Cars with "Rebuilt" Titles (and comparable)

[DGS49]

Many years ago I had the opportunity to purchase a Mercedes SL550 with a "rebuilt" California title, at a tremendous bargain price. It was low mileage and apparently in perfect condition. The seller was a dealer who dealt exclusively with such cars, and his "story" for this particular car was that it had been stolen, then written off by the insurance company. Once a car is "totaled" by an insurance company, it must be branded with a "rebuilt" title (terminology varies from state to state). He bought it directly from the insurance company. I paid $25k at a time when they were selling for $35-40 grand. I had a third party mechanic come in and inspect the car. I bought it and had no issues relating to title, safety, flaws, or any of that. Actually it was a great car.

My son bought a Subaru Outback a couple years ago under similar circumstances. It was a dealer who handled only rebuilt title cars, fixed up to pass Pennsylvania state inspection. It appeared to be in perfect condition and his two years of ownership have been without incident.

I currently have the hots for a VW Golf Alltrak AWD wagon, with a stick. It is out of state and has a rebuilt title. As with the cars described above, it appears to be in perfect shape. Minnesota requires an "inspection" for cars with rebuilt titles, but it's nothing more than confirming that the ownership is kosher. It has nothing to do with safety or mechanical condition. There are third party companies who will, for a modest fee, do a full inspection of a car, including reading the codes and what not.

Looking from 10,000 feet up, it is easy simply to say, "Don't buy cars with rebuilt titles. Just get a good, inspected used car and be done with it." But if I can save five grand vs comparable vehicles with clean titles, is that enough to justify taking the chance? Assuming you have done your due diligence. As for resale value, that was not really an issue when I sold my 550SL. It didn't even come up, even though it was right there on the CarFax.

I am at least going to talk to the selling dealer and see why this particular car has a rebuilt title. If it seems credible, I will take the next step and get it checked out by the third party inspector.

BTW, Carvana - yes, THAT Carvana - has offered me a stunning amount for my Dodge Journey. It is really much more than I expected.

 

[80zephyr]

I have bought cars and rebuilt them. In my state(Wisconsin), the state police do a very rigorous inspection. Nobody is gonna take a badly damaged car and fix it, because its not worth it. Most damage is cosmetic.

I would not hesitate to ever buy a salvage title car in my state.

 

[sparky]

~S~

 

[Natural Citizen]

It's the flood totaled ones that you have to be mindful of.

Many get shipped out of Florida and onto sales lots in different states.

 

[80zephyr]

It's the flood totaled ones that you have to be mindful of.

Many get shipped out of Florida and onto sales lots in different states.

Ah, yes. Stay far away from them.

 

[odanny]

Buy it. I totaled my VW, hit a deer, airbags did not deploy, they totaled it, I bought it back for $500, and with my payout it was break even to get it looking pre-accident. It was 6-7 years ago, you can't tell it was in accident, other than the paint is coming off the bumper cover.

 

[DGS49]

Yeah, I think the obvious red flag is flood damage, as you never know how badly the electronics were compromised.

Still, if it is checked out with a good scan tool, that might be good enough.

I am now waiting for the dealer to disclose why it is a rebuilt title. I will get a CarFAx to confirm. I will also pay for the third-party inspection if the dealer is game (why wouldn't he be?).

 

[DGS49]

I've gone back and forth with this dealer, and I got a copy of a "report" that basically says, this car was once damaged to the point where the insurance company "totaled" it. Apparently, some States have a percentage value, and if the estimated cost of repair exceeds that percentage of the car's wholesale value, it MUST be declared a total loss. In this case, the owner then sold the car to a company that buys, repairs, and re-sells such vehicles on a wholesale basis. In order to be titled again, the vehicle must pass an inspection or two that is at least as rigorous as the safety inspection that is periodically required for all passenger cars to keep them on the road.

The elephant in the room is that this is a SAFETY inspection, not an inspection for being a functional car. To illustrate, if the car has a motor or transmission or cooling system that are totally fucked up, that would not impact safety and would not be a problem.

I'm looking at another nearly-identical car that is a few thousand more and has a couple of add-ons that I want. Waiting for that dealership to respond to my proposed price.

The car is a 2019 VW Golf Alltrak SE wagon.

 

[Jarlaxle]

I have seen "totaled" cars that were able to be driven with no repairs. I work with a guy whose Ford Escape was "totaled" but the entire list of repairs needed to be functional consisted of a windshield and rear glass. (It was hail damage, 100% cosmetic except the glass.)

 

[odanny]

Maybe you can find a deal on Facebook Marketplace.

 

[DGS49]

I'm moving forward with this purchase. I will deliver my Dodge to Carvana on Monday morning and receive a check. Tomorrow (Friday), the car is being checked out by a tech from Lemon Squad. If the report is positive I will fly to Minneapolis and pick it up.

 

[DGS49]

So the transaction with Carvana was quick and totally painless. I had the check in my hands within five minutes.

I called my insurance broker to tell him about selling the Dodge and my plan to buy the VW. I got a liability insurance card for the VW, which I can tear up if the transaction falls through. I'm headed to Minneapolis on Wednesday to do the deal (or not) and drive it home (or not).

Check this out:

• The bad news is that because the car has a rebuilt title, I cannot get collision or comprehensive insurance on the car;
• The good news is that my insurance premium will be reduced by about a thousand dollars a year;
• The maybe good news is that the Commonwealth of Pennsylvania usually does not issue rebuilt titles to such cars coming in from out of state; they issue a clean title.

So if the title comes back with no impairment, I can get the collision and comprehensive insurance. I am reminded that I bought a M-B several years ago under the same circumstances and my PA title was clean. That one had been totaled because it was stolen and the insurer paid out for it.

The dealer seems like a straight shooter. He shot me an email this afternoon to make sure that I was aware about the title and that the car is a stick shift. That was nice.

 

[DGS49]

Checking back, I've had this VW Alltrack wagon for about 8 months now. When I got it, I took it to my mechanic who specializes in German cars, and he gave it a clean bill of health, with one exception. There were a couple panel gaps (undercarriage, not visible from the outside) that were not completely sealed, and he corrected it at minimal cost.

I have driven the hell out of this wagon, including a trip to Florida and back (4,000 miles in total), with no issues whatsoever. My only downside is that my wife doesn't like driving a stick, so there are occasions when it is necessary for her to drive and she gives me a mild blast of shit, but that's not really with the car.

I suppose the other downside is that I tend to trade cars frequently, and when I go to sell this car I will have to convince prospective new owners that there is nothing to be concerned about.

Parenthetically, Allstate would not give me collision insurance, but I recently changed to LibMutual and they have no problem with it. I now have full coverage - for half of what Allstate was charging me.

 

[DGS49]

I just went to Carvana to see what they would give me for my VW Alltrack wagon (2019, 50k miles, near perfect condition). If you are not familiar, they have a fairly extensive list of questions that they ask you about the car - assuming that you are truthful - but they don't directly ask if it has a rebuilt title. The CarFax indicates two collisions which I disclosed in the questionnaire. But I guess they can get that from DMV records as well.

Their quote to buy my car with cash: $300.00! Similar cars with clean titles are selling across the nation for $20K+. I guess they really don't want the car.