By on February 12, 2014

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When I peruse the websites of some of my local yards, it seems like some of these cars have very little damage but some insurance adjuster has written them off based on whatever metric the company uses.

I’m an experienced shadetree mechanic and it seems like getting a 3-4 year old car for 30% of its original MSRP would be a screaming deal, and since warranty coverage is no longer an issue, it comes down to diminished value on the salvage title. I tend to keep my cars for 8-10 years so who cares.

Here’s where my doubts creep in.

If it was such a great idea, I would have surely read more about it. In the case of this one nearby yard,  they have a huge collision repair facility. So why aren’t they repairing and flipping these cars? Googling doesn’t provide a whole lot on the pros and cons, just on the procedural aspects.

Any experience or stories ?

Steve Says:

Plenty of them.

This past storm through Atlanta recently totaled two of my financed vehicles, and late last year, I had two others that succumbed to the laws of physics.

The best way I can answer your answer is by working backwards by starting with older salvage vehicles first.

If you are looking for the best deal on a salvage vehicle in terms of daily transportation, it’s going to typically be the older, unloved, unpopular vehicle that merely has cosmetic damage.

A 10 year old Saturn with the rear bumper bashed in.

The older SAAB that was well kept, but was hit in that precise point on the front quarter that would require the removal and repainting of the hood, front bumper, and quarter panel if it were brought up to spec.

There are a lot of used cars that are totaled which fit this description. Minivans that don’t have good leather seats or automatic doors. Sitckshifts in non-sporty vehicles. Unloved older SUV’s, orphaned brands, and of course, station wagons.

The exact same types of vehicles that are unpopular and obscure to the non-enthusiast, are those that can provide the best bang for the buck for the shadetree frugalist who wants to explorer the salvage side of the business.

You have to still do all the homework you regularly do when buying a clean title vehicle. It is essential to go and inspect the vehicle in person and figure out the history. Even with doing all that, the buyer fees will negate much of the advantage you supposedly may have.

Plus, there is that one annoying fact with salvage vehicles. They can often have hidden surprises.

If you are serious about doing this, make sure you have easy access to a spare inoperable car that can be used as a reasonably cheap source for parts.

As for the late model vehicle? Don’t even try. The most popular ones are often shipped overseas where the local markets offer a far greater tolerance for substandard repairs, and where the labor rates are a small fraction of those in the United States.

The price of used cars is also far higher in the majority of countries outside the United States. We are known as a “high-content” market which means that many models that appear to have low to mid-level features are considered loaded vehicles in those overseas markets. The exporters can often buy higher than most others, with a few experienced rebuilders who have the resources and know-how to turn over higher end inventory.

My advice to you is to start small. Heck, you can take two unpopular Craigslist vehicles and make them into one with parts to spare. Or just visit a nearby used car dealership or title pawn company and tell them that you would be interested in buying their inop vehicles.

Specialize in a type of car and who knows? You may find yourself profiting from experience. Just don’t expect a $2000 lick every time you sell a salvage car. The market demand will likely be limited to hardcore enthusiasts and frugalists.

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57 Comments on “New or Used? : Should I Salvage My Shady Tree?...”


  • avatar
    scottiedog

    Spot on response. I do the same thing with IAAI vehicles, anything that’s over 10 years old can be had for a steal imho. My last one was a Volvo V70 T5 from 2001 with the 5 speed, had 140k on the clock and a damaged fender plus headlight, $900 including all fee’s and delivery! I work on the assumption that it must have been running and driving at the time to get into a crash, so it can’t be that bad, right? Its always a risk, but for the numbers involved, its not too bad. Plus if it gives an estimated repair, you can always knock off $3.5k for the paint job and aftermarket panels are much better fit than they used to be.

  • avatar
    windsormarxist

    I’ve done this many times on ‘almost classics’. My ’79 Volvo 245 was in 2 bumper bashers (other party’s fault), and both times I refused the kind offer by my insurer to have it taken to their repair shop and be given a rental gratis, as I knew that I’d never get it back. Both times, I just got the parts from specialists and either did the repair myself or had a friendly bodyshop do it, removing a bit of rust at the same time and then AFTER it was completed, I sent the invoices to the other party’s insurer and said either pay these or I’ll sue. Alot of headache, but it was the only way to avoid a write-off on an otherwise immaculate car.

    Case in point was a very nice 29,000 mile Yugo I purchased here in the UK for £200. The only damage was a parking scrape to the door. It was written off category 3, and nobody would touch it. For the princely sum of £10 for a genuine NOS Yugo door and £15 for a litre of black nitrocellulose paint and primer, you couldn’t tell a difference.

