Selling Salvaged Cars Guide
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Selling Salvaged Cars Guide

By Autolist Staff | May 6, 2019

Selling a salvage titled vehicle is a good way to get rid of a junk car while making some money. Salvaged vehicles are vehicles that insurance companies deem too expensive to replace or repair, whether because they've been stolen, vandalized, or damaged by bad weather or accidents. Even though such cars can't be driven with their salvage titles attached, there are many ways to get a salvage title car off your hands in exchange for money.

What Selling Salvaged Cars Entails and How It Works

Salvage title laws vary by state, but the general principle is the same: Once an insurance company determines that a car's total damage exceeds a significant portion of its value — typically 75 to 90 percent — it labels the vehicle a total loss, and the department of motor vehicles (DMV) for the state slaps a salvage title onto the vehicle.

You can't drive a salvage car unless you get a new title for it, and acquiring insurance for such a vehicle is very difficult. Even if you manage to do so, the insurance rates are probably not worth it. Most dealers don't accept salvage cars as trade-ins, even after the salvage title has been removed. Salvage titles sometimes come with special designations for their type of damage, such as hail or flood damage. Cars can also receive a non-repairable designation, which means they're incapable of being repaired and must instead be destroyed or sold for parts. If your wrecked car has successfully been fixed, however, and if it's passed your DMV's safety inspections, it can receive a new title with branding to show it's still roadworthy.

If the car was stolen and had been missing for a month or so, the insurance company may pay off the vehicle and sell it to a salvage buyer, in which case the car may receive a salvage title. Selling a salvage car to an insurance company is one of the quickest ways to make money off it — but not the most lucrative. Typically, the insurance company's settlement is low, so the company can profit from reselling the vehicle to the salvage buyer. As a result, you're better off selling to the end consumer directly.

Newer salvage vehicles tend to sell better than old ones because the drivetrain components are more valuable. Many people also pay extra for niche salvage cars, such as Volkswagen Beetles or Porsches, since they may have a high repair or resale value and lots of rare parts. By contrast, junkers — that is, cars that have been around for more than a few decades — don't have much value. Once you've gone to your local DMV and received a salvage certificate for your car, you can sell the vehicle to a dealership willing to buy salvage vehicles, or you can look for other potential buyers.

Selling to a Salvage Yard

Salvage yards love to buy salvage title cars, as they can scrap these cars for parts and crush them into metal blocks for recycling. If you want to sell your salvage car to a salvage yard, you need to collect your car's title and registration to show the buyer your vehicle is legitimate.

Depending on the yard, you may also need a value appraisal of the car from Kelley Blue Book or the National Automobile Dealers Association, plus a detailed explanation of the car's damage. U-Pull-It salvage yards are a good option if you want to sell your salvage car without going through a go-between. These buyers purchase used cars from people, drain and dismantle them, and then park them together in large yards, where customers can manually collect their parts for a discounted rate. One benefit of U-Pull-It salvage yards is that they care mainly about the weight of the vehicle, so you're not as likely to be penalized if you have an older car. This method is especially lucrative when the metal market is doing well. Unfortunately, U-Pull-It yards don't pay as much for rare or luxury cars, since they only sell parts.

Another option is to sell your salvage title to a full-service salvage yard. In addition to draining and dismantling salvage title cars, full-service yards remove the parts from vehicles themselves. They also clean the parts and give them warranties. If you have a newer or more valuable salvage car, you can earn more by selling it to a full-salvage yard than a U-Pull-It yard, because the full-salvage yard pays extra for high-value parts, which they, in turn, sell to body shops and dealerships. If you have a niche car, try to find a salvage yard specializing in such vehicles, as it might pay you more for your vehicle than a regular yard.

Other Ways to Sell Your Car

If you don't want to sell your salvage title to a salvage yard, there are plenty of alternatives. For example, you can find a private car buyer who's happy to pay you a significant fraction of the car's value, either because they can use the car's parts or because they want the vehicle as a collector's item. Alternatively, you can find a dealer willing to take salvage cars as trade-ins, or you can call a hauler or tow company to buy the car for cheap, and they can sell it to a salvage yard for a profit.

Calling a tow company is a good idea if you don't want to transport your salvage car to a yard and can't find a yard that's willing to pick up the vehicle for you. You can also donate your vehicle to a charity, such as Make-A-Wish or Kars4Kids, for a tax deduction. Another way to get a salvage car off your hands is to bring it to a salvage vehicle auction, where recyclers can bid on your vehicle. To auction off your salvage car, however, you may have to pay auction fees of $250 to $600 (as of 2019) and file some paperwork. You may also need to tow your vehicle to the auction, which can be expensive.

Keep in mind that you don't have to sell your salvage car whole. You can always dismantle the vehicle yourself and sell the parts individually. This method takes time and requires some experience, but it might get more money overall. Finally, you can try to rebrand your car. This method entails fixing the salvage car so it can receive a clean title as "rebuilt" or "reconditioned." For this approach, you need to fix the vehicle or hire a mechanic to do so, taking care to photograph the car throughout the repair process. You can then give the DMV your photos, your bill of sale for the vehicle and your car's salvage title and request a vehicle inspection. If the DMV decides the car is roadworthy after inspecting it, the inspector can give the vehicle a decal authorizing it as such. You can then file for a new title with the DMV. Although this process is expensive, car buyers are apt to pay you more for a rebuilt salvage car. Just make sure you follow state-specific laws when rebranding.

Selling salvaged cars can be a challenge. You may find it hard to determine the true worth of your salvage car, as most car appraisal sites don't evaluate salvage titles. If you pick the right buyer, though, you can turn your car into a nice chunk of change even if it's been totaled. Offer the vehicle to a salvage yard, or sell the vehicle another way, such as by auctioning it off or scrapping it for parts.