From Clean Title to Salvage: How a Vehicle's Status Can Change Overnight

Overview: Explore a real-world example of how a vehicle with a clean title can end up as a salvage title, even without a direct accident or insurance claim.

Key Points:

• What is a Salvage Title?
  • Salvage titles can be created in several ways, not just through insurance claims.
  • Insurance companies, owners, or manufacturers can designate a vehicle as salvage.
• Case Example: Tesla Purchase
  • A person bought a Tesla with a clean title, but later discovered it was actually a salvage.
  • The previous owner had repaired the vehicle themselves after an accident but didn't involve insurance, leaving the title clean.
  • The vehicle was later inspected by the Tesla dealership, which found damage to the frame and battery, leading to the salvage title designation.
• How Salvage Titles Are Created:
  • Insurance Claim: Insurance company pays out a claim and marks the vehicle as salvage.
  • Owner Repairs: An owner repairs the vehicle and may choose to mark it as salvage to protect themselves when selling.
  • Manufacturer Detection: The manufacturer may detect damage upon inspection and mark the vehicle as salvage.
• Why Carfax Isn’t Always Reliable:
  • Even though the buyer checked Carfax, it may not always have complete information.
  • Carfax only tracks vehicles if an insurance claim is filed. It won’t catch repairs made by the owner or manufacturers.
  • It’s crucial to do thorough inspections, especially for electric vehicles like Teslas, which may have unseen damage (e.g., to the frame or battery).
• Tips for Buyers:
  • Always do a physical inspection, especially for electric vehicles, to look for any signs of damage.
  • Consider battery tests and frame checks to ensure there is no hidden damage.
  • Be aware that Carfax records may not reflect all details, and do not solely rely on it when purchasing a vehicle.

Additional Resources:

• For further advice, you can book a one-on-one consultation with experts at actualhum.com for personalized guidance on your situation.

Conclusion: When purchasing a vehicle, be diligent and thorough in checking the vehicle’s history and physical condition to avoid surprises down the road.

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So, how can a clean title go to a salvage if you have no accident? Here's a great example of how a title record may not be 100% accurate. This is a person who purchased a Tesla with a clean title and then, after they purchased it, they found out that it's a salvage and it's going to cost $12,000 to fix it. Here's how this happened.

The way that a salvage title can be created isn't just one method. It can be created either by the insurance company, who pays a claim on a vehicle that says, "We paid out this much money to have this vehicle fixed, so now it's a salvage." Another way to do it is if the owner of the vehicle fixes the car themselves and says, "I fixed this damage and I want to make it a salvage to protect their liability if they sell it." Another way is if the damage is detected by the factory, the manufacturer, and then they put it on the record. That's what happened with this Tesla.

What happened was this Tesla was damaged in an accident. The owner of the vehicle at the time fixed it themselves. They didn't want to go through their insurance. They didn't want to put it on the title. They fixed it and then they sold it to a third party.

Once that third party purchased the vehicle, they brought it to the Tesla dealership to have some repairs done. The manufacturer was able to determine that the car had been previously damaged both from the diagnostics on the vehicle. The computer said there was an impact, there was deceleration, and then also they did an inspection and they found that the frame had been dented, the battery had been damaged. So, the Tesla dealership put a salvage on it. This is completely legal. The salvage designation does not have to come from an insurance company. It can come from any method.

This is why it's very important when you're purchasing a vehicle, not only to check the title record. In this case, the buyer checked Carfax. Now, keep in mind, even if the car had been filed through an insurance company, Carfax doesn't catch everything. Carfax is not 100% accurate. It'll even say in their disclaimer that the records aren't 100%. So, you may have Carfax records that are not complete, but the only way they do get it at all is if it goes through an insurance company. They're not going to pick it up if the owner did it or if the manufacturer did it.

So, be very diligent, especially on these electric vehicles, to check out the frame, check out the underneath, check out the battery, do a battery test, but also to make sure that the physical examination doesn't indicate there was damage, even if this title doesn't show salvage on it.

If you like this video, be sure to click on a few others on our channel to see if there's other information that might be helpful to you about this same subject or maybe even other related subjects that could assist you with your resolution of your issue.