Using Vehicle History Reports for No Credit Auto Loans
by Steve Cypher on Thursday, November 10th, 2011Save yourself a lot of hassle by first checking the vehicle history report on any used car you plan to finance with bad credit car loans
A first step
There are a number of used car shopping tools available even if you’re financing with horrible credit auto loans.
We should know because we’ve been a part of bad credit car sales for nearly two decades here at Auto Credit Express.
With a web site that covers bad credit auto loans so applicants can avoid buy here pay here dealers and learn the facts about such things as repossession, we are still surprised that some people aren’t familiar with vehicle history reports.
Vehicle history reports
One of the keys to a successful problem credit auto loan is choosing the right used car. There are a number of resources used car buyers now have at their disposal to make sure this happens, one of which is a vehicle history report.
The two largest originators of these reports are Carfax and Experian’s AutoCheck. And even though they are similar, you could possibly save money (depending on the number of vehicles you’re shopping) by choosing one over the other.
Cost
Looking at both the AutoCheck and Carfax web sites on November 7th of 2011, we found that Carfax charged $34.99 for a single report, while you could purchase one from AutoCheck for $29.99 – a savings of 14%.
AutoCheck also offers its users an unlimited number of vehicle history reports over a 30 day period for $44.99, while Carfax charges the same amount for just five of its reports.
Only the first step
But whichever company you decide to use, be sure to run one on any used car you consider buying. While these reports don’t always contain all the information on a car, they can begin the process.
Once you’ve narrowed it down, there is one more thing you should do.
Mechanical inspection
Once you’ve checked a vehicle’s history and it looks clean, you should then ask the seller if you can have it physically inspected. Then take it to a certified mechanic – preferably an ASE certified master mechanic – to have this done.
Both individual mechanics and companies offer this service. The cost typically runs anywhere from $100 to $200, but consider it money well spent, as a car with hidden damage could cost you thousands of dollars in repair bills plus a lower resale value when it comes time to trade it in.
If the seller refuses to let you do this, it’s best to just walk away from the deal.
The Bottom Line
Whether you choose AutoCheck of Carfax, a vehicle history report can be a valuable tool in deciding which used car to buy, especially when it might mean the difference between picking a cherry or a lemon.
Also know that at Auto Credit Express we help people with car credit difficulties find a dealer for their best chance at getting approved for a bad credit car.
So if you’re serious about getting your auto credit back on track, you can begin now by filling out our online car loans bad credit application.
Tags: Bad Credit, no credit auto loans, vehicle history reports
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Seven problems with a Carfax (or any Vehicle History report):
First, if the vehicle has been rebuilt (or salvaged) Carfax can only report this if the States’ DMV changed the vehicle’s title to “salvage, rebuilt, reconstructed, etc…” However, there are some states that do not indicate remarks on their titles such as “savage, rebuilt, true miles unknown, thief recovery, etc…” Also, if the insurance company does not notify the state that they have totaled a vehicle, the DMV will not change the title to ‘salvage, rebuilt, etc…” For example, a few years ago, State Farm was sued for not reporting over 30,000 totaled vehicles to the States’ DMV. Since the titles were never changed to salvage, Carfax shows these vehicles to have “clean” titles. These totaled vehicles were sold to salvage yards, patched together, and re-sold to the public with the original titles and a “clean” Carfax report. It is not uncommon for a professional pre-purchase inspection to find accident and frame damage on a vehicle when the Carfax report shows “no reported Structural / Frame Damage” or “Accident / Damage”.
Second, there is no database for body & frame shops to report accident damage and repairs, and not all insurance companies disclose or share their accident information. Carfax readily admits that there are thousands of accidents, each day, which will never show up on a Carfax report. Even if Carfax reports an accident, it cannot tell you the extent of the accident damage, or the quality of any repairs. Only a professional inspection by a Frame Specialist can give you that information.
Third, used car dealers know the limitations of a Carfax report. Some dealers knowingly buy vehicles with frame and accident damaged which have a “clean” Carfax report. They sell these damaged vehicles to unsuspecting buyers showing them the “clean” Carfax before they purchase. Bad vehicles are purchased every day because the seller/salesperson talked the buyer out of a professional inspection by showing a “clean” report. A vehicle history report cannot tell the buyer the current condition of the vehicle.
Forth, Carfax does not have any type of reporting mechanism with the tens of thousands independent repair facilities across the United States. Most of the Carfax reports have little or no repair information compared to the millions of automotive repairs performed each day. Even if Carfax reports a repair, it cannot tell you if the problem was fixed correctly or if there are additional mechanical/electrical problems with the vehicle.
Fifth, some States require an annual safety and/or emission testing. A safety or emission test is very limited in its testing and like a repair history, it cannot tell the buyer the current actual condition of all the vehicle’s components and systems.
Sixth, Carfax is a “History” report. There is a time lag between when a vehicle’s title was changed to reflect a “negative” comment and when Carfax actually reports the title’s new information. This time lag can allow a damaged vehicle to be re-sold before Carfax can report the negative information about the vehicle.
Seventh, search the web for complaints against Carfax. Many consumers have filed complaints and lawsuits that Carfax deceives their customers by concealing the limits of the information it collects. When confronted by irate customers, Carfax hides behind their disclaimer. (FYI, Carfax does not allow phoned in complaints).
The perception for a used car buyers is that Carfax offers comprehensive historical information about used vehicles, but the reality is, the information contained in a Carfax report is incomplete, limited, misleading, may not be current, and in some cases totally inaccurate. This difference between the used car buyers’ perception, and reality, will cause them to make bad decisions based upon incomplete information provided by a Carfax report.
A used car buyer should question the cost effectiveness of a vehicle history report. A Carfax report sells for $34-$45 vs. a professional pre-purchase inspection for around $150. Pay the $34-$45, and you still don’t know the current condition of any mechanical or electrical system, you still don’t know for sure if the vehicle was in accident(s) or the quality of any previous accident damage, and you still don’t know if the vehicle was abused or well maintained. Only a physical pre-purchase inspection by an ASE Master Technician (for all mechanical & electrical systems) and a Frame Specialist (for body and frame problems) can determine the true condition before you buy.
The ONLY way to determine the TRUE condition before purchase is to have the vehicle professionally inspected by an ASE Certified Master Technician for mechanical & electrical problems and Frame Specialist for previous accident damages.
The #1 reason bad cars are purchased is the buyers’ inability to determine the true condition of the vehicle before purchase. A history report cannot be used to determine the true current condition of the vehicle.