What does getting an auto salvage title mean to me?
December 31, 2017 10:44 AM   Subscribe

I recently made an appointment with GEICO to get repair on some hail damage (large cracks in windshield, many dings) on my seven-year old Hyundai Accent. After about an hour and a half of assessment, the agent proclaimed that the damage was greater than the value of the car.

He continued that they could pay me X or Y, Y being much more, but I would have to accept a salvage status. Since the car has been meticulously maintained since I bought it new, and the damage is only surface (the window is in no danger of crumbling in suddenly, for instance), I wondered about this. It's been a great car in every way.

How does a salvage title affect trade-in to a dealer (which seriously I've been thinking about, just due to the number of miles--130K--I've put on it) or when selling to a private party, or anything else I need to know about salvage?

Maybe I should just fix the windshield ($100 deductible) and leave the dings.

*GEICO's customer service has always been outstanding, including talking me down off the wall the time I grazed (only hit one; poor thing) a herd of deer.
posted by intrepid_simpleton to Travel & Transportation around Nebraska (7 answers total)
In most jurisdicdtions, having a salvage title on a vehicle prevents you from getting comprehensive coverage, and limits you to liability only insurance. So later, if your car gets totaled, you won't get replacement value for it.

Salvage titles have a dramatic decrease in value. In part because the buyer doesn't necessarily know exactly why the car has a salvage title. Was it completely obliterated and then reassembled with parts from three other cars, and as they say, a polished turd? Or did you get hail damage and it inadvertently got 'totaled.' This decrease in value translates to dealers too, there's precious few (if any) ways to un-brand a title from salvage to not.

In a case like this, I would fix the windshield, leave the dings, and trade it in if that's what your plan was originally. Avoiding a salvage title is a legitimate reason to bypass your insurance company for repairs.
posted by furnace.heart at 11:00 AM on December 31, 2017

With a salvage title, you will not be trading it into the dealer or at least the dealer will have zero interest in selling your car. They would send it off to an auction or some smaller dealer that specializes in that sort of thing will buy it. They'll give you something like $1,000-$1,500 for it and probably not anything more than that. You and I know that the damage is cosmetic but it won't matter to anyone else.

OTOH, you've got a seven year old sub-compact with close to 100,000 miles on it. Even in really good condition the trade in value would be something like $2,500 or so. It's old enough that even without the hail damage, I'd just keep driving it until the wheels fell off. The salvage title isn't going to bother you so I'd probably make that claim, have the windshield and maybe some of the worst dents fixed and pocket the rest as long as it doesn't affect anything else about the situation.

The car works just fine and it'll cost you a lot more to replace it with anything else. The longer you soldier on with this ride, the nicer the car will be that replaces it.
posted by VTX at 11:14 AM on December 31, 2017 [3 favorites]

About the only dealers who might give you anything for a car with a salvage title will be the grungy street-corner lots. And, even those might take a pass. You might be able to get someone to bite if you put it up on Craigslist, but, even then, it's a crapshoot. You definitely won't get a good price for it.

If the car is in good working order and only has cosmetic damage (and, it sounds like that's the case) I agree with furnace.heart. Replace the windshield and keep driving it.
posted by Thorzdad at 11:14 AM on December 31, 2017 [2 favorites]

I will follow on what VTX noted:

It would be one thing if this were a hail-damaged 3 year old BMW. But it's an old Hyundai with a bunch of miles. I don't know where you live, but I played with bluebook things for a minute and they suggested that a trade-in value for a 130000 mile 2010 Accent with dings all over it is in the ballpark of $1000 around here. Just for the metal, the car is probably worth $250-400, and it's hard for me to imagine the junkyard will care about a salvage title for a car they're going to crush.

What this says to me is that you might as well take the higher offer of $Y, accept the salvage title, and just keep on driving it into the ground. Yeah, it'll be worth less, but it won't be worth less than the scrap value in any case, and it wouldn't be worth much more than the scrap value even if you take $X and avoid the salvage title.

Just to note that if you end up talking to dealers about new cars, you might want to hang on to it and not just take it straight to a junkyard-- one time when we were doing this, the trade-in ended up being several thousand more than what they'd said because the promotional financing required the car to be sold for sticker and they'd moved what we'd negotiated down onto the trade-in value. Which was likewise minimal because it was a 14 year old Prelude with around 200,000 miles and a big dent. Anyway, even if they're just going to scrap it it might be handy to play money games, is all.
posted by GCU Sweet and Full of Grace at 11:41 AM on December 31, 2017 [5 favorites]

the damage was greater than the value of the car

Does this mean its totalled? If it’s totalled take the money and buy a similar car with less miles. Even if you have to take out a loan of a couple thousand dollars you’ll still have a newer model of your same car. Of course have a mechanic check out the car to ensure that it’s in good shape.
posted by bendy at 2:23 AM on January 1, 2018

My parents bought my first car when I was 15... The week before my 16th birthday, we had a massive hail storm. They bought the car from friends for $2500 and the insurance company offered $6000 for it. We bought the car back for a $2500 (not sure how they calculate the buyback value) with a salvage title and I drove that car for almost five years. When it came time to buy a new car, I had a nice down payment tucked away (for A 21-year old kid, at least).

I didn't mind driving on a salvage title, but my car definitely had flavor - hundreds of hail dings. If you don't mind driving a car with cosmetic damage, take the money, buy the car back for cheap, and save the money for your next big vehicle purchase.
posted by honeybee413 at 2:47 AM on January 1, 2018

I knew two brothers who ran their own garage. They regularly bought salvage vehicles at auction that had been "totaled" by adjusters. They put them in good working, if not cosmetic condition and personally stood behind their work. The only problem I ever had with the salvaged vehicles I bought from them was having to front considerably more cash on the loans...
posted by jim in austin at 5:06 AM on January 1, 2018

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