How to Buy a Used Car and get a Clear Title
America's roads are full of the walking dead - or rather, the rolling dead: cars that are long past due for the graveyard, but are sold on by unscrupulous used-car dealers at full used-car prices. These aren't simply old hulks that are past their prime though. The Cash for Clunkers federal program had specific rules for how traded-in junk had to be wrecked in a car wrecking yard. But as you would expect, some dealers just don't have the heart to do that when there are some kinds of cars that simply don't look so dead on their feet.
Every year there are a lot of cars that become water damaged when there is a flood somewhere in the country. These are cars with flood titles; and while they could easily appear to run properly, they have terrible internal structural damage that could cause the cars to collapse in even a small accident. There are a few states in the country where there isn't a robust inspection program to make sure these cars aren't traded on. Conscience-disabled dealers just gravitate to these states and trade in these cars, that then just come on the market through classifieds and other means. So how exactly do these cars lose the flood titles they are saddled with at some part of their lives? Anyone who is looking into learning how to buy a used car needs to keep up with these shady methods.
The first step the gray market dealers undertake is title wiping. These dealers generally locate their "business" in a state that doesn't track most kinds of damage. Once there, they are able to channel their merchandise through several cycles of title changes that can successfully erase any record of flood damage or anything. The next step is the dirt cheap sale. These mass dealers in questionable cars sell them cheaply to used-car dealers who then go on to advertise supercheap private party sales. They call this process, "curbstoning". Whenever you read up about how to buy used car they tell you to make sure that the car comes with a clean title. The used-car dealers notice this; and that's where the next step comes in - giving these salvaged cars a clean and forged VIN, or vehicle identification number.
These dealers prefer to sell these cars for cash so that there will be nothing to trace the purchase back to them. Since this really works like organized crime, there is little that straightforward government regulation can do to contain this. Keeping this under control would need police squads and FBI agents. However, this doesn't mean that there is nothing you can do. To begin with, on the off chance that there were no forged VINs brought in, you can check the car's number on at least two national databases for used vehicles - ones like CarFax, AutoCheck or the National Insurance Crime Bureau. What you can personally do to stay out of trouble is, check the car's VIN plate really closely to see if there is a sign of tampering. Scratches in the area should really tip you off. But you do have to remember that VINs doesn't really come into their own until 20 years ago. For cars before then, VINs can be somewhat misleading. If you're one of those people who would like to take their chances buying a damaged or salvaged car with full knowledge of what you're doing, there are probably a few things you need to keep in mind.
Insurance companies these days have special staff trained to identify this kind of title wiping. If you have a car like that, they might refuse to cover it; but if they are willing, usually, it won't cost you any more to ensure such a car then any standard car. It all depends on how extensive and successful the cars repairers seem to be. And of course, if you bought a salvaged car without knowing it, and the insurance company later discovers that your car has seen extensive damage at some time; they will fagy you down as a risky bet for any insurance company, and your insurance rates could really go up.