What is a Salvage Title?

A Salvage Title is a form of documentation issued by a state’s Department of Motor Vehicles (DMV) for vehicles that have been severely damaged and are considered a total loss by the insurance company. This typically occurs when a vehicle has been in an auto accident, suffered from flood damage, or experienced other catastrophic events, and the repair costs are more than the vehicle’s actual cash value.

When an insurance company declares a vehicle as a total loss, they pay the owner the pre-accident value of the vehicle and then take possession of it. The insurance company may then sell the vehicle to a salvage yard or a business specializing in car repairs or selling used parts. The vehicle’s title is then replaced with a Salvage Title to indicate its status and history of damage.

A Salvage Title serves as a warning to potential buyers about the vehicle’s past and its potential safety issues. It significantly reduces the vehicle’s market value and can make it difficult to insure or finance. Sometimes, a vehicle with a Salvage Title can be repaired and made roadworthy again. If the vehicle passes an inspection by the DMV, it may be issued a Rebuilt or Revived Title, allowing it to be registered and driven on the road again. However, even with a Rebuilt Title, the vehicle’s history of being “totaled” will remain part of its permanent record.