Salvage Car Business & the Scams to Avoid

7 min read
Car Business

A salvaged car is supposed to be one that was involved in a serious accident and the insurance company has deemed it as unfit for hitting the road. Whenever the insurance company identifies a vehicle as unfit for the road, it would be paying the maximum price for the vehicle as per the market value to the insured person. The insurance company is then supposed to sell off the car by auction. The highest bidder would get the car with a salvage title.

The car is issued a particular kind of title by the relevant state where the car is actually registered. Remember that a salvaged car is quite difficult to insure.

A salvage title car always has some sort of a stigma attached to it. It gets very low price offers as compared to the same car with a clean title even after a complete refurbishment and when currently the car is in 100% operating state.

Most federal and state laws need a used vehicle dealer to disclose all facts and information to the buyer. Many individuals in the business of selling salvage cars often use unscrupulous ways. You must steer clear of car scams.

Title Washing Scam

Many salvaged cars are bought by rebuilders who refurbish the car and restore it to almost 100 percent efficiency levels. These cars look just like commonly used vehicles with clean titles.

Many dishonest businesses would be indulging in the title washing scam. They would sell off the car to a buyer at attractive prices without revealing the real status of the car. A car buyer would be enticed to see the amazing price offers as it would save him a whole lot of money. The person interested in buying a used car would be too glad to buy the salvaged car at such enticing prices without any idea about the vehicle’s condition.

This sort of scam is referred to as the lemon laundering or title washing scam and usually practiced by several unscrupulous car brokers and used car dealers. If you wish to sustain the business for a long time, you need to build a goodwill and good reputation in the used car market. So it is best to not indulge in this sort of a scam.

The scam would include registering the car in many states. This would be occurring in all those states where there are loose rules and regulations relating to the proper documentation of all these car titles.

Car Business

Suppose a used car dealer registers the car a number of times, only then there is a possibility that the title would be ignored after numerous registrations. The car dealer would then cleverly sell the car as a perfect used car with no title. Whenever you are thinking of buying a used car for parts, you must opt for salvaged cars for sale and use all the good auto parts.

The most effective way of staying clear of the lemon laundering or title washing scam is to opt for a thorough research online. You may visit reputed sites and pay a small fee for taking out a vehicle history report before buying any used car.

These sort of effective reports are generally accurate and could rapidly generate the car’s title history information.

Rapid Sale and Lost Title Scam

The well-known lost title scam is supposed to be the greatest fraud ever. However, this sort of a scam is generally not done by used or salvaged car dealers. It is mostly perpetrated by unscrupulous individual sellers.

The scam would actually involve a seller who tells the buyer that he needs to sell off the car immediately for some emergency needs and that he would be more than happy to sell off the car at a phenomenal discount.


If you are looking for success in the salvage yard business or in the used car dealership, you need to be honest and must have the integrity of character. Stay away from scams as you would be caught sooner or later and your business could completely go for a toss.

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