The Complete Guide To Buying and Insuring a Car With a Rebuilt Title

February 28, 2024

When shopping around for a used automobile, you need to consider aspects like the original damages, the outcome of the initial inspection, and – no less importantly – the insurance coverage you can and can’t use with the car in question.

Read on to learn everything you need to know about rebuilt title cars, relevant insurance policies, and the viability of buying a car that has been severely damaged.

The Rebuilt Title Meaning Explained

A rebuilt title means that the car was in a severe accident and had to be repaired and restored to its driving state. Most rebuilt title automobiles previously had a salvage title indicating that their repair cost after the accident exceeded their market value.

Besides road accidents, a car can be estimated as a total loss after hurricanes, vandalism, hail, or tornados, among other qualifying events. More often than not, a damaged car is totaled out by the insurance provider and sent to be scrapped for spare parts. Alternatively, it can be sold to repair shops and reconstructed.

Once the repaired car is determined safe to drive, its status changes to the rebuilt title. That said, its salvage status is here to stay. The record will never be clean again, which you should consider if you want to buy such a vehicle.The good news is that buying a reconstructed title car can save you up to 40% of its value. However, it’s up to the driver to determine whether the game is worth the candle depending on how the car will be used, the driver’s risk tolerance, and other factors.

Rebuilt Title Rules in Different U.S. States

Depending on the U.S. state, the rules and regulations for a rebuilt title can significantly differ.

Here’s a list of documents required when applying for a rebuilt title in different states:

State

Regulations

Florida

  1. Completed application for Certificate of Title (Form HSMV 82040).
  2. Statement of Builder (Form HSMV 84490).
  3. Statement of Builder additional sheets, if necessary (Form HSMV 84491).
  4. Original Florida title (or duplicate title if the original is lost) or out-of-state title.
  5. Proof of ownership documents – bill of sale or any other.
  6. Receipts or bills of sale for all major component parts.
  7. Photographs of the car before repairs.
  8. Inspection fee and Florida sales tax.

North Carolina

  1. Original certificate of title.
  2. Bill of sale for the vehicle.
  3. Copy of the salvage application (Form MVR-4A).
  4. Valid driver’s license or state-issued ID.
  5. Proof of property tax payment.

Ohio

  1. Application(s) for Certificate of Title to a Motor Vehicle (Form BMV 3774).
  2. The salvage title.
  3. Vehicle inspection certificate.
  4. Local county titling fees.

Texas

  1. Certificate of title for the vehicle.
  2. Application for Texas Title and/or Registration (Form 130-U).
  3. Rebuilt Vehicle Statement (VTR-61) with detailed information about the car’s repairs and the entity performing the repairs.
  4. Vehicle inspection report.
  5. Photo ID.
  6. Proof of auto insurance.

Indiana

  1. Proof of vehicle ownership.
  2. Application for Certificate of Title for a Vehicle.
  3. Affidavit of Rebuilt Vehicle.
  4. Proof of purchase or ownership for major parts used in repairs or a completed Affidavit State Form 37964 for each part.
  5. Completed Odometer Disclosure Statement (if the vehicle changes ownership).
  6. Proof of address.
  7. Payment of tax if selling the vehicle or completed exemption.
  8. Title application fee.

Illinois

  1. Salvage certificate in the name of a licensed rebuilder.
  2. Completed rebuilt title application.
  3. Salvage affirmation listing the parts used in the rebuild.
  4. Invoices for parts used in the repairs.
  5. Valid driver’s license.
  6. IDOT vehicle inspection report and sticker.

Michigan

  1. Completed TR13-A form for inspection of a salvage vehicle.
  2. Completed TR13-B form for salvage recertification.
  3. The salvage title.

Colorado

  1. Salvage title with a completed and signed form.
  2. Secure and verifiable identification (SVID).
  3. Forms DR-2424, DR-2704, and DR-2173.
  4. Receipts for all major parts.
  5. Emissions compliance certificate if required.
  6. Payment for applicable fees: Inspection, Title, Registration, Vehicle license tax (VLT), and Air-quality research fee.

