what is salvage title on a car

[MatthewMarie]

A salvage title is a legal designation for a vehicle that has been damaged to the point where the cost of repairs exceeds its actual cash value (ACV) before the accident. This label is applied by an insurance company after declaring the car a total loss. Essentially, the insurer has calculated that fixing the car isn't economically feasible. While a salvage title car can be significantly cheaper to purchase, it often comes with major risks, including potential hidden damage, safety concerns, and extreme difficulty in obtaining financing or insurance.

The specific threshold for declaring a total loss varies by state but is often between 75% and 100% of the car's pre-accident value. For example, if a car is worth $10,000 and the estimated repair cost is $8,000, an insurer in a state with a 75% threshold would likely total it.

Factor	Description	Key Consideration
Total Loss Threshold	The percentage of a car's value that repair costs must exceed to be "totaled."	Ranges from 50% (e.g., Colorado) to 100% (e.g., Texas) depending on state law.
Common Causes	Major collisions, extensive flood damage, fire damage, or theft recovery with missing parts.	Flood damage can cause latent electrical issues that appear months later.
Insurance	Most standard insurers will not provide full coverage; only liability insurance may be available.	You must often get a "rebuilt title" before any insurer will consider comprehensive coverage.
Financing	Banks and credit unions are very reluctant to offer loans for salvage-title vehicles.	This typically requires a large cash purchase.
Resale Value	The vehicle's value is permanently diminished, often by 40-60% compared to a clean-title equivalent.	Very difficult to sell privately; most end up at auctions or for parts.

Before considering such a vehicle, a pre-purchase inspection by a trusted, independent mechanic is non-negotiable. They can identify shoddy repairs and underlying structural or safety system damage that makes the car unsafe to drive. If the car is later repaired and passes a rigorous state inspection, it can be issued a rebuilt title, which is slightly better but still carries a major stigma and value loss. For most daily drivers, avoiding a salvage title is the safer financial and practical choice.

[MacBethany]

I'd run from a salvage title unless you're a serious mechanic or buying a dedicated project car. I bought one once because the price was too good to be true—and it was. It was a constant headache. Little electrical gremlins popped up everywhere, and I could never trust it on a long trip. Trying to sell it was a nightmare; dealers wouldn't touch it, and private buyers were justifiably skeptical. It's not worth the stress for a daily driver.

[EmilyDella]

Think of it as a giant red flag on a car's history report. An insurance company decided the damage was so bad that it was cheaper to write the car off than to fix it. This could be from a wreck, but also from flood water or fire. The big worry is that even if it looks fine now, there might be hidden problems with the frame or electronics that could make it unsafe. You'll have a very hard time getting a loan for it or insuring it properly.

[DiPhoebe]

My main concern would be safety, especially if it's for a family car. A salvage title means that car has been through a massive trauma. Was the airbag system properly replaced? Is the frame bent, making it less safe in another crash? You just don't know the quality of the repairs. I'd only ever consider one for a cheap second car, like a beater truck for hauling mulch, where safety systems aren't as critical. For anything you rely on, stick with a clean title.