might run into a few other types when buying cars. Here is each of the other eight with a quick breakdown of what they mean.
- Rebuilt Title: These titles indicate that massive repairs have been made to a vehicle to get it road-worthy again. In some states, this may still be referred to as a salvage title.
- Junk Title: In some places, junk and salvage titles are the same. Cars that have received massive damage can earn a junk title. Junk titles are usually not considered to be repairable.
- Bonded Title: Getting a bond title ensures that the car is worth what the owner claims. Bond titles can last from three to five years and get stamped on the original title.
- Lemon Title: This title shows up on cars with persistent issues that make them unsafe. Someone can usually fix them to avoid getting this title.
- Odometer Rollback Title: Issued to cars that have had their odometer changed.
- Dismantled Title: These are titles that mean the care is only helpful as scrap and parts.
- Certification for Destruction: Cars that have been totaled by an insurance company receive this title. You should not drive cars with this title again.
- Flood Water Damage Title: Used for cars that have sustained massive water damage.
Can You Turn a Salvage Title into a Clean Title?
Once your car has a salvage title, you won't be able to get it a clean title again. However, you will be able to get a rebuilt title. In most states, that means that you will have to make all the repairs to the vehicle and then get it inspected by a trained and certified state agent.
Once it passes the inspection, a new title will be issued that explains that the car is safe to drive on the road again. Even after you get it retitled, the vehicle will still sometimes have issues getting insured, loans, and it still usually lowers resale value.
However, you will be able to drive your repaired car and get it registered without a problem. So you can turn the salvage title into something that will work for you if you are willing to put in the time and effort for repairs.
When it comes to clean title vs. salvage title, the real question is how much work you're willing to put into the car after purchase.