What Is A Rebuilt Title For A Car?

If you’re in the market for a used car, you may come across a great deal for a vehicle with a rebuilt title.

A rebuilt title indicates that a vehicle was previously totaled but has been repaired (or rebuilt) and has been declared safe to drive. But even if a car has a rebuilt title, there are some things you should know before you consider buying it. Depending on your situation, buying a vehicle with a rebuilt title might not be a good idea.

We’ll cover what to look for and how to decide if a rebuilt vehicle is the right choice for you.

How a Rebuilt Title Works

When a car is brand new, it has a “clean” title. That indicates a car has never been declared a total loss. If a car is declared a total loss, it may receive a salvage title. However, it may receive a rebuilt title if that vehicle is restored to good working condition.

Aside from accidents, there are other reasons a car may receive a rebuilt title. Those include vehicles damaged by fire or weather and cars that have been bought back due to lemon claims. It may also include vehicles with odometers that were rolled back.

If a car is totaled, it will receive a salvage title, which indicates the vehicle isn’t safe to drive. If the car is repaired to the point of being drivable again, though, it may receive a rebuilt title. Depending on the state where the vehicle is registered, it may have to pass several tests before receiving a rebuilt title.

How Does a Rebuilt Title Affect a Vehicle’s Value?

Cars with a rebuilt title typically have a lower value than similar cars with a clean title. These cars have undergone significant damage, and buyers don’t always feel comfortable buying a vehicle with a rebuilt title.

There are many variables, but you can generally expect a value of about 20% to 40% less than the equivalent car with a clean title.

Related: What You Need To Know About Car Valuation and Insurance

How Do You Insure a Vehicle With a Rebuilt Title?

Buying insurance for a vehicle with a rebuilt title depends on the insurer. Some car insurance companies won’t insure them, while others will only offer liability car insurance.

However, you can take steps to build your case to obtain coverage with your insurance company of choice. For instance, you can provide documentation from a reputable mechanic stating that the vehicle is in good working condition.

If your current insurance company won’t insure the vehicle—or won’t offer you full coverage car insurance—you can always check with other insurers. One might be willing to insure it, particularly if you can prove that the vehicle is safe to drive.

Related: Solving Totaled Car Insurance Problems

Rebuilt Title vs. Salvage Title

A salvage title is different from a rebuilt title. A salvage title is what your car is given if it’s declared a total loss by an insurance company.

The damage could be caused by an accident, mechanical failure, flooding or anything else that might cause a vehicle to be significantly damaged. A vehicle with a salvage title isn’t safe to drive, so you typically can’t get insurance for the car.

Typically, a vehicle with a salvage title is sold either for parts or to someone who wants to repair the vehicle. If the vehicle is repaired and is once again safe to drive, it may receive a rebuilt title.

In other words, any car that has a rebuilt title once had a salvage title. Here’s how you can insure a car with a rebuilt or salvage title.

Rebuilt title vs. salvage title

Rebuilt title	Salvage title
Previously totaled	Currently totaled
Safe to drive after repairs	Not safe to drive
Can be sold to drive	Can be sold for parts or to someone who wants to fix the vehicle

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Reasons to Buy a Vehicle With a Rebuilt Title

Buying a vehicle with a rebuilt title may make sense. Here are some reasons why someone may want to purchase a vehicle with a rebuilt title.

Lower cost

The biggest reason to buy a vehicle with a rebuilt title is lower cost. These vehicles can be as much as 40% cheaper than similar vehicles with a clean title.

Availability

If you are looking for a used car, those with rebuilt titles might give you more options. If you’re buying a car that’s older or less common, considering a rebuilt title may help you find the car you want.

The damage may not be as bad as you think

Perhaps there was a single part on the car that was very expensive to replace, but the car itself isn’t damaged badly. You might be able to find a deal on a car that is in good condition.

Reasons Not to Buy a Vehicle With a Rebuilt Title

Let’s look at why buying a vehicle with a rebuilt title might not make sense for you.

You want to avoid unscrupulous sellers

While it isn’t necessarily the norm, sellers may try to take advantage of unsuspecting buyers. For example, they might try to hide damage to the car, making it appear to be in better condition than it is.

It might be tough to get auto insurance

Not all insurers cover vehicles with a rebuilt title. And even if they do, they may not offer the coverage you want. In other words, you might be stuck with barebones coverage that doesn’t offer you coverage if it’s damaged in a crash, destroyed by a flood or stolen.

It might be tough to sell

Some buyers are averse to vehicles with a rebuilt title. If you try to sell the vehicle, you may find that holds true with potential buyers.

What to Look for When Buying a Vehicle With a Rebuilt Title

There are some things to look for when buying a vehicle with a rebuilt title. Be sure you know what you’re getting before committing.

Flood damage or other warning signs

Flood damage isn’t always as obvious as other types of damage, but that doesn’t mean it isn’t an issue. There are some easy ways to spot flood damage, such as rust, waterlogged carpets and grime.

There are other warning signs you could see with a rebuilt title. These include large dents, non-working airbags and doors that don’t quite shut. If things don’t fit properly, you could be dealing with a car that wasn’t repaired well.

Look for proof that the car is safe to drive

You can use many services to verify a vehicle is safe to drive before purchasing it. Look up the vehicle using websites, including:

• Carfax
• VINCheck from the National Insurance Crime Bureau
• National Motor Vehicle Title Information System
• Kelley Blue Book
• AutoCheck

Using these services, you can find information, such as the car’s history of collisions, lemon claims and water or hail damage. If you aren’t comfortable with anything you find, the car may not be worth the potential future problems. For example, flood damage can cause major issues that you may prefer to avoid.

Related: How To Find Out a Car’s History

Don’t Assume—Get a Second Opinion

Even if someone selling a car with a rebuilt title says it has been restored to pristine condition, it can be difficult to know if they’re telling the truth. If you aren’t a car expert yourself, consider having a reputable mechanic look it over before purchasing. Even better would be to find a mechanic who has experience with rebuilt titles. They will know what to look for to identify common problems.