Oregon

  1. Completed Application for Title and Registration.
  2. Salvage title or original title.
  3. Receipts or permits for used parts.
  4. Invoices from previous owners.
  5. Original lien releases from prior security interest holders.
  6. Assembled, Reconstructed, or Replica Certification.
  7. Vehicle identification number (VIN) inspection.
  8. Appropriate titling fee based on the vehicle.

Arizona

  1. Completed Registration Application and Title (Form 96-0236).
  2. Original salvage title.
  3. All required vehicle inspection documents.
  4. Emissions compliance certificate if necessary.
  5. Payment of all applicable fees: Inspection, Title, Registration, Vehicle license tax (VLT), and Air-quality research fee.

Alabama

  1. Salvage title.
  2. Form INV 26-15 – Application for Inspection of a Salvage Vehicle and Affirmation Supporting Salvage Certificate.
  3. A notarized bill of sale for the car.
  4. Bills of sale for any major components you had to add to the car for repair.
  5. Copy of the vehicle registration (for the original owner) or a copy of the rebuilder’s license (for the new owner).
  6. Form INV 31-1) – Inspection Application Remittance Advice.
  7. Payment of applicable fees for titling and inspection.
  8. Check for the fee for each application processed.

New York

  1. Proof of identity.
  2. Original proof of ownership.
  3. Original bill of sale (if applicable).
  4. Sales tax receipt (follow the instructions on Form FS-6T).
  5. Original lien/lien release (if applicable).

Tennessee

  1. The vehicle’s title.
  2. A completed and notarized Form RV-F1315401 – Application for Motor Vehicle Identification Certification.
  3. A completed and notarized Form RV-F1311001 – General Affidavit (if you hired someone to perform your rebuild).
  4. Full-color photos of the vehicle both before and after repairs were made.
  5. All receipts, bills of sale, and/or invoices for replacement parts.
  6. Check or money order for the rebuilt title fee.

Georgia

  1. The car’s salvage title (in your name)
  2. Licensed rebuilder certification
  3. Photographs of the salvaged vehicle.
  4. A completed Form T-22R Request for Inspection of a Rebuilt Motor Vehicle.
  5. A completed Form T-129 Labor and Parts Certification, including details of the repairs made to the car and receipts for parts.
  6. Inspection certificate.

Pennsylvania

  1. The salve vehicle title.
  2. A completed Form MV-426B – Application for Reconstructed Vehicle, Specially Constructed Vehicle, Collectible, Modified, Flood, Recovered Theft Vehicles, and Street Rods.
  3. Clear color photos of the front, back, and sides of the vehicle.
  4. Paid fee for title registration.

Oklahoma

  1. The salvage certificate, or
  2. Form 780-B – a comparable proof of ownership document with an Unobtainable Ownership Documentation affidavit.
  3. A completed Form 788-B – Rebuilt Vehicle Inspection Request.
  4. Receipts for all parts used in the rebuild.
  5. Vehicle Identification Number (VIN) and/or the car’s serial number.
  6. Paid title fee and inspection fee (if applicable).

Washington state

  1. A Washington State Patrol Inspection Request, completed by a licensing agent.
  2. Valid ID.
  3. Original and salvage titles.
  4. Any receipts for repairs performed on the vehicle.
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As you can see, the list of documents can vary significantly in each state. For example, they may require photographs of the car from all angles. As a future owner of a car with a rebuilt title, make sure to study the requirements of the state where you wish to receive the status.

Insurance Companies That Cover Rebuilt Title

It’s worth knowing that some insurance companies are willing to cover the expenses associated with a rebuilt title in the United States.

