What is a Branded Title on a Car?
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A car’s history can have a significant impact on resale value and selling price. For example, an accident-free 2018 Toyota Camry will be worth more than the same make and model that has been in an accident. So, a car’s title is not only used to record ownership information but to report serious issues with a vehicle that affect its safety and value. This is called title branding.
You ask, “What is a branded title on a car?” In general, a branded title refers to a compromised car that has been affected by a severe accident or another significant situation, like flood damage. Title branding is issued by each state’s motor vehicle agency and not through third parties.
Read on to learn more about what is a branded title on a car.
Types of Title Brands
“What is a branded title on a car?” also means looking at the types of title brand labels each state uses. With this in mind, we’ll review common title branding terminology. We’ll skip a state-by-state description but focus on broader terms applicable in most situations with damaged or defective cars. Your state’s department of motor vehicles can provide specific information for your area.
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Salvage Title
You’ve no doubt heard the expression about a car being “totaled.” Well, that’s what happens when an accident-damaged vehicle costs more to repair than it’s worth. Other events, like a flood or fire, can also cause the same thing. In these situations, a salvage title is issued. The definition of a salvage title may vary from state to state, but generally, it means that an insurance company has declared the vehicle to be a total loss. In most cases, this title designation will follow the car. Salvage title cars sell for substantially less than comparable damage-free cars, but unless you’re buying a car for parts, it’s best to move on to another option.
Lemon Title
All states have a type of consumer protection regulation called lemon laws. These rules mandate, under specific conditions, that an automaker must take back a defective car that could not be fixed. Requirements vary by state, but typically, if a new vehicle cannot be returned to normal operating conditions after multiple repair attempts and is out in the shop for at least thirty days, the manufacturer must repurchase the car from the consumer.
Once the buyback occurs, the vehicle is tagged with a lemon title, and the manufacturer usually resells it. Buying a car with a lemon-branded title isn’t necessarily a bad thing as long as you know what you’re getting. Not all states require clear labeling for lemons, so look out for terms like “manufacturer repurchase.”
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Odometer Rollback Title
It was thought that when the auto industry switched from old-school analog odometers to digital ones, that odometer rollback would be a thing of the past. Unfortunately, the switchover has made this fraudulent activity even more possible. And this ability to dial back mileage while increasing a car’s value makes for an all too tempting activity.
All a swindler needs are a few simple electronic tools and basic programming knowledge. When this activity is uncovered, which isn’t easy to do, most states require the car’s title to be branded for an odometer rollback. Should you suspect a car’s odometer has been rolled back, have a mechanic check out the vehicle for clues about its actual mileage.
Water Damage Title
Every time you see floods hit a major city, vehicles with water damage follow. Water wreaks havoc on automobiles; moisture devastates the electronic systems in today’s cars and leads to body-destroying corrosion. Mold will also appear in the cabin, and, of course, engines were never designed to be submerged.
The worst part is that the water gets into inaccessible places making repair difficult, if not impossible. Water damage title branding is an essential consumer tool because flood-damaged cars can be shipped out of state to marketplaces that don’t usually deal with such vehicles.
Rebuilt Title
A title with rebuilt branding can be issued when a car with a salvage title has been repaired to roadworthy condition. While a substantial cost saving is appealing, this has to be weighed against the uncertainty of repair quality.
Do you know how thoroughly the repair work was performed? Have ALL the problems been fixed? It can be puzzling, and often the buying decision boils down to why the car was salvaged in the first place. For example, a body and frame may be fixable, but miles of water-logged circuitry could be beyond repair.
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Hail Damage Title
The numbers for hail damage in the U.S. are astounding. According to the Insurance Information Institute, there were over 4,600 major hail storms in 2020. Those softball-sized hailstones and their smaller cousins cost State Farm alone more than $3 billion in claims last year. As with other title branding, a hail damage designation offers an alert to consumers about a car’s condition. Hail-damaged vehicles can represent a bargain as often the damage is just skin deep. However, always assume hail damage extends below the surface and have the prospective car checked out by a mechanic.
According to CARFAX, the following states issue titles with specific branding for hail damage.
- Arizona
- District of Columbia
- Florida
- Idaho
- Kansas
- Kentucky
- Lousiana
- Maryland
- Mississippi
- Missouri
- Montana
- Nebraska
- New Hampshire
- Ohio
- Oklahoma
- Pennsylvania
- South Carolina
- Washington
- West Virginia
- Wisconsin
- Wyoming
Interestingly, the state with the most hail-damage claims, Texas, does not issue titles with hail-damage branding.
Look Out For Title Washing
Unfortunately, unscrupulous parties involved in the car business use the discrepancies in state title requirements to their advantage. It’s a practice known as title washing. For example, a branded title car gets retitled in another state with less stringent requirements. The new title appears clean, and the vehicle comes off as not having any bad history. Of course, the car now is worth more and is more appealing to buyers.
The best way to not be a victim of title washing is to check a car’s vehicle history report, such as from CARFAX or AutoCheck. These services do a good job of catching cross-border title branding conflicts. Reputable dealers will show history information to you, while you may have to pay for the report if you’re dealing with a private seller.
You now have answers to “what is a branded title on a car?” Keep this in mind during your car search.
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