    This is the case for any older car. The book value for anything over 15 years old is basically £500, so if you can’t get it fixed for that its scrapped. The best buys are cars like my Volvo that might be for sale- cars with obvious small damage that the owner didn’t report to the insurer to save it. You can also find some really interesting classics in scrap yards for the same money. These are often in far better condition than what you’d find otherwise for sale. Most people know they’re going to sell their car and stop spending money on it for months or years before, leaving you with expensive repairs. A car that’s been written off may have been loved up to the day it was bumped, meaning that in many cases, that bump is the only work that you have to do. Cars like Beetles, Moggy Minors, and anything with bolt-on panels are the ones to go for. However there are cars to run away from no matter how good they look- a ’58 Buick Limited with immaculate steel but front bumper and grille damage would probably cost more than your house to repair so is best avoided. I’ve recently learned the hard way that sourcing rare brightwork and having it repaired/rechromed is far more expensive than body restoration and paint costs on anything that has lots of bling.

  • avatar
    davefromcalgary

    This is an awesome topic. For the record, I am all for this.

    My first car, (second vehicle), was a 1998 Grand Am 2-door, 2.4 Twin Cam, 5 speed. Bought it written off for I think 1500 bucks, in 2002. So, a 4 year old car was bought for not very much. It was a front end collision, which blew the bags, which is why it was written. At the time, we simply removed the passenger air bag, and closed the hatch, and then had the steering wheel plastic welded shut. It didn’t need airbags to pass a safety (I cant say I would do this again, given airbags are a huge part of modern safety systems, but back then, we weren’t bothered by it). I think we spent another 1500 on having the frame inspected, and a little tug. Found a full rad cradle at a wrecker, had the frame shop weld it in. New aftermarket hood, new aftermarket bumper cover and foam, painted off the car. My dad and I did all the tear down and reassembly (I was 17). All told, I was into a 4 year old car for 5 grand, and it was a very cool car for my last year of high school (imo anyways). Drove the car till well over 300,000 kms (from 150,000) with little issue.

    Based on experience, my dad and I bought another Grand Am, a 97 V6 4 door, and fixed it up for my brother. It had rolled, so we found a good roof at a wrecker and had the same frame shop graft it on, inspect and give us proper paperwork. The rest of the car required little to no love to be good to drive. Same repair procedure, lots of sweat equity, we did well on that one.

    Bought a third Grand Am, one that my cousin wrote off. This one was also a front ender, and the repairs were similar to above. The only issue we had with this one was, it was kind of an unpopular wheel/color/option load, and this one we wanted to sell. My dad (unhappily) daily drove it for quite a while till it sold, but given how much we were into it, he didn’t lose money. He has always driven LeSabres, 88s, etc, which is why he didn’t enjoy the Grand Am, too small.

    Lastly, my current 2002 Alero, I bought at the end of 09 with 142,000 kms. It had a rebuilt title. The two gents who sold it two me were retired, and opened a shop. They buy 6-10 cars at a time from auction, some they fix, the rest are donors. When I met them, they were doing Grand Ams and Alero, then they moved on to Cobalt/G5, and then I think Terrain/Equinox. Because of my own experience with rebuilt cars, I know the amount of inspection required to make them roadworthy, so I had no qualms about buying a rebuilt title. It now has 295,000 kms and, while tis pretty much used up, it has given me 4+ years (150,000 kms) of very solid service. The only issue it being rebuilt has ever caused, some crappy-ish paint on the front bumper. I think the one they used, they didn’t prep properly and the new paint did not adhere very well. But over all it has been an excellent car.

    • 0 avatar
      CoreyDL

      Oh, and a point to make on this. In the US at least, certain states have much more stringent qualifications to get it back to rebuilt status. For example, Michigan is much more stringent than Georgia. My car was certified rebuilt in Michigan, and I took some comfort from that.

  • avatar
    CoreyDL

    I did this just recently, and I’ve been very happy with my results so far. Got a 4 year old car with 52k miles, 28% of the original price.

    Do your research by getting the VIN# and searching “[VIN#] salvage.” I found the insurance photos from my car, matching the ones I got from my seller. Just need to make sure it wasn’t anything that got into the frame. For example, a rather light sideswipe which totaled the car.

    If you do enough research and know what you’re doing, find a reputable seller, as well as plan to keep the car a while (as I do), then I wouldn’t be worried.

