If your insurance company has declared your vehicle a total loss, it usually signals the end of that car’s use. But can you sell a car after a total loss? It’s kind of a confusing situation, which is why the Law Offices of Jacob Emrani have made this handy guide. Understanding what happens after a total loss declaration and whether you can still sell your vehicle is crucial for making informed decisions that protect your financial interests.
What Does “Total Loss” Mean in California?
A total loss in California means the insurance company has determined that the cost of repairing the vehicle exceeds the car’s cash value. This could be due to a car accident. In California, insurance companies typically use a threshold of 75–80% of the vehicle’s pre-accident value.
It’s important to know that a “total loss” doesn’t necessarily mean your car is destroyed or undrivable. Many totaled vehicles have enormous cosmetic damage but remain mechanically drivable. A lawyer like Jacob Emrani can also help you if you want to dispute your car’s value in a total loss claim.
Can You Sell a Car After It’s Declared a Total Loss?
Yes, you can, but it’s different from selling a standard vehicle. The California Department of Motor Vehicles assigns a salvage value to a totaled car. This permanently marks the vehicle’s history and affects its marketability and resale value.
Selling a totaled car in California depends on which path you choose after the total loss declaration. If you accept the insurance settlement and surrender the vehicle to them, they take ownership, and you cannot sell it. Most insurance companies sell it at salvage auctions. But if you decide to keep it, you have the right to sell it yourself.
Can You Keep Your Totaled Car After Insurance Pays Out?
Total loss vehicle laws in California allow you to keep your totaled vehicle after receiving an insurance settlement, but the payout amount will be reduced. This process is called owner-retained salvage settlement. Your insurance company will calculate the vehicle’s actual cash value and subtract the salvage value (the amount they could receive for the car at auction).
You receive the difference as your settlement, and you retain the damaged vehicle and its salvage title. If your cash value is $10,000 and the salvage value is $3,000, you would receive $7,000. This option makes the most sense if you want to keep the vehicle and have it repaired.
Before choosing this route, note that you’ll need to obtain a salvage certificate from the California DMV if you plan to drive the car again. It must also pass a brake and light inspection.
How To Sell a Car With a Salvage Title in California
To sell a vehicle with a salvage title, you must comply with the salvage title California rules by disclosing the salvage title status to potential buyers. Failing to do so can result in legal consequences and accusations of fraud.
To then sell the car, follow these steps:
- Step one: Obtain the salvage title from the DMV.
- Step two: Price the vehicle. These cars typically sell for 20–40% less than comparable vehicles with clean titles.
- Step three: When you find a buyer, complete a Notice of Transfer and Release of Liability and provide the salvage certificate to the new owner.
A salvage vehicle title can be “revived” once the car is repaired and passes inspection.
Who Buys Totaled or Salvage Vehicles?
Salvage yards and auto recyclers purchase totaled cars to sell their components. They’re