Purchasing a vehicle that was bought back from insurance

[johnny quest]

Looking at a vehicle, and according to the seller, the vehicle was bought back from insurance, and while it currently has a clean title, it will have a rebuilt title once the new owner titles it.

Is this different than a salvage title?

How does he currently have a clean title if he bought it back from insurance?

Has anyone gone through this process? would you recommend doing the same (as long as the vehicle checks out)

[1987Comanche]

He has a clean title b/c, at this point, the title hasn't actually changed hands.  When the truck was totaled his insurance paid out, told him the vehicle was worth $xxx, and gave him the option to either keep the truck or let them take it and sell it at the auction.  He kept the truck and the title never left his possession.

 

  Title laws vary by state (not sure what UT says) so I'm not sure how the title transfer is handled.  Certainly Carfax et al have a record of the wreck.  In the case of my '65 Olds I would have likely ended up with a clean title as she didn't have a 17 digit VIN.  No one could find body parts to fix her, however, so I let the ins company have her. 

 

FYI the insurance auction company is IAAI.

[johnny quest]

IAAI?

[johnny quest]

the vehicle (according to the seller) had minimal damage. all cosmetic. I'm tempted to pick it up for a winter driver.

[87Warrior]

My 03 TJ Rubi has a Rebuilt Kansas Title. I bought it in 03 from an IAAI auction in MI. At least here in KS, the rebuilt title is treated the same as a clean title. No special provisions, taxes, or insurance cost.

[Motorcharge]

It really depends on the state. Get the VIN and call your insurance company. They'll be able to tell you what the title status is and what they'll offer for coverage. Don't tell them it's been wrecked or anything when you call because the less info they have the better for you and your rates.

[sinkrun]

Call a local notary and ask them most likely they have been through it before.

[gogmorgo]

A bit of an aside, but I recently found out that in some states, the inspection performed before a rebuilt title is issued isn't so much a roadworthiness inspection as it is an inspection into whether or not you can prove that you didn't acquire the parts you used to rebuild the vehicle by stripping the vehicle prior to abandoning it and then legally acquiring it at auction. The cars that pass do so because the repairer had receipts for parts he may or may not have installed on the vehicle.  :eek:

 

Whether or not it gets a salvage title is really up to the insurance company, and some do it differently than others. Most have a cost to rebuild as a percentage of total value set, but it can be a little foggy in some cases. One member on here had unibody damage to his XJ, but kept a clean title, after the insurance company very nearly wrote it off. In some states it's regulated more than others. My best guess is if they haven't issued a salvage title (and the seller says it's clean), then it's probably still clean.

[Automan2164]

I've bought 2 vehicles back from total loss situations. Both times, the title never left my hand. Both times the title remained clean.

 

Even discussed this with the claims adjusters both times because I was worried about that. I don't know what that guy may have done, but it sounds a bit out of place.

Rob