Here’s the list of documents that may be required to cover your rebuilt title expenses:

Company

Documents

GEICO

  1. Initial repair estimate, including detailed information about the car’s damages and repair costs.
  2. Photos of the car before and after repairs.
  3. Confirmation statement from a certified specialist that your car is in working condition.
  4. Vehicle Identification Number (VIN).
  5. A copy of your rebuilt title issued by the DMV.

State Farm

  1. Repair estimate specifying damages.
  2. Statement from a certified mechanic confirming the working condition of your car.
  3. Photos of the vehicle.

Allstate

Allstate insurance does not cover vehicles with rebuilt titles.

Progressive

  1. Mechanic’s inspection.
  2. Detailed photos of the car.
  3. The original repair estimate, including the damages fixed.

USAA

  1. Mechanic’s inspection.
  2. Detailed photos of the car.
  3. The original repair estimate, including the damages fixed.

Farm Bureau

  1. Mechanic’s inspection.
  2. Detailed photos of the car.
  3. The original repair estimate, including the damages fixed.

On top of that, insurance company reps can answer all kinds of questions about a rebuilt title, from the basic “How do rebuilt titles work?” to more complex ones like “how to value a car with a rebuilt title.” They can also give you an idea of the rebuilt title insurance cost and whether you need it at all.

Rebuilt Title VS. Salvage Title

Cars with rebuilt or salvage titles have suffered significant damage, and replacing them was more cost-effective than repairing them. The difference between these terms is that a car with a salvage title was not repaired, while a car with a rebuilt title underwent repairs.

In other words, a salvage car is not eligible for insurance and legal road use. However, if you repair such a car, you can obtain a rebuilt title, confirming its insurability. This status also complies with your state’s requirements for the car’s roadworthiness.

So, does a rebuilt title affect insurance?

Here you go:

Type of title

Full coverage

Liability only

Drive on roads

Salvage title

No

No

No

Rebuilt title

Sometimes

Usually

Yes

Are These Cars Worth Buying?

There is a perception amongst auto enthusiasts that buying a reconstructed vehicle is an unequivocally poor investment. Yes, there are specific gains and losses when purchasing a rebuilt title car. And while there are numerous reasons to consider this purchase, it mostly depends on the individual situation.

Let’s face it: it can be a very lucrative deal. The buyer, however, should stay extra cautious and double-check everything. It might seem like a drawback regarding time and effort, but better safe than sorry.

Here are the most common concerns and issues you must address before selling or buying a vehicle with a rebuilt title:

complete-guide-to-buying-a-car-with-a-rebuilt-title

Infographic “Crash Course: A Complete Guide To Buying Cars With Rebuilt Titles”

Questions Most Buyers Ask Before Making a Final Decision

What most drivers care about is long-term safety. However, buying a vehicle with a rebuilt title tends to raise doubts about the quality, external wear, and manufacturing defects. 

Ask the following questions before acquiring rebuilt vehicles:

  • Under what circumstances was the automobile ruined or damaged?
  • How significant was the destruction?
  • How and when was the car reconstructed?
  • Is the frame correctly aligned?
  • Who examined the automobile?
  • When did the checkup take place?
  • Can your insurance provider grant traditional coverage options for the restored vehicle?
  • Can you get full coverage on a rebuilt title car?

Pros and Cons of Buying a Car With a Rebuilt Title

When making a decision to purchase, keep in mind that a rebuilt title has its pros and cons.

Pros

  • Buyers can save up to 40% of the car’s original price
  • You can find a restored automobile with minimal harm before the reconstruction

Cons

  • A chance to overlook critical damage before the deal is officially closed
  • The auto might require additional repairs
  • Insuring a reconstructed auto can be challenging and tricky

Should You Buy or Steer Clear of Rebuilt Cars?

With all the pros and cons of buying a branded title car, it is wise to keep searching for the best offer in the market until you find what fits your budget and risk tolerance. In some cases, buying a car with a rebuilt engine might be a better choice.Likewise, buying a car with a branded title can be your golden ticket if you own a car repair shop and look for high-quality car parts. But bear in mind that the decision is always individual.

