Consumers with poor credit that plan on financing a used car should be sure the car they plan on financing does not have a branded title
Just because lenders that offer bad credit auto loans would never finance a used car with a branded title doesn’t mean some unsuspecting buyers won’t be making payments on one.
Here at Auto Credit Express we know this can happen because we’ve spent the past twenty years helping people with poor credit searching for online car loans find those dealer that can offer them their best chances for car loan approvals.
Used car issues
From time to time during those two decades, we’ve received complaints from buyers that have been taken in by unscrupulous sellers.
The results of this can be disastrous. Vehicle problems can range from electrical system issues to engine and transmission failures. So here is what used car buyers need to know:
If a vehicle is involved in an accident or other type of event that causes enough damage to declare it a total loss, if it can be repaired it’s issued what is known as a “branded title.” As a rule, banks, credit unions and even lenders offering high risk car loans will usually not finance these cars.
Branded titles vary by state but usually include the following types:
Rebuilt – A vehicle previously branded as “salvage” that has been repaired and inspected. These vehicles might be drivable, but having this type of title
means that it was, at one point, a salvage vehicle.
Salvage – A vehicle with sufficient damage that would typically cost between 75% and 100% of its value to be repaired. In states with no rebuilt brand, salvage vehicles that have been repaired still carry the salvage brand on their titles.
Junk – a vehicle that can only be sold for scrap or used for parts
Flood Damaged – A vehicle that has been severely water damaged. In some states a flood damaged vehicle might be issued a title with either a salvage or rebuilt brand.
Fleet – Although these vehicles typically are not issued a branded title, most states require that vehicles previously used as taxis, daily rentals or police cars must be designated as fleet vehicles.
Mileage unknown – Also usually not considered a brand, most states require that a title be notated if vehicle mileage is unknown due to odometer replacement or other related issues.
Stolen – These vehicles often don’t have their own a brand, although many states may refuse to title a recovered stolen vehicle. Due to the damage they can sustain, many of these vehicles receive other types of brands so they cannot be re-sold.
Other title differences
Depending on the state where it was issued, the color of branded titles can be the same or different from those of clean titles. But in any case, branded titles will have a notation at the top or the bottom that sets them apart from regular titles.
What you can do
Your best chance at avoiding buying a previously damaged vehicle is to first run its VIN number through the national database, then request a vehicle history report and, finally, have it thoroughly inspected by both a certified master mechanic and a body and frame specialist prior to signing any paperwork.
One other thing: if you’ve been turned down for a conventional auto loan we want you to that Auto Credit Express helps people that have experienced difficulties with their auto credit find those new car dealers that can offer them their best chances for approved car loans.
So if you find yourself in this situation and you’re ready to reestablish your car credit, you can begin now by filling out our online car loan application.
Get your free credit score now! Get a copy of your most recent credit score.
Are you paying too much on auto insurance? Compare rates in your area and save.