Buying a Car with a Salvage Title or Rebuilt Title

Mary Van Keuren
Mary Van Keuren

If you routinely buy your cars off the showroom floor, you may never have encountered an auto with a salvage or rebuilt title. But if you’re interested in saving significantly on a car purchase and are willing to take a risk, a vehicle that has a salvage or rebuilt title may be right for you. 

Rebuilt cars can be found occasionally on used car lots, and you may also find a car with a salvage or rebuilt title if you are buying through a private sale or online. If a car is salvaged or rebuilt, it should be clearly marked as one on its title document.

What is a salvage title or rebuilt title car?

A salvage car is one that has been deemed non-fixable by an insurance company — it’s been totalled. This is probably because it was in a serious accident, but may also have been because it was damaged in another way, such as through flooding or because of a theft. Generally, marking a car as salvage indicates that the damage was enough that it would cost 75-90% of the car’s value to fix it.

The difference between a salvage car vs rebuilt is that the former can not be operated on public roads. A car with a rebuilt title started out as salvage, but was fixed enough to make it road-worthy again. In some states, but not all, rebuilt cars need to undergo a battery of tests to make sure they are in good shape and safe to drive.

Getting Insurance with a salvage car vs rebuilt

Buying a salvage or rebuilt car should cost you less than a comparable car that wasn’t damaged, but you may end up paying more for insurance. Since car insurance is required in almost every state, you’ll need to search around to find a company that will provide coverage.

Because you can’t operate a salvage car on public roads, you will not be able to get any insurance for it. But with a rebuilt car, you may be able to purchase a liability policy that would cover damage to another car or pay for medical costs of the other driver if you were in an accident. However, you will probably not find anyone willing to sell you collision or comprehensive coverage because of the past damage to the car.

Salvage and Rebuilt Title Pros and Cons

The biggest pro for buying a rebuilt title car is cost: you should pay significantly less for one. According to the Kelley Blue Book, a rebuilt car is worth roughly 20-40% less than the standard Blue Book value for an undamaged car of the same kind. If you have access to a good mechanic, or enjoy fixing cars yourself, that may not be a hindrance to you.

The con, of course, is that you may end up getting a car that, even if it’s been rebuilt, still has evidence of damage. It’s impossible to bring a car that’s been in a serious accident back to like-new status — which is why it costs less to buy a rebuilt car in the first place. 

Frequently Asked Questions

How does a car get a salvage or rebuilt title? 

A car is given a salvage title if the insurance company declares it a total loss. This usually occurs when the car is damaged to the point that fixing it would cost within 75-90% of its value. If the damaged car is repaired, it earns a rebuilt title.

How does a salvage title affect my car’s value? 

The Kelley Blue Book states that a car with a salvage title is worth 20-40% less than a similar car without the damage. But it cautions that cars with a salvage title should be individually appraised to determine their market value.

Should you avoid purchasing a car with a rebuilt title? 

Unless you are good at working with cars and are looking for a project to work on, or, have the money for repairs and a good mechanic to do them, you should probably avoid purchasing a car with a rebuilt title. 

About the Authors

Mary Van Keuren

Mary Van Keuren Contributor

Mary Van Keuren has been covering auto and home insurance for for nearly five years, and has published numerous reviews of state-specific insurance trends and how to find the best insurance deals for your money. She earned B.S. and M.A. degrees from Nazareth College in Rochester, N.Y. and has been writing professionally, both in print and online, for 30+ years.