  • avatar
    AlfaRomasochist

    My DD is a Mazda B2300 that I bought with a salvage title. It had been hit in the left rear; the seller bought it from the insurance auction and sent it directly to have some cheap and cheerful body work done. When it came back he realized he was in over his head; the truck looked OK but it drove like crap – check engine light was on, rear lights were hosed, and it bounced down the road so badly due to bent axle flanges that the rear wheels would actually leave the ground at a high enough speed!

    I bought it for a song, replaced the rear axles / bearings / seals / brakes, sorted the wiring (the CEL was a disconnected electrical fitting in the vapor recovery system), and took care of some deferred maintenance. It’s been 2 years now without a lick of trouble.

    It worked out because I can do a lot of crap like that myself, and I knew what I was getting into. It also helped that the front end was never hit. I shy away from anything that’s been smacked in the mouth too hard, since there’s WAY more stuff up front to break / bend / tweak. It’s almost impossible to set it right.

  • avatar
    davefromcalgary

    VIN#??

  • avatar
    CoreyDL

    I just realized the crashed car photo is an old Forester with the sometimes-seen Infiniti grille replacement.

  • avatar
    NormSV650

    I picked up a 2004 GTO that was repainted after hail damage totaled it. The owner fixed it up with only a few flaws when close up. I had planned on putting a twin turbo kit from UPP for more than half of what I paid for the car. Less than $15,000 later and 700 horsepower it’ll be a fun toy to run sport bikes with well setting in cool comfort of AC. Not much can pass that performance for the buck. It’ll my fourth salvaged title car but with the 30K miles annually it is only cheap way to have fun.

  • avatar
    28-Cars-Later

    Good topic. I’ve personally never purchased a car to “rebuild” primarily because many of the dealers who advertise for these around here want quite a bit for them.

  • avatar
    danio3834

    I’ve done this several times and it can be a tough gig. You have to be very careful with your estimates up front so you account for EVERYTHING (and then some) that the car will need, and get it for a price that accounts for that, plus whatever margin you plan to make. If you plan correctly, where you will make your money is in the labor you save by doing the work yourself.

    If you plan on selling your repaired salvage-title car, I highly recommend keeping a picture log of the car before, during and after the work to show any prospective buyers what was repaired and that it was done correctly. The diminished value of salvage titles is rooted in the uncertainty of the damage and repairs. The more you can do to assure a buyer the car is as good as new, the more you’ll get for it.

  • avatar
    Ron B.

    The problem with buying writeoffs is that most cars today cannot be repaired. There is a reason for this…the bodyshells are designed to fold in a way that allows the passengers to escape injury. Crumple zones aside, the rocker sections have been designed to fold progressively in a collision and are made from steel which doesn’t allow patches to be simply welded in as was possible in the past. If a car has been straightened out after a T bone or sideswipe ,the entire structure is now compromised and all insurance companies worry that a collision in future could see the car fold completely and injure the passengers .
    So what may look like a simple “remove the bent rocker,weld in a new one after straightening the floor and/or door pillars ” is no longer possible.
    I have seen plenty of newer cars such as Mazda 3′s written off because of the most simple damage such as backing out with a door open and catching it on the garage door.

  • avatar
    Stovebolt

    I usually say my first car was a 58 Biscayne, but that’s not quite true. My first car was actually bought from a wrecking yard. It was a Renault Dauphine (sacre bleu!!), maybe a 1961. It looked great to my 14 year old, brain, and I couldn’t imagine how it could possibly be in a junkyard. Bought it and had it delivered. Well, I learned how. The “frame” was rusted through behind the front wheel, so the front suspension clunked back and forth about 6 inches. A leaking master cylinder could only be replaced by cutting through the front trunk. My Princess made innumerable trips around a small field behind the house until swing axles groaned in the ruts. (Ralph Nader was still wringing his hands in law school.) No muffler, no matter, until the crackling exhaust led to a diagnosis of burned valves. The engine sat on blocks in the cellar as parts were removed, valves seated (turned by hand), and all returned to original-or maybe 180 degrees from original. Despite nightly cranking with a battery carried down from my father’s car, the engine never ran again. When the junkyard came and winched the Renault onto a flatbed some months later, it broke in two. My first real car was a Chevrolet.

  • avatar
    DC Bruce

    Aren’t their issues with getting insurance on these cars? I’ve heard this, but don’t know if it’s true.

    • 0 avatar
      davefromcalgary

      In Manitoba and Alberta, which is where my experience lies, as long as you have a mechanical safety and a structural integrity from certified shops, insurance is no issue.

    • 0 avatar
      Lt.BrunoStachel

      Why would it?

