What is a branded title on a used car?

Imagine finding a dream car, priced surprisingly low. Before sealing the deal, a critical piece of information surfaces—it has a branded title. It is an official tag indicating that a vehicle has a history of extensive damage, odometer issues, or a defect that prompted the manufacturer to repurchase it.

Today, we answer the most frequent questions on what this designation entails and whether a mark on a vehicle title spells doom for the deal.

Typically, branded titles arise when insurance companies decide not to cover repair costs following a significant accident, and instead to pay the whole car value to the insured (the car owner).

So, if the damage surpasses the vehicle's value, insurers might declare it as a total loss, resulting in a title marked or branded.

Consequently, any potential buyers of vehicles with branded titles encounter challenges, including difficulties with the car registration and financing, insurance complexities, problems with resale, and potential future repairs.

A clean title signifies that a car has not experienced a recorded serious accident, theft, lemon-law buyback, and can be registered and insured conventionally.

1. Salvage Title: This label indicates that a car has been deemed a total loss due to wreck damage exceeding repair costs. Cars with salvage titles must be restored to a roadworthy state before registration and use. The Missouri Department of Revenue (DOR) describes a salvaged vehicle, also referred to as a total loss, as a car that meets two criteria: It is less than 7 years old at the time of damage, and the extent of damage is such that the repair cost exceeds 80% of the car's fair market value.

2. Rebuilt Title: Following a salvage title, a rebuilt one is assigned once the vehicle is repaired and meets roadworthy standards. Although rebuilds can be registered and insured, their resale value is significantly lower. In Missouri, a prior salvage title can be obtained for vehicles that have been rebuilt to safe operating conditions after being deemed non-operable in a total loss claim. Additionally, if the insurance company deemed the vehicle operable without requiring repairs following a total loss claim, it is eligible for a prior salvage title. However, the Missouri Department of Revenue cautions that the application process for a prior salvage title in Missouri is meticulous, and strict adherence to specific requirements is crucial.

3. Lemon Law Buyback Title: Cars repeatedly experiencing the same issues may be deemed lemons. If bought back by the manufacturer,such vehicles receive a lemon law buyback title. Despite repairs, these cars might face challenges in resale.

4. Odometer Rollback: While tampering with a vehicle's mileage is illegal, it can unfortunately still occur. Identifying odometer fraud demands vigilance, underscoring the significance of a pre-purchase inspection. One method to detect odometer fraud is by scrutinizing the vehicle's title and cross-referencing the mileage records with the reading displayed on the odometer. In-depth data, including the vehicle's odometer readings, is frequently available in maintenance and inspection records. Explore more about car maintenance here.

5. Other Types of Brands: Title brands may also result from flood damage, hail damage, or other scenarios. Thorough research and vehicle inspections are crucial when dealing with any form of a branded title, as even seemingly minor brands can lead to future complications.

Brand is a permanent mark on the title. Once a brand is assigned, attempting to alter it is illegal. A branded title stays with a vehicle for its entire lifetime, even if it undergoes meticulous repairs. While changing a Salvage Title to a Rebuilt Title through proper repairs and inspection is possible, removing the brand entirely is not permissible. At Clement

A crucial consideration when buying a used car is that each state issues its titles, and not all states follow the same title branding procedures. Title washing, an illegal practice, involves selling a vehicle across state lines to erase its title branding. Performing a full title check as part of a vehicle history report and opting for a pre-purchase inspection is especially crucial when considering a vehicle from another state.  

You have several options to check if a car has a branded title:

1. While CARFAX reports come at a cost of $39.99 for a single report, their value in the car-buying process is significant. CARFAX not only discloses whether a car has a branded title but also furnishes information on the date of title issuance, maintenance records, actual mileage and the number of previous owners. This information is invaluable when purchasing any used car. For a more detailed guide, explore our checklist for buying used cars. 
2. VINCheck, a complimentary service offered by the National Insurance Crime Bureau, empowers you to ascertain whether a car has been flagged as stolen or labeled as a salvage vehicle by insurance companies involved in the program.
3. Another effective method to ensure the acquisition of a vehicle with a clean title is to buy from a used car dealership with Certified Pre-Owned (CPO) cars. For instance, all CPO cars at Clement Pre-Owned undergo a rigorous inspection process and come with a warranty backed by the manufacturer, providing added assurance and peace of mind to the buyer. Additionally, we offer a complimentary 30-year, 300,000-mile warranty and a 5-day "love it or swap it" policy, providing added assurance and flexibility for our customers.

The decision to invest in a vehicle with a title brand hinges on several points. Here are some pros and cons to weigh:

Pros:

• Cost Savings: These cars are often priced 20% to 50% lower than their clean-titled counterparts.
• Budget Expansion: Buyers can gain access to newer vehicles with enhanced features while staying within budget constraints.

Cons:

• Resale Challenges: The stigma associated with marked titles may trigger suspicion among potential buyers, affecting the vehicle's resale value.
• Financing Hurdles: Some lenders may hesitate to finance cars with branded titles, potentially resulting in higher interest rates.
• Insurance Complexities: Many insurance companies offer coverage exclusively for vehicles with clean titles. 

In the intricate world of used cars, branded titles act as storytellers, revealing a vehicle's past. While the allure of affordability is undeniable, the risks associated with those titles are really high. 

If you are looking for a used vehicle that aligns with both budget constraints and long-term peace of mind, browse the Clement Pre-Owned inventory or visit us at our two locations in St. Charles and Florissant, MO. We offer thousands of models with meticulously inspected car histories and convenient financing options to suit any budget without risking quality and safety.