What a brand title on a car means
When it comes to buying a car with a branded title, that can mean a good deal now, but a lot of possible costs down the road.
What is a brand title?
The title of a vehicle contains important information about it, and sometimes information about a past trauma. But despite some damage, if a car was not considered a total loss, it probably has a “clean” title.
When it comes to brand titles, this means that something bad has happened to a vehicle, usually an accident or disaster that caused enough damage to report it as a total loss. There are also titles that mark a car as having been used as a commercial vehicle.
There are different types of brand titles, and these vary depending on what happened to the car, the use of the vehicle, and the condition it was titled in:
- Rescue – A car so damaged that it would cost 75% to 100% of the total value of the vehicle to repair it (commonly known as “tallying”).
- Rebuilt / rebuilt – A car that had a salvage title, but has since been repaired and inspected. Some states do not have this title, which means that some repaired vehicles may still have a salvage title after inspection.
- Junk – A car that can only be sold for scrap or parts.
- Flood damage – A vehicle that has suffered extreme water damage, with some states allowing rebuilding of a flooded car.
- Fleet – A ticket for taxis, rentals and police vehicles. This title is required in most states.
- Lemon – It varies by state, as state laws differ when it comes to cars labeled lemons. Generally speaking, a lemon is a vehicle covered by a manufacturer’s new car warranty that has had a serious problem with repeated unsuccessful repair attempts.
Buy a branded car
Typically, franchised dealerships do not buy or sell vehicles with branded titles. This means that most of the brand name cars for sale usually come from private sellers or from small lots of used cars, both of which can carry additional risks.
It can be tempting to buy a vehicle with a rebuilt title, as it will likely be much cheaper than a vehicle with a proper title. But in order for a car to have a rebuilt title, it usually suffered heavy damage and required major repairs to make it serviceable.
In some cases, replacing a bumper on a vehicle could cost more than the value of the entire car, which could make it a good deal to buy one with a rebuilt title. On the other hand, if replacing the bumper totals the vehicle, is it worth buying a car that doesn’t have much value? Since buying a vehicle with a rebuilt title comes with many risks, it’s important to do your research to avoid wasting money and / or time.
You never really know what you are buying unless you know the full history of the car, the exact damage it suffered, and what was done to get it back. There are many sites that allow you to run a vehicle’s VIN through a database and collect car history information, such as the National Highway Traffic Safety Association (NHTSA). You should also have any used vehicle you plan to buy – especially one with a rebuilt title – inspected by a certified mechanic before purchasing it.
If you have a brand name car at heart, keep in mind that you may have to pay cash for it. Most lenders will not approve a loan for a vehicle with a branded title. If you are a borrower with bad credit, it could be extremely difficult to get approval for a car loan from a traditional lender, as well as a subprime lender, in addition to the car with a branded title.
Get in your next car
The bottom line when it comes to brand titles: it’s probably best to avoid them as a general rule. Some brand name vehicles could be a good deal – some could end up costing you a lot of money in repairs down the line. Plus, getting approved for a loan for a car with a branded title can be difficult, especially if you have credit issues.
If you need a car loan, but don’t think you have the credit to qualify, think again. Don’t waste your money on a risky cash sale for a branded vehicle, start with us at Auto Express Credit. We match borrowers with bad credit to dealerships who have real loan options for consumers with credit problems. To get started, fill out our free auto loan application form, and we’ll search for a dealership in your area!