There are common scams in every industry, and when companies are trying to buy junk cars for cash, it is no different. To help protect you, we at Smitty Cash for Junk Cars would like to share a few of the common scams in the industry.
Salvage Vehicle Scam
An automobile that has been involved in a major accident and has been deemed a salvage vehicle is not worth repairing by an insurance company. It pays the maximum market value of the vehicle to the insured and then disposes of the vehicle by auctioning it off to the highest bidder once an insurance company declares a vehicle salvage. By the states where the vehicle is registered, the vehicle is then issued a special salvage title. Even if the vehicle has been restored 100%, the car is worth nowhere near as much as the comparable vehicle that has a clean title. Some unscrupulous sellers do not while most state and federal laws require a used car dealer or private seller of a vehicle with a salvage title to disclose the fact to the buyer. Below there are some common car scams associated with salvage titles that you should be aware of.
Can You Wash a Title?
In order for them to seem to be normal used cars, a salvage vehicle is rebuilt. It can certainly save you a lot of money when purchasing a salvage vehicle. By unscrupulous car dealers, this type of scam is commonly called lemon laundering and is unfortunately practiced all to often. One after another, the scam involves registering the vehicle in several states. Concerning the documentation of car titles, this usually takes place in states that have rather lax or loose rules and regulations. The title will eventually end up not having a salvage or junk title annotation on it if a dealer registers the vehicle enough times. Usually collecting a premium on the vehicle, the dealer is then able to sell the vehicles as a normal used car.
Lose a Car Title?
The biggest type of salvage title fraud is the lost title scams. The seller of the vehicle tells you that they must sell the vehicle quickly is how this scam usually works, as they are willing to sell it at a deep discount. Because he/she has lost the title, they tell you the reason for the sale and such a low price. For a new title, the seller may tell you that he/she doesn’t have the funds to apply. You can apply for the title yourself; they may offer you some sort of written authorization. You still paid way too much for a salvage vehicle and what they don’t tell you is that the salvage vehicle has a salvage or junk title. To avoid the scam, conduct a vehicle title search online.