The Insurance Information Institute offers tips that consumers with problem credit should follow before signing on the dotted line for a car loan
How to Avoid Buying a Flood Damaged Vehicle
Our experience

Car buyers with bad credit should be aware of the signs of water damage so they don't accidentally end up financing one of these vehicles with a subprime car loan.

At Auto Credit Express we appreciate the concern of the Insurance Information Institute because for more than twenty years we've been helping buyers with poor credit looking for online auto loans find the right kind of new car dealers that can offer them their best chances at getting financed.

Title washing

But the fact is that even though not a single high-risk lender our dealers work with will finance a vehicle that has a branded title -which includes those with water damage - that doesn't mean this situation has never happened.

When this does it's usually the result of one of these vehicles being purchased by a salvage operator who then cleans it up and re-titles it in another state. In many cases this results in a re-issued title that reflects no prior damage – a practice known as "title washing."

We recently came across an excellent article from the Insurance Information Institute (I.I.I.) that clarifies and discusses this issue:

Disaster damage

"Unscrupulous salvage operators and dealers often try to conceal the fact that the vehicles they are selling have been damaged by a natural disaster," said Jeanne M. Salvatore, senior vice president and consumer spokesperson for the I.I.I. "It is not illegal to sell or buy a flood-damaged car, however, it is against the law to sell a water-damaged car without letting the buyer know that the car had been damaged by a flood."

Spotting hidden damage

The article went on to elaborate that "To avoid inadvertently purchasing a flood-damaged car, it is important that you only buy a used car from a reputable dealer, have a certified mechanic look for flood damage and check the car's VIN number by using a credible industry database."

The I.I.I. also suggests that buyers be on the lookout for the following indicators that a car may have been flooded:

• Mildew, debris and silt in places where it wouldn't normally be found, such as under the carpeting in the trunk, or around the engine compartment
• Rust on screws and other metal parts
• Water stains or faded upholstery; discoloration of seatbelts and door panels
• Dampness in the floor and carpeting; moisture on the inside of the instrument panel
• A moldy odor or an intense smell of Lysol or deodorizer; this is a tactic frequently used by dealers to cover up an odor problem

If you suspect that a new or used car dealer in your area is committing fraud by knowingly selling flooded cars as undamaged vehicles, contact your insurance company, local law enforcement agency or the NICB at 800-TEL-NICB.


For consumers looking for a resource on the history of a specific car and whether it has been declared a salvage vehicle by a participating NICB member insurance company, the NICB created the VINCheck website. It provides consumers with a free search tool based on a vehicle's VIN (vehicle identification number). This service can be accessed from this NICB page:

As we see it

Consumers, especially those with credit issues, need to be careful when shopping for used car while remembering that if a deal looks too good to be true, it probably is.

One more tip: Auto Credit Express specializes in matching applicants with auto credit issues to dealers that can offer them their best chance at getting approved auto loans.

So if you're ready to begin that process, you can start it now by filling out our online auto loan application.