Always check the title and run from one that is “BRANDED!”
The age old adage, “If the deal sounds too good to be true, then it probably is,” certainly applies to Branded Titled vehicles. The tragedy is most buyers do not even know what a branded title is and are caught totally unaware as they are being ripped off.
Here at Freedom Auto Finders, we have had the misfortune to meet several people who have purchased a vehicle with a branded title and were either not aware or did not know how that might affect them.
So what is the big deal about a branded title and how does it affect the vehicles value? There is a variety of “Brands” that are applied to vehicles following certain events, such as a major collision or a flood. In their evaluation of one such damaged vehicle, an insurance provider has deemed it to be a total loss and has paid the insured for a replacement vehicle. This is often where the trouble starts. Instead of truly scrapping the vehicle and recycling it for parts, the insurance company exercises their right to recover some of the claim dollars paid out by reselling this totaled vehicle to the highest bidder, or even back to the owner. Then a rebuilder, or some other opportunist, buys the salvaged vehicle and puts it back together so it appears to be normal again.
Meanwhile the state brands the title “Salvage” to protect the next buyer and to make it clear this is a totaled vehicle. The rebuilder of the vehicle will apply to the state and have the title rebranded as “rebuilt” so they can resell it and, of course, make a nice profit.
So now the title is Branded “rebuilt” but the vehicle is repaired and looks great. What the big deal? The “big deal” is twofold. First, the true market value of this vehicle is only 30-50% of what it would be with a clean title. This is where the deal can sound “too good” while the reseller is making an insane profit. We have even discovered certain “licensed” Dealers specialize in selling these “rebuilt” vehicles because they can make enormous profits on the ignorant.
Secondly, there is the aspect of hidden damage. This can show up 500-5,000 miles after the repairs are complete and, depending on the competence of the rebuilder, it might wind up to be a good looking piece of junk. What about Recourse? Can’t I just return the car and get a refund? Unfortunately, these sellers know how to cover their tracks, and since they are not breaking any laws selling these vehicles, there is little anyone can do after the fact. The buyer has most likely signed a disclosure and the vehicle is sold “AS IS.” In short, it’s too late usually and it is happening every day.
This article only touches the surface of this topic, so as not to bore you with too much information but it’s our sincere hope we can help our readers in avoiding a major purchase mistake. Remember always to check the CarFax and get an AutoCheck. Insist on getting the vehicle inspected and know what you are buying.
Our Experience Can Help!
Buying or selling a car?
Here are a couple of important points that are worth considering before taking the plunge… The first is to be armed with the right information before you venture into the market. There are many web sites you can research and we provide a few here ourselves absolutely free. Just be cautious not to divulge personal information or expose your computers IP address to potential hackers who are really want to steal your identity. In Short,stay with names you recognize, like Edmunds, NADA, Kelly Book, Etc.
Also, when shopping for a pre-owned car, watch out for branded titles. These are vehicle that have suffered a loss and are often worth 50% or less of the Actual Market Value.Insist on a Carfax or Autocheck to verify the vehicle is really what you think it is. Unfortunately, some unscrupulous dealers have been known to sell branded title cars to unsuspecting buyers, who think they are getting a terrific deal, when they are really getting ripped off. Secondly, don’t get too emotionally involved in the process (easier said than done) as this can cost you thousands.
Sales people are trained in the art of negotiation and an average salesperson will train for hours, engaging in negotiations with 30 or more prospective customers each and every month and will successfully deliver about 120 cars per year. They understand that an emotional buyer is their best chance for making the sale and extracting maximum profits and the best salespeople know how to make you feel you have “won” in the process. Consumers, who believe they can win against these trained professionals, are much like those who visit the gambling halls with the belief they can beat the odds. Even the most astute buyers often leave money on the table. Remember too, it’s not that dealers are villains, they are not. Most are pretty upstanding and want to do the right thing but it’s a negotiation business and they do have real costs associated with retailing their cars. Neither do we believe in trying to rip them off, it’s just about providing the assurance that you have made the best possible deal with the least time, money and hassle as possible.
Lastly, be real! Every vehicle has two basic values, Actual Cash Value and Market Value. Generally speaking, Actual Cash Value is the wholesale value and Market Value is what a new or fully reconditioned car will sell for in the market place. How well you do on those two values depends on several factors and if you are trading your vehicle, the trade allowance is often inflated (another way to say discount) so you feel better about wholesaling your car to the dealer.
Consider this. If you buy a car for cash “no trade,” you may get what appears to be a get a great deal. Once you introduce your trade, the figures will not be all that appealing. If you keep your car and sell it yourself, you lose the tax credit. We help solve that dilemma by connecting buyers and sellers to maximize their deal on both sides. Here’s an example. We recently connected a client on a new Luxury vehicle. The Dealer made our client a terrific deal on the new vehicle but wanted to “steal” their trade. We found another dealer who would give top dollar for it and actually combined the two deals to save our client an additional $6000, and they didn’t have to give up their tax credit. Both Dealers were happy and, needless to say our client was elated. That’s why we say…We don’t care what you buy or where you buy it, we just want to help you get the best deal.