Yahoo Autos Why You Don't Want to Buy a Rebuilt Salvage Vehicle
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Ever been tempted to buy a Rebuilt Salvage vehicle? Formerly wrecked but now legal to drive, the former salvage vehicle might be substantially less expensive than another similar vehicle without that designation. I would caution you: Rebuilt salvage vehicles are the fool’s gold of the automotive world.
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To get the big picture on this, I spoke to a Michigan State Police Trooper who often inspects salvaged vehicles and certifies them to get their “Rebuilt Salvage” designation.
In Michigan, if an insurance company deals with a “distressed”vehicle, it will be designated as salvage if the cost to repair it falls between 75% and 90% of its pre-damage value. More than 90% is considered unsalvageable. If less than 75%, it’s a fixer-upper. Most states follow a system like this but those percentages vary from state to state. Find out what it is in your state – your government website should have the info – before you consider dabbling in salvage or rebuilt salvage vehicles.
A typical salvage vehicle is one that was in a severe accident, suffered heavy flood damage, or was stolen and stripped. Suppose your late model Bimmer gets T-boned and you live to walk away from it. The insurance company deems it unfixable and quickly pays you a fair settlement.
Ha ha! I’m kidding of course. Instead, they will lowball you and see how long you will haggle with them before they finally give you just enough money so you won’t sue them. Then they cut you a check and take possession of your pile of German-born scrap.
They sell the wreck at auction and the new owner will get a Certificate of Title prominently branded “SALVAGE.” The Michigan Salvage title is orange. Normal titles in Michigan are green, so this is the first hint that this vehicle has issues, in case you are a lazy reader and didn’t notice the Salvage designation. (i.e., the Title is tl;dr.)
A salvage vehicle is not eligible for a registration and cannot be legally driven in Michigan, even if it is drivable. For example, suppose a car flooded and was deemed a salvage. After sitting around for a few weeks it dries out and the primary damage is a swampy interior, a ruined finish, and a trunk full of dead carp. If the car was drivable, it still cannot be registered. To get a salvage vehicle legal to drive, it must be certified as “Rebuilt Salvage” by a state authority. In Michigan, that person would be a specially-trained law enforcement officer, often a Michigan State Police Trooper. I spoke with one such person, Trooper Seth Swanson, who answered my questions and explained to me how this all works.
First, you buy a salvage vehicle and do what needs to be done to rebuild it. Replace missing or damaged parts. Straighten the metal which can be fixed, maybe unbend the frame a bit. Replace broken window glass. When you consider the car fixed, you call an inspector like Trooper Swanson and arrange for the car to be inspected. The fee is $100. You bring the car to the appointment (but don’t drive it there) and Swanson spends an hour or two looking it over.
Swanson inspects your paperwork. You must fill out a form (TR-13A) which lists the parts which have been replaced and repaired. Replaced parts must be accompanied by paperwork proving where the parts came from and when they were acquired. The entity which did the repairs must also be disclosed. Swanson will review the paperwork and the car to make sure everything is legit. He will also ask to see the receipts for the parts which were put onto the vehicle. If parts bear VINs, he will check those out as well. Don’t be surprised to see him climb under the car to look at a VIN. What is he looking for?
“I’m not there to see if the car is safe to drive. All I’m doing, basically, is facilitating an inspection that shows that the parts that are on it aren’t stolen.”
The car is not inspected for roadworthiness, rebuild quality, or to see if it is “back to normal.” The inspector is looking at the car to confirm that it is complete (for the most part) and that none of the parts on it – which can be traced – are stolen. And as for completeness, the inspector is looking at the obvious stuff: all of the windows, body panels and then some basic systems like headlights, tail and brake lights, horn, windshield wipers and the exhaust.
