A branded title on a car is a title that indicates the vehicle has suffered serious damage or has some other major problem. The term "branded" means that the title and registration card contain a designation that discloses if the vehicle is classified as a flood vehicle, non-U.S.A. vehicle, rebuilt, salvage, or other similar designations. Branded titles can mean that the car was damaged in a flood, its odometer was rolled back, or it was involved in a major accident. Cars with branded titles have been repaired or rebuilt and sold, and they may cost 20% to 40% less than the Kelley Blue Book value of the same cars with a clean title. However, securing financing and insurance for cars with branded titles may be difficult.
Types of branded titles include:
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Salvage Title: A salvage title is issued when a car has been damaged to the extent that the cost of repairs exceeds the cars value. Salvage titles are issued to vehicles that have been declared a total loss by an insurance company.
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Rebuilt Title: A rebuilt title is issued to a car that was previously issued a salvage title but has since been repaired and restored to good condition.
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Flood Title: A flood title is issued to a car that has been damaged by water. Flood titles are issued to vehicles that have been declared a total loss by an insurance company due to water damage.
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Lemon Title: A lemon title is issued to a car that has a defect that cannot be repaired after a reasonable number of attempts. Lemon titles are issued to vehicles that have been bought back by the manufacturer.
Buying a car with a branded title can be risky, but it can also be an affordable option. However, mechanical issues can linger, and the costs to keep the car insured can be higher. It is important to be aware of the drawbacks that may make the deal not worth it.