Should You Buy a Car with a Rebuilt Title? What You Need to Know

Understanding the Risks and Realities of Rebuilt Title Vehicles

When shopping for a used car, you may come across vehicles with a "rebuilt title." While the price might seem like a great deal, there’s more to the story than meets the eye. A rebuilt title means the vehicle was once deemed a total loss by an insurance company and later repaired to get back on the road. But is it worth the risk?

Let’s dive into the details, including the hidden challenges, financial implications, and the critical steps to take if you’re considering buying one.

What is a Rebuilt Title Worth?

• Trade-In Value: A rebuilt title vehicle is worth approximately 50% of its market value when traded in compared to a clean title car.
• Retail Value: The same applies if you’re selling it privately—buyers will expect a significant discount.

This drastic drop in value reflects the risks associated with these cars, which brings us to the next issue.

The Challenges of Owning a Rebuilt Title Vehicle

• Hard to Insure: Many insurance companies are reluctant to fully cover rebuilt vehicles, offering only liability insurance in most cases. Comprehensive or collision coverage is rare and costly.
• Difficult to Finance: Banks and lenders are hesitant to approve loans for rebuilt title cars due to their lower resale value and higher risk. Expect to pay cash upfront or face very limited financing options.
• Transparency Issues: It’s common for sellers to downplay the severity of the damage. Phrases like, “It was just a bumper,” or “Only a door was replaced,” can often hide more serious problems.

Google the VIN

Before buying a rebuilt title car, always Google the VIN. Many auction sites, like Copart, IAA, and others, host photos of vehicles sold as salvage. These pictures provide insight into the original damage and the extent of repairs. Companies like PLC Group also offer tools that bring up damage photos, giving you a clear idea of what the vehicle has been through. This step is essential to avoid being misled by a seller.

Safety: A Non-Negotiable Factor

Safety should always come first when purchasing a vehicle, especially if it’s for a teenager or an inexperienced driver. If a rebuilt title car has undetected frame or structural damage, it could pose a deadly hazard in a collision. Parents often buy these cars for their teenage sons and daughters, but it’s vital to consider the risks.

Teen drivers are statistically at a higher risk of being involved in an accident. Sacrificing safety for cost savings could have catastrophic consequences. Always ensure the vehicle has been thoroughly inspected and meets all safety standards before making a purchase decision.

5 Things to Inspect Before Buying a Rebuilt Title Car

• Airbags: Ensure the airbags were properly replaced and are fully functional. Airbag replacements are often skipped during repairs to save money.
• Frame: Check for frame damage or improper repairs. A compromised frame affects safety and vehicle longevity.
• Electrical Systems: Inspect for proper wiring, especially in areas affected by the accident. Poor electrical repairs can cause long-term headaches.
• Accessories: Verify that all accessories, like headlights, taillights, and sensors, are genuine and properly installed.
• Paint Quality: Look for mismatched paint or poor-quality finishes that may indicate rushed repairs.
• Alignment: Ensure the vehicle drives straight and the suspension is in good shape. Misalignment can signal deeper structural issues.

Always Get a Pre-Purchase Inspection (PPI)

Never skip a professional pre-purchase inspection when considering a rebuilt title vehicle. A mechanic experienced in inspecting rebuilt cars can identify hidden problems and give you a clear picture of the car’s condition.

The Bottom Line

While rebuilt title cars can save you money upfront, they come with significant risks. Between insurance challenges, financing hurdles, and the potential for hidden issues, the savings may not be worth the hassle. If you do choose to buy one, arm yourself with knowledge, inspect the car thoroughly, and always seek professional advice before signing the dotted line.

When in doubt, it’s better to spend a little more for peace of mind and a clean title. After all, buying a car shouldn’t have to suck™.