The Money Mustache Community
Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: MichaelB on July 20, 2016, 08:50:07 AM
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My wife and I are probably going to need one soonish (next year, year and a half--both our cars are reliable, but each at about 150k miles). I was looking at Craigslist earlier for kicks and giggles, and there are a lot of salvage titles there. Does anyone have any tips/advice/experience for buying a car with a salvage title? Anything in particular I should look for? Or should I just avoid them altogether? Tips are much appreciated.
Also--yes, I am thinking (although my wife probably not so much) of how we could potentially try being a one car household.
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Check out some previous discussion on the forum: http://forum.mrmoneymustache.com/ask-a-mustachian/would-you-buy-a-salvage-title-vehicle/
There are also some other threads about this too, but the one I linked had some particularly good info IMHO.
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Figure out why it's got a salvage title.
If it's because it's older, cheaper, and has obviously hit a deer, go for it.
If you can't figure out why it has a salvage title, stay away.
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Check out some previous discussion on the forum: http://forum.mrmoneymustache.com/ask-a-mustachian/would-you-buy-a-salvage-title-vehicle/
There are also some other threads about this too, but the one I linked had some particularly good info IMHO.
Ha! Thanks. I laugh because I've asked about a few things before, and each time the answer is just a link to another FI/RE website, or another thread. At this point I should just assume that every question I have has been asked answered multiple times here.
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Only buy a salvage car from someone you personally trust.
And only when you accept that you can never sell the car.
It's easy for anyone of questionable motives to give you a nice story of why/how it was totaled, and how it was professionally repaired, but they can also tell you stories of car fairies and 100 mpg carburetors they built.
There are so many on craigslist because of point two above. Many buyers follow point 1.
That you are asking here (strangers with no verifiable credentials) leads me to think you should stay away from them.
That said; my first car was a salvage title. My dad bought it from a guy he worked with. The guy hit something that took out the grill, radiator and a fender.
My dad was a professional mechanic when he was younger. He bought the car as-is and my brother and I helped him repair it. I still remember the MANY measurements we took as dad did the front end alignment - which was the last part of fixing it. I now fully understand camber, caster, toe-in and toe-out.
Mom and dad drove it for a few years. My older bro drove it a bit.
When Dad found out he couldn't sell it (for what he 'knew' it was worth) he sold it to me.
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Only buy a salvage car from someone you personally trust.
And only when you accept that you can never sell the car.
Or just buy cheap enough that it will sell anyway. I've owned a bunch of sub-$1000 salvage title cars and haven't had any issues selling them.
It's easy for anyone of questionable motives to give you a nice story of why/how it was totaled, and how it was professionally repaired, but they can also tell you stories of car fairies and 100 mpg carburetors they built.
Right. :) Hence my suggestion that if it's not obvious why it's a salvage title, walk away. If it's still dented up and has deer hair in the radiator, it's pretty obvious what happened.
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Years ago we bought a salvaged 4Runner (from the Little Nickel paper if you know what that is). It was built from 3 wrecked carcasses by a guy who built it just for fun. We bought it at the time for $7200. 3 years later we sold it to a consignment place who dolled it up with UGLY pinstriping, bug guard etc. We got $8500 out of it. Go Figure.
It was sooo grossly overly decorated that when we saw it in town we would cringe. I am so surprised that 1. we sold it and 2. it sold for that much.
I still don't know what possessed us to buy it. I think it was our gut feeling that it would work out and it did.
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I've always had salvaged cars,until my current one. To be honest, I have had numerous issues with my salvaged vehicles over the years. Not trying to dissuade you, but I wouldn't buy another due to constant problems. There's a reason they were totaled, I've found. If you just want a true beater, I think it would be ok. If you're looking for a decent car, I'd pass.
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My parents got a pretty nice car for under 3k. Their mechanic looked it over pretty good. It's been about a year, no issues yet. I will probably look at salvage titles the next time I need a car.
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If you buy a salvage title you will have great difficulties selling the car. You may not care if you are planning to keep the car forever, but if you are wouldn't you rather but something you know is reliable. Knowing what I now know I wouldn't do it again... I haven't had any mechanical issues per se, but the fuel economy is dismal (significantly worse than for the base model, as it was made sporty as part of the rebuild) and now I can't sell it in order to get something more economical. If I drove more I would probably just bite the bullet and sell it for a song, but for how little I drive, I just have to accept a nice but inefficient car.
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If you buy a salvage title you will have great difficulties selling the car. You may not care if you are planning to keep the car forever, but if you are wouldn't you rather but something you know is reliable. Knowing what I now know I wouldn't do it again... I haven't had any mechanical issues per se, but the fuel economy is dismal (significantly worse than for the base model, as it was made sporty as part of the rebuild) and now I can't sell it in order to get something more economical. If I drove more I would probably just bite the bullet and sell it for a song, but for how little I drive, I just have to accept a nice but inefficient car.
That's correct, most banks won't issue loans for salvage vehicles I believe, so they're harder to sell. The buyer may be able to get a personal loan though.
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In terms of difficulty selling - that factor is totally irrelevant with certain types of car value, i.e. a 5-10 year old car that you plan to drive for several more years. A mustachian car driver will generally have $500-$10,000 (at most) of value left in their car when they're through with it, not like 40k.
SO - if a salvage title is worth even LESS because it's salvage, the street value of your car is probably going to be $500-$2000 once you're through with it. At that point you are either scrapping the car or getting cash through craigslist. Thus back to my conclusion - difficulty with financing a salvage will not be a factor at that point, as you go to sell it.
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If you do decide to get a salvage title, make sure you do what is necessary to get it moved into a legal to drive status. In Texas, if someone drives a vehicle that has only a pink/salvage title, they run the risk of arrest for a class B misdemeanor (6 months in jail and a $2000 fine).
Your earning potential drops significantly if you are behind bars. But then again, no need to pay rent!