Getting Car Insurance for Salvage or Rebuilt Title Vehicles

Buying car title insurance is always about the nature of the damage. For example, if the car suffered more or less cosmetic damage, it’s likely safe to take it out for a drive again after the repair.

However, some damages, such as those caused by floods, can cause lasting consequences while being indistinguishable on the spot. For drivers, it means purchasing insurance for a reconstructed vehicle is complicated.

For an insurance provider, a rebuilt title represents increased risks and potential mechanical issues. And yet, most states require minimum coverage, so buyers need to find carriers willing to provide policies for reconstructed cars.

If you already have an active policy and want to buy a rebuilt auto, your coverage might not extend. Finding a provider eager to write a policy for the automobile with a rebuilt title will require additional tests and checkups.

A Complete Guide to Buying a Car With a Rebuilt Title - want to buy a rebuilt auto

Why It Is Important To Get a Second Opinion

Understanding how to value rebuilt title cars is crucial. It is not enough to examine a vehicle once. Everything, including the documentation, might seem legit at first, but the goal is to ensure an auto you plan to buy is worth the risk.

You need to find a trustworthy car shop and check the automobile once again. The exterior might not cause doubts, but a car might require additional repairs and maintenance.

Experience matters, and the best way to get the car checked is to find a mechanic with a solid background in handling cars with rebuilt status. Otherwise, you might miss some of the technical problems.

Make Sure That Your Auto Is Not a Lemon

Besides asking questions and getting a second opinion, buyers must look out for other critical signs. It is no secret that the repairs are not always made properly. 

Here is what you can do to check the maintenance quality yourself:

  • Double-check if the panels are perfectly aligned
  • Carefully examine the paint colour
  • Check for fuel lines beneath the auto
  • Open and close all the doors and a trunk several times
  • Check all the warning lights on the panel, including the airbag warning light

If you detect any of these issues, we recommend thinking twice about buying the car. The flaws might be too severe for the vehicle to serve its purpose.

Frequently Asked Questions

What does a rebuilt title mean?

A rebuilt title is given to a car that has undergone severe damage and was repaired to a roadworthy state. The rebuilt title car value is up to 40% lower than the original price of the car.

How does an auto get a rebuilt title?

It depends on the state’s procedures. The most appropriate way to determine how your car can get the title is to contact the state Bureau of Motor Vehicles.

How can I make sure that the car with a restored title is worth buying?

You first need to check the accident history that was initially granted a salvage status. Then, you must request the documentation and find out who did the repair and restoration work. Even if the mechanic has positive reviews, consider getting a second opinion, as it can help you understand precisely what you are dealing with.

Does the title affect your insurance options?

You cannot access the same number of policies if you own a restored title auto. It can be relatively easy to get liability coverage. As for traditional options, it depends on the provider. Owners typically have to look for the ones willing to cover vehicles with rebuilt titles.

Is selling a car with a rebuilt title worth it?

Selling rebuilt title cars can still be profitable, especially if your perceived risk of keeping such a vehicle is high. Likewise, selling a rebuilt title car can be an effective way to tap into potential car buyers who don’t have a budget for new cars.

What is a reconstructed title?

A reconstructed title, or a reconstructed vehicle, is the same as a rebuilt title car. Some states use the “reconstructed” word, whereas other states use the “rebuilt” alternative.

Victoria Berezhetska

Victoria Berezhetska is a Content Lead at Phonexa.com and an expert contributor to CoverExplore. She has a Bachelor of Science degree in Business Administration, with extensive working experience as a PR specialist and content writer. At CoverExplore, she helps customers find the right educational material through easily digestible blog posts and buying guides backing their insurance coverage choice. Victoria covers diverse topics around digital and insurance marketing, including auto, home, health, and life insurance.

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