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Automobiles Auctions   >   Articles   >   Vehicle Title Branding

   
 

Vehicle Title Branding


If you're considering purchased a used automobile or other vehicle, one of the things that you should be aware of is vehicle title branding: what it is, what issues it can help alert you to, and why you can not always rely on branding information (or the absence of it).


What is Vehicle Title Branding?

When a vehicle has suffered major damage, for example from an accident, fire, flood, hail, etc., the vehicle may be written-off and sold for scrap (because the cost of repairs exceed the value of the vehicle). In such cases, the vehicle is considered a "total loss" or "totaled".

In most US states and provinces of Canada, the law requires a permanent designation of this status is added to vehicle's title, permit, or registration documents. This designation is known as "Branding".

The purpose of this action is two fold:
  1. Firstly, branding can be a deterrent to theft and fraud:

    • Branding makes it harder for criminals to repair totaled vehicles using stolen parts (possibly resulting in a dangerous vehicle).

    • Branding is also makes it harder for criminals to fraudulently use the registration papers of a totaled vehicle when selling a stolen vehicle of the same make/model (typically criminals would attempt to do this by switching the serial numbers of Vehicle Identification Numbers (VINs) between the two vehicles).

  2. Secondly, branding can be an important consumer protection measure:

    If a branded vehicle is sold, the purchaser needs to be aware of the history of the vehicle. Simply knowing that a vehicle has been in a serious incident, alerts potential buyers to the fact that the vehicle needs to be properly inspected to ensure that the vehicle is roadworthy, and that any repairs have been done properly and safely.

Types of Vehicle Branding

In the US and Canada, the majority of vehicle title documents, as well as the laws relating to them, come from the various states and provinces. As a result, even though most states/provinces do have laws relating to branding, there can be wide differences between the types of branding that are applied, and the criteria used to assign vehicles to different branding categories.

The most common categories of branding are:
  • None / Clear / Normal:

    This indicates the vehicle has not been branded. This often indicates that the vehicle has not been in an accident, or only in accidents where the cost of repair was less than the write-off value of the vehicle.

    However, you should also be aware that vehicle could have this status for other reasons:

    • The vehicle could have been severely damaged (and repaired) before the branding scheme was introduced.
    • The vehicle could have been severely damaged (and repaired) in another jurisdiction (with different branding laws), and then retitled in the current jurisdiction.
    • The vehicle could have been severely damaged (and repaired) without notifying an insurance company or the DMV.

  • Salvage / Junk / Total Loss / Véhicule gravement accidenté:

    A vehicle which suffered severe damage at some point in history. Typically however, this brand indicates that the cost of the repairs exceed most (typically 75% to 100%) of the vehicle's value. If such a vehicle is repaired, documentation of repairs, sources of repair parts, safety inspections, etc., may be required depending on the jurisdiction.

  • Rebuilt / Rebuilt Salvage / Prior Salvage

    A vehicle that was previously branded salvage, which has subsequently been rebuilt/repaired and then reinspected. Some jurisdictions may require reinspection if the vehicle is to retain this status after being moved across state/provincial borders.

  • Irreparable / Fire damaged / Flood damaged

    A vehicle which should be used only for parts or scrap.
In addition to the above, there may also be other status information linked to the vehicle in some jurisdictions (again not all jurisdictions may use all these categories, and definitions of the categories may differ). These statuses include:
  • buyback / lemon : A vehicle which a manufacturer/dealer was required to buy back from the purchaser after repeated problems when still under warranty.

  • taxi / police / fleet: A vehicle which was used in commerce (e.g. as a rental vehicle), in public transport, or by law enforcement. As a result, the vehicle may have been subject to higher than normal levels of wear and tear.

  • theft recovery: A vehicle which was previously stolen and then recovered/

  • abandoned / found on road dead: A vehicle that was founded abandoned by its owner.

  • wrecked / WRK / crushed / baled: A vehicle which was been dismantled, crushed, or recycled into scrap metal.

Issues and Pitfalls

As already noted, the laws around branding, and the criteria used to assign vehicles to different categories and statuses, are generally made by individual US states and Canadian provinces. As a result, there are wide differences, and things which need to be disclosed in one location, may not be disclosed in another.

A second issue, is that when vehicles are moved between different jurisdictions, branding requirements may differ, and if a vehicle is retitled the branding information can be lost (when done deliberately this is known as "title washing").

Another more subtle issue is that the system largely depends on accurate assessments of the value of vehicles and the cost of repairs. Anybody with any experience of automobiles will know that cost estimates for repairs can vary widely, even before one considers variations caused by choice of parts (new parts vs. aftermarket parts vs. parts taken from scrap). Moreover, an insurer or owner assessing the potential cost of repairs, may be inclined to prefer low cost estimates, given that branding the vehicle as a total loss would negatively affect any remaining resale value for the vehicle.

Finally, it does appear (see for example Consumer Reports July 2009), that there is a market in what is known as "clean title wrecks". These are vehicles that been severely damaged, but which have retained clean title by virtue of the damage being just below the write-off threshold, or by not having collision insurance, or by being self-insured. In such cases, the "clean title wreck" is typically bought by someone knowledgeable about motor vehicles who repairs the vehicle and then sells the vehicle on to a consumer - the consumer is of course never made aware of the vehicle's dubious history.


Summary

To summarize then, while branding can provide important and useful information about a vehicle that you are considering buying, you can't rely on it to tell you the whole story - or in all cases.

That's why it's always important to properly inspect a vehicle before deciding whether to buy.



Related Links


Here are some related links and websites:
  • Check Your VIN
    Offers vehicle history reports complete with over 60+ problem checks for a one-time fee of $12.99 per report.
    (Advertisement)

  • How To Buy Cars At Auctions
    With The Present Economic Crisis Theres Never Been A Better Time To Buy Cars At Auctions! This Website Will Provide You With The All Tools You Need To Benefit From The Thousands Of Vehicles Being Sold At Rock Bottom Prices At Auctions.
    (Advertisement)

  • Inspect Before You Buy
    ASE Certified Automotive Technician Teaches You How To Properly Inspect A Used Vehicle.
    (Advertisement)
Here are some related pages on this website:

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