Buying a Car With a Total Loss History But a Clean Title – What to Know

When shopping for a used vehicle, you come across what seems like a great deal – the car looks good and the price is super low. Upon further inspection, you realize the vehicle was previously declared a total loss by an insurance company but now somehow has a clean title. Is this a deal you should jump on or a potential scam you should avoid?

This scenario is more common than you may think. Sometimes vehicles with a branded title indicating total loss damage can illegally have that history erased through a fraudulent process known as “title washing.” As a buyer, it’s critical you understand the risks before purchasing a car that seems to have a total loss past but now has a clean title.

What is Title Washing?

Title washing refers to illegally altering a vehicle’s title to remove any brands that would show past damage, floods, salvage status, or that it was deemed a total loss.

This is done by literally “washing” away the original title brand. Shady sellers will take these steps to make a car with serious issues appear clean on paper so they can sell it for more money.

Some common title washing techniques include:

• Applying for a new title in another state that doesn’t require brands
• Using an alternative VIN number on the application
• Lying on the title application about the vehicle’s history
• Exploiting loopholes in different states’ title rules

No matter the technique, title washing is illegal in all states. It unjustly profits the seller while putting buyers at risk of purchasing an unsafe vehicle.

Dangers of Buying a Title Washed Car

While that “clean title” used car with a suspiciously low price tag may seem enticing, here are some significant risks you take buying a title washed vehicle:

• Overpaying – You’ll likely massively overpay for the car if you think it has a clean history when it was actually a salvage.

• Safety hazards – The car could have serious underlying conditions making it unsafe to drive if repairs weren’t done properly.

• Costly repairs – You may need to sink thousands more into repairs that you didn’t expect with a clean title car.

• Insurability issues – Insurance companies often won’t insure rebuilt/salvage vehicles or will only do so at very high premiums.

• Registration problems – States may refuse to register the car if the true branded history is discovered.

• Resale difficulties – Banks won’t finance purchases of these cars in the future, and you’ll have a near-impossible time selling it.

• Void warranty – Any included warranty will be voided once the washed title is revealed.

Overall, title washing puts innocent buyers in a terrible situation. The car you thought was a deal turns out to be a legal and financial headache.

How to Avoid Title Washed Cars

Now that you know the risks, here are some tips to avoid buying title washed vehicles:

1. Carefully inspect the title

Don’t assume a clean title means a clean history. Closely examine the title for any evidence of tampering. Look at the VIN on the title and make sure it matches the VIN plates on the car itself.

2. Run a vehicle history report

Purchasing a used vehicle history report from Carfax, AutoCheck or VinAudit is a must. It’s the best way to uncover any title brands or total loss history that may have been washed away illegally.

3. Research state title laws

Learn the title branding terminology and processes in the state where the car is being sold. See if there are loopholes sellers exploit to wash titles there.

4. Verify with insurance companies

Many insurers report total losses to databases. Contact major carriers to see if they have any record of that VIN previously being a claimed total loss.

5. Get a pre-purchase inspection

Don’t rely solely on a clean title. Have a trusted mechanic inspect the car top to bottom to catch any signs of major prior damage.

6. Walk away if uncertain

If anything seems off or the seller seems reluctant to provide information, it may be best to walk away rather than risk buying a washed vehicle.

Total Loss Vehicles Can Still Be Good Deals – If Branded Properly

As shady as title washing is, it’s important to note that not all totaled vehicles with rebuilt titles are bad cars or scams. If properly repaired and legally titled with a “rebuilt” or “salvage” brand, they can be fine affordable options.

Some tips for finding a good total loss/rebuilt vehicle:

• Focus your search on newer models – major repairs on an older car are more concerning.

• Only consider those rebuilt very recently – repairs degrade over time.

• Have an inspection done by a specialty shop familiar with rebuilds. They’ll check that repairs were done properly.

• Ask for receipts showing exactly what repairs were performed if possible.

• Research how to title/register a rebuilt vehicle in your state. Make sure you follow each step.

• Get guaranteed quotes in writing from insurers confirming coverage for a rebuilt vehicle before purchase. Understand the costs in advance.

As long as repairs were done correctly and the branded title is legal, a rebuilt vehicle can still be a smart and more affordable option for many buyers. Just take precautions to verify its full history first.

Check That Title Carefully Before Purchase

The bottom line when buying any used vehicle is you must thoroughly research its history and title status before handing over any money. While you may come across tempting deals on cars with salvage histories but clean titles, illegal title washing is sadly common. Protect yourself by taking steps to confirm the true status before purchase. And if anything seems suspicious, it’s best to simply pass on that deal. Carefully vetting titles helps ensure you don’t buy headaches down the road.