By Alexo - July 12th, 2012 07:41 AM
A vehicle title, which is proof that you legally own the vehicle, is issued based on the vehicle's condition. Here is a brief outline of the five types of vehicle titles:
Clear or Clean Title means that the vehicle has not been damaged beyond repair and that there are no liens on it. This is the most desirable title for anyone buying a car and is often the only title that is eligible for financing.
Salvage Title indicates that a vehicle has been damaged beyond 75% of the original value. Salvaged vehicles can be repaired and made roadworthy, but will never be eligible for a clear title. A salvage title often lowers the price of a vehicle, no matter what make or model. Unfortunately, most lenders are reluctant to approve loans for purchasing salvaged vehicles. This might happen in some states, such as Florida, New Jersey and New York, which use salvage titles to identify stolen vehicles.
Rebuilt/Reconstructed Title is issued to repaired salvage cars that have been successfully restored to full operation and safety. Rules about this title vary from state to state, and an extensive inspection might be required before the vehicle is considered safe and allowed to be legally driven.
Dismantled Title is given to damaged vehicles where the cost of repairs exceeds the original value. While it is similar to a salvage title, a dismantled title means that the vehicle cannot be repaired for road use. Instead, it can only be used for parts and scrap metal.
Junk Title is similar to a salvage title in that it is issued once a vehicle is damaged beyond 75% of its value. A vehicle with this title is not eligible for road use. Some states consider junk and salvage titles as the same.
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