How Does a Car Become Salvage?

Totaled Car
••• Getty Images/Martin Diebel

Salvage title vehicles always come with a lot of questions. Most vehicles won’t ever become a salvage vehicle from the time they come off of the production line until they hit the junkyard decades later. How a car goes from "normal" to salvage is definitely a process. If you have recently been involved in a major accident or are considering purchasing a salvage title vehicle, it would behoove you to know how exactly how a car becomes a salvage -- and what you’re signing up for if you decide to purchase one.

Buyer beware! The most common ways a vehicle becomes salvage is by being involved in a major accident or a natural disaster.

The accident doesn't even have to be all that major if the vehicle is older and not holding much value at the time of the accident. Sometimes seemingly minor damage can be the end of a clunker. If a car is totaled, that can be step one on the road to becoming a salvage vehicle. Often these vehicles are sent directly to the scrap yard, but occasionally a salvage title can get added for those drivers who do not want to part with their beloved vehicle.

Sadly, even a shiny new vehicle can be turned into a salvage vehicle after a severe accident. Even if the insurance carrier does not want to mess with the repair, someone may be willing to take on the job. But once an insurance carrier says it is not worth repairing, it will be issued a salvage title, even if the repairs are undertaken. If you want to remove the salvage title by repairing the vehicle, it will have to undergo a rigorous inspection before you’ll ever be allowed to drive it on the public roads.

Each state has its own criteria for what makes a vehicle a total loss, also known as a salvage if repairs are made. Most states consider a vehicle with repairs costing 75% of its total actual cash value a salvage -- that is if repairs are made.

Flooding is the biggest culprit for turning a well-functioning vehicle into a salvage. Many times the damage is not visible at all to a buyer. The water dries up and leaves little evidence behind. However, the mechanics of a vehicle can be severely altered, leaving the vehicle often times useless. Dealerships in flood planes are at risk of losing their entire lot due to floods and hurricanes. Of course, many individuals have to deal with flooded vehicles, too. Insurance carriers will cover flood damage if comprehensive coverage is selected.

Additional Reasons for a Car to Be Salvage

It is not only major accidents and natural disasters which can cause a vehicle to be savage. Look for these other common reasons.

  • Kit Cars
  • Restored Antiques
  • Stolen Car Returned After a Total Loss Payout
  • Major Car Repair Using Aftermarket Parts