Consequences Of A Salvage Title On Vehicle Values

Industry standards followed by and noted in print by the National Automobile Dealers Association (N.A.D.A.) Appraisal Guides, Kelley Blue Book Market Report Official Guide, the International Society of Automotive Appraisers (I.S.A.A. now the I.A.A.A.) and additional automotive business entities within the United States of America, all devalue a motor vehicle that is in possession of a Salvage Title, by 10% - 50% of the normal, fair market retail value of the vehicle without a Salvage Title. The percentage variance increases with the younger age of the vehicle at issue and the retail value of that vehicle. Any vehicle that is more than 10 years old carries at least the 10% minimum devaluation to the fair market value of the vehicle, if not more.

Vehicles that are in possession of a salvage title from a total-theft strip insurance claim, opposed to a physical damage/impact type claim, are usually devalued in a lesser percentage amount from that of a collision or fire loss insurance claim branded salvage title. The percentage of devaluation is decreased by between 10% - 20%, based on the age and normal retail value of the vehicle. A vehicle in possession of a salvage title by reason of a non-collision type loss (theft, vandalism, partial fire or partial water intrusion) is usually devalued to a lesser percentage, than that of a collision type loss vehicle.

If the vehicle is in possession of junk title, the percentage of devaluation for the value increases. This is due to the fact that the vehicle & title was branded junk by either the insurance carrier of record or by a state agency (Department of Motor Vehicles). This type of vehicle was supposed to have been dismantled, not repaired, based on the amount of damage sustained to the vehicle as a direct result of the loss it was involved in. Vehicles with a branded junk title are normally devalued by a percentage of 40% - 60%, depending on the year, make and model and normal retail fair market value.

Once a vehicle is branded with a salvage or junk title of ownership, this type of tarnished history stays with the unit, even if the branded title is "washed clean" in another state to be free of the designation salvage or junk.

The marketability of any type vehicle with a branded title or history, is questionable. This is something to keep in mind, when contemplating the purchase of a vehicle with this condition present.

Researching the history of any vehicle, prior to a contemplated purchase is extremely important!