Can You Get a Title Loan on a Salvage Car?

When an automobile is significantly damaged by an accident, insurance companies write it off as a salvage. This condition is commonly described by car owners as “totaled.” When a car is totaled, the original title becomes void. Essentially, the car no longer exists. 
Most folks accept the loss, take a check from their insurance provider, and let the towing and storage company have the car to cover any outstanding fees. There are instances, however, when the damage is fixable.
What is a Salvage Title?
The car may not run, but it still could be worth something. In order for it to change hands, there has to be some documentation that designates ownership. Enter the salvage title. Though most often used by automobile salvage professionals, a salvage title can be issued to a private party.
In some states, an automobile that’s been declared a total loss by the insurance company cannot be sold back to the original owner without passing a safety test. If that requirement has been met, or you live in a state where it’s not relevant, your salvaged auto has value.
Applying for a Salvage Title Loan
Vehicles salvaged after being declared a total loss by insurance companies are usually 75% to 90% damaged, so the value of the car won’t match the Kelley Blue Book value you might get with a regular title loan. Keep that in mind when you apply for a title loan.
Another obstacle you may run into when applying for a salvage title loan is that salvaged cars aren’t typically insured. Most lenders require insurance to protect their investment. Getting them to lend you money without it is difficult, though not impossible.
If you’ve done extensive work to the car, and it’s roadworthy, it is possible to request a title category change from the DMV. In addition to “salvage title,” most DMVs also offer “rebuilt” or “assembled” as distinctions. You’re more likely to get insurance for one of those.  
Shop Around to Different Salvage Title Lenders
There are always multiple options when you’re shopping for a quick loan. Do a search for “salvage title lenders” and you’ll likely get a list of online personal loan providers. Search those sites carefully. The salvage title loan option isn’t usually easy to find.
For those lenders that do offer it, search the terms and conditions carefully. Loans on salvaged vehicles are a fraction of what they can be for the same car with a clean title. You may be able to get more value by simply selling the salvaged car outright.
Notice: Information provided in this article is for informational purposes only. Consult your financial advisor about your financial circumstances. 
Source: iQuanti, Inc.