What Is a Salvage Title?

 What Is a Rebuilt Title?

Should You Buy a Car With a Rebuilt Title? Here’s What You Need to Know

You’re browsing Facebook Marketplace for a budget-friendly used hatchback when suddenly, you spot it—a sleek Subaru, newer than you thought you could afford, yet somehow within your price range. Your heart races as you scroll through the listing: leather seats, low mileage . . . could this be the deal of a lifetime?

Then you see it: rebuilt title.

What exactly does that mean? Is it a red flag? Why is the car so cheap? If you’ve ever wondered about rebuilt titles, keep reading—we’re diving into all the details.

What Is a Rebuilt Title?

A car gets a rebuilt title when it has been deemed a total loss by an insurance company, then repaired and deemed roadworthy again. However, “roadworthy” can be subjective.

You might end up with a dependable car at a bargain price that has served you well for years.

Or you might get a money pit that leaves you stranded.

While buying used is generally a smart financial move, it comes with risks. A rebuilt title increases those risks significantly.

Rebuilt Title vs. Salvage Title

If you think rebuilt and salvage titles are the same, you’re close—but not quite right.

When an insurance company declares a car a total loss, it receives a salvage title. At this stage, the car may be scrapped for parts or repaired by someone looking to make a profit. Once repaired and inspected, it gets a rebuilt title.

Think of it like this: A phone with a shattered screen that won’t turn on is a salvage title car. That same phone, repaired and listed as "refurbished," is a rebuilt title car. Do you trust that refurbished phone? Will it work flawlessly, or will it have hidden glitches? Now imagine that uncertainty—but with a much more expensive purchase.

Rebuilt Titles Vary by State

Every state has its own rules for labeling and branding car titles. Some states are more thorough, marking titles for issues like flood damage, severe accidents, or even meth contamination (yes, that’s a real thing!). Others have more relaxed regulations.

This inconsistency allows shady sellers to title wash, moving a car from state to state to erase evidence of its troubled history. While illegal, it still happens.

Additionally, what qualifies as a “total loss” varies. In some states, a rebuilt title may indicate minor damage, while in others, it could mean major structural repairs. The process for certifying a rebuilt vehicle also differs, making it difficult to compare cars across state lines.

How a Rebuilt Title Affects a Car’s Value

The biggest reason rebuilt title cars seem like bargains? The title significantly reduces the vehicle’s market value—usually by 20–50%.

A car with a rebuilt title has likely suffered severe damage, like a major accident. Even if expertly repaired, hidden problems could still exist, lowering the car’s resale value and making it harder to sell later.

Reasons to Consider a Car With a Rebuilt Title

1. Lower Price

The biggest perk of a rebuilt title car is the price. You can often get a newer, feature-packed model for much less than a clean-title equivalent. Heated seats in winter? Yes, please.

2. Limited Options in Your Area

In places with fewer used car options—like rural areas—a rebuilt title vehicle might be one of the better choices available.

Why You Should Think Twice Before Buying

While the savings are tempting, there are serious risks involved with purchasing a rebuilt title car.

1. Possible Safety and Reliability Issues

A rebuilt title means the car was once deemed not worth fixing by an insurance company. That’s a red flag. Even if it was repaired, there’s no guarantee all issues were addressed properly. Structural integrity, electrical systems, and airbags are just a few critical components that could have lingering damage.

2. Untrustworthy Sellers

Rebuilt title cars often attract dishonest sellers. Some cut corners on repairs to maximize profits, leaving you with a ticking time bomb. Even sellers who claim the car is in perfect shape may not disclose the full extent of the original damage.

3. Expensive, Limited Insurance Options

Most insurance companies hesitate to fully cover rebuilt title cars. If they do offer coverage, it’s often limited to liability only—meaning you won’t be reimbursed if your car gets damaged. And whatever coverage you can get? Expect to pay higher premiums.

4. Difficult Resale

Selling a rebuilt title car can be a challenge. Just like you’re asking questions now, potential buyers will, too—and many will walk away the moment they see “rebuilt title” on the paperwork.

What to Watch for When Buying a Rebuilt Title Car

If you’re considering a car with a rebuilt title, knowing what caused the damage is crucial. Here are some common reasons cars get totaled:

• Flood Damage: Water-damaged cars often resurface on the market with hidden electrical issues.
• Cosmetic Damage: Hail damage or minor dents may total a car without affecting its performance—these are the best-case scenarios.
• Expensive Part Replacement: Airbags, for example, can be costly to replace, sometimes leading to a total loss.
• Major Collision: If the car suffered frame damage or extensive repairs, tread carefully.

How to Protect Yourself

If you’re set on buying a rebuilt title car, take these steps to minimize risk:

✔ Buy from a reputable dealer ✔ Verify the title branding ✔ Check the car’s history using its VIN (via Carfax, AutoCheck, or the National Motor Vehicle Title Information System) ✔ Get a pre-purchase inspection from a trusted mechanic ✔ Test-drive the car and check for alignment issues, leaks, and odd sounds

Insurance Considerations for Rebuilt Title Cars

Most insurers won’t offer collision or comprehensive coverage for rebuilt title cars, only liability. That means if your car is damaged in an accident or a natural disaster, you’re out of luck.

If you already own a rebuilt title vehicle and your insurance premiums are sky-high, consider working with an independent insurance agent who can shop around for the best possible rate.

Final Thoughts

A rebuilt title doesn’t automatically mean a car is junk—but it does mean buyer beware. If you do your research, understand the risks, and take proper precautions, you might land a great deal. But if you’re not careful, that “bargain” could turn into an expensive mistake.

Before making a decision, weigh the pros and cons carefully—and always get a second opinion from a trusted mechanic!