      Everytime I have taken out a new policy for what ever car I have bought all the ins.co wants is my vitals and the VIN. No where does it say they won’t insure salvage titles.And they rarely do an inspection of the vehicle itself. They only time the ins.co have requisted an inspection is when I took out an agreed to value policy on one of my “collector” cars. The only issue keeping them from issuing me a policy would be if I didn’t have a valid DL, I suspect. I sometimes wonder how often they actually do check ones driving record.Never heard of them doing a CarFax either. Now if they would stop jacking up the rates because of ones credit score we would have it made.

  • avatar
    daver277

    I’ve always had great luck buying MECHANICALLY broken cars as I immediately dive into it, get to know it and then that first breakdown isn’t a rude awakening.

    • 0 avatar
      Kevin Jaeger

      Yeah, I’m not really comfortable with picking up a car that’s been crashed. Once things have been crumpled that’s something I’d leave for a body shop that can verify the frame is straight.

      But I’ve been very tempted to pick up a car with a blown engine or broken timing chain, or something like that. These days you can pick up cylinder heads or even complete engines from self service yards cheap, so if you’re willing to do the work picking up a non-running car can be tempting.

  • avatar

    I’m wondering if having a frame helps repairs of rolled jeeps, including modern ones. I saw some write-ups of mods where people pop the tub off the frame just to make access to drivetrain easier. Clearly it can’t be that bad, as long as you have a hoist.

  • avatar
    davew833

    I agree with Steve in that if you look for older cars with minor damage you can come away with some good deals.

    I’ve done this a couple of times– I have a non-auto related business license, and in my state that allows me to buy from the Copart insurance auctions. I just picked up an ’89 Honda Accord LXi coupe with less than 65,000 miles for about $400 including the buyer’s fees, etc. It had been hit on the left front corner, but aside from damage to the fenders and front bumper it looks AND drives like a 65,000 mile car that’s been garaged and well- cared-for. I’m going to put a new fender and bumper on it from the Pick-N-Pull and drive it until I can’t get parts for it any more. The 3rd gen Accords are known as some of the best-built, but because it’s so old there was really no interest in it from other buyers, even despite the average mileage of 2500 mi. per year. The safety inspection process in my state to go from ‘salvage title’ to ‘rebuilt/restored’ title is no different than safety inspection any car that hasn’t been wrecked.

    I bought a nearly identical car from the same auction for my nephew a few months ago that had been tapped in the back, breaking the taillights and bending the trunklid slightly. I easily straightened it and replaced the taillights and he’s now delivering Jimmy Johns sandwiches with it for a total investment of about $700. I drove both of these cars home from the auction with no problems.

    • 0 avatar
      Steven Lang

      That’s the way you do it!

    • 0 avatar
      NormSV650

      Ridesafely.com works with Copart. I have purchased cars for parts through them when their fees were a couple hundred bucks. But $1,000 fee for every car when buying without a dealer license is crazy.

    • 0 avatar
      matador

      That’s the secret to cheap success! My best car was a rebuilt 1995 Buick LeSabre. With 190k miles, it was virtually worthless. Out here, we have a guy that buys them from Copart, fixes them, and sells them for a small profit. My Buick cost me $700, including his profit.

      I’ve been watching Copart for my next project- something older, cheap, common, and worthless to most!

      P.S. @davew833 I notice the American Motors Avatar and like it. ;-)

  • avatar

    If you go one make house hold like I did. Salvage vehicles are bread and butter. I chose 76 to 94 Subarus. All of our older cars (83 to 90) now have modern EJ22 engines and uprated transmissions. One of them even has a full conversion to OBD 2. I could not have done it at all with out salvage cars. None of my cars have salvage titles, and I did ponder putting a fender and a hood on a 98 and driving it. But in reality, it is going to end up on it’s way to china after I pull the Engine, and Injection for spares. Sure I spent 300 bucks on it. Drove it home with out so much as strapping the hood down. But is it worth it to me to do the hoops. Nope. Now if it was something unique or interesting perhaps I would. But then again nahhhh. What is going to be interesting.. a WRX or something? Eh, nahh I have a SVX thank you. :)

    In reality I could not afford to keep these cars on the road with out salvage cars. But I cant afford car payments either. So the catch.. Dunno your mileage will vary. That is all I can say.

  • avatar

    One thing that always struck me as a possible good deal is theft recoveries, if the vehicle was just stolen and not crashed or heavily parted out.

    It may vary by state, but typically if a car is stolen and not recovered within 30 days, the insurance company pays out on it and gets the title, and if the car turns up after that the insurance company gets it and auctions it off.

