Even though tropical storms and flooding are distant memories borrowers with bruised credit should remain on the lookout for vehicles with water damage
According to Experian Automotive, consumers with damaged credit have a greater chance of financing a car with a branded title or some type of hidden damage. Since this includes vehicles with water damage it would help if these buyers learned how to spot this type of problem.
Here at Auto Credit Express we think this is a good idea because for more than twenty years we've been helping car shoppers with problem credit who are searching for online auto loans find the kind of car dealers that can give them their best opportunities for auto loan approvals.
Financing flood damaged vehicles
While not a single high-risk lender that we know of will finance a vehicle with a branded title (which includes those with water damage), this situation can, unfortunately, still occur.
When it does happen it's usually the result of salvage operators buying vehicles with some type of accident or flood damage, cleaning them up, and then re-titling them in another state so they then have a new clean title in a practice known as “title washing.”
Selling cars with hidden damage
In an article published not long ago, the American Automobile Association noted that cars with flood damage can often appear up to a year after a major flood. Not only that but these vehicles are then shipped and sold as new or used cars to every state.
"Depending on the vehicle make, model and age, the cost of a thorough cleaning and drying may exceed the car's value," said John Nielsen, director, AAA Auto Repair. "In many cases, insurance companies 'total' flood-damaged vehicles that are then sold to salvage companies."
"However, rather than being disassembled for parts, some of these vehicles end up being purchased by individuals who bring varying levels of expertise to the restoration process," continued Nielsen.
Because many areas of a motor vehicle are difficult to get to (such as door locks, wiring harnesses and heating and air conditioning components) they are not that easily cleaned. These systems might initially perform properly but they could – due to corrosion and oxidation - fail at some later date.
Tips from AAA
Here are some tips from the American Automobile Association on how to spot vehicle flood damage:
• Obtain a CARFAX Vehicle History Report – One of these can potentially reveal if the vehicle has been involved in a flood, major accident, fire, or uncover odometer fraud.
• Engage your sense of smell to detect any damp or musty odors inside the vehicle.
• Has the carpet or upholstery been replaced or recently shampooed? Pullback the carpet at different areas and look for mud, dirt or signs of water stains.
• Inspect the dashboard underside for signs of mud and dirt. This is a particularly hard area to clean.
• Look under the vehicle for corrosion. It is uncommon to find corrosion in newer vehicles and those that are owned or sold in southern states.
• Open all doors, hood, and trunk to inspect for corrosion, mud and dirt or discoloration on the door frames, hinges and under the weather stripping. Pay special attention to small spaces and crevices that are difficult to clean.
• Check all warning lights, window motors, and all electrical components to ensure they are working properly. While a non-working part alone does not mean the vehicle was flooded, it combined with other difficulties is a cause for concern.
• Always have the vehicle inspected by a quality repair facility prior to purchasing. AAA Approved Auto Repair facilities are located across the United States. Nearby locations can be found at AAA.com/Repair.
The Bottom Line
Borrowers, especially those with bad credit, should be especially careful when picking out a used car. While new cars are typically covered by state lemon laws, used cars usually aren't. Something to keep in mind: If the price of a used car looks too good to be true, it probably is.
Another good tip: at Auto Credit Express we want car shoppers with poor credit to know that we specialize in helping consumers with car credit issues find dealers for their best chances at approved auto loans.
So if you're ready to reestablish your auto credit, you can begin now by filling out our online auto loan application.