    • 0 avatar
      MK

      Ha! Yeah most of the ones I’ve seen have in salvage yards are completely trashed. At least you know with most if the other “normal” wrecks that it was probably crashed by the owner, it was running at the time and you can tell a lot by the condition of the car as to how well it was maintained or cared for. With most theft recoveries, all bets are off.
      The only thing worse would be a car with an electrical fire , again in my opinion.

      My dad has been doing late model salvage cars for about 25 years and Steve’s initial post is quite accurate. He buys a number of cars for out of state buyers who will send car haulers to carry them to ports or Mexico. Also interesting is that the Southern US generally has some of the lowest prices on auction cars.
      I’ve personally owned and driven probably nine different salvage vehicles, properly repaired they’re no less reliable than the underlying make and model. The easy deals are few and far between these days, too much interest and bidding that makes th margins quite small for most people. my experienc has been that if your patient and not too set on any given vehicle that you can get a 1-2 year old car with lowish miles for about 60 pct of its retail price but it takes 2-4 months and if you try to immediately sell you’ll prob be able to get 75 pct of the value of its non wrecked kin.

      I don’t care because I buy them for long term use and the initial savings more than offsets the depreciated value down the road if its wrecked or sold.
      Also, in one accident totaling the vehicle for the second time my insurance has paid out the same as for a non-rebuilt car and no diff in premiums.
      The OP should just talk to an experienced salvage guy and have him do the purchasing, it’s not the easiest thing to crawl all over cars and inspect them anymore so you need to do your diligence.

  • avatar
    Atum

    IAAI is one of my most visited websites, and it’s always interesting to wonder what happens to the vehicles once they’re bidded on.

    I just hate that they focus less on the actual vehicle and more on the titles and sellers. (you can’t even search by trim level on the website).

  • avatar

    Be aware of local laws. Here in Connecticut it’s a pain in the ass to get a salvage car back on the road. A lot of times they at the very least will require you flat bed a car when its ready to be registered to a DMV location (has to be flat bed no wheels touching the ground) Than they saftey inspect it and follow up by asking for every receipt for every piece you put in the car. Than they will ask who did the labor sometimes if there was major damage (like a floor pan on a unibody car) they will make sure the work was done in a body shop in the state. So basically here it’s not worth it. When I did insurance work I went to Copart quite a bit. Most of the salvage cars went to scrap yards or shipped out of state. The body shops that did flips would look for cars damaged without insurance, as these won;t show up on the title and can be flipped with a clean title.

  • avatar
    gessvt

    I peruse a dealer site that specializes in turbo Subarus. Almost all of them are between 0-4 years old with rebuilt titles. All cars have plenty of interior and exterior detail shots, and damn if they don’t look like new. The rebuilt title cars have this disclaimer: “this car is being sold with a rebuilt title due to a minor insurance claim”.

    Fictional (but typical) example: 2013 STi with 900 miles, rebuilt title due to a “minor” insurance claim. Doesn’t a car have to be a total loss in order to ultimately get a rebuilt title? What’s minor about a total loss?

  • avatar
    tedward

    I know a guy who does this all day long. His rule is that he only buys vehicles that he has experience with, as he often gets burned by the first of a make to come his way. It was surprising to hear him identify the expensive stuff on civic’s, mazda3′s etc…, but that’s what he needs to know when assessing accident damage at an auction. He generally avoids European cars if they have been in an actual accident with body damage, but will go with them if the car is totalled for a mechanical fault. His basic assumption is that any car known particularly for exceeding safety standards will be difficult and expensive to reassemble.

  • avatar
    Andy D

    My car is an 88 528e. IT had 117k verified. For this car, that is nothing. It had not fared well with its 3rd owner, a high school senior. Worse the car had been “fixed ” once before. I paid 550$ for it and drove it home. There was nothing mechanically wrong the car. I had a parts car with the same paint. I had the parts to replace the tweaked parts, just a sawzall cut away. At the time, ’07, A 10 yr old vehicle is exempt from a salvage title. IDK if this is still the case in MA.
    It was a learning experience for me. I will do better next time. I observed and replicated the cut outs and folds of the structures I replaced. It took a bunch of time to straighten out,I feel it was worth it , 7 yrs , 50 k miles later to it. I was a ship fitter a few careers ago, before that, that I was house carpenter. I grok structure.

  • avatar
    omer333

    Hi, I’m sorry to hijack the thread, but I was wondering how I would email Steve and Sajeev a question?

    Is there a general email or should I just email Steve directly?

    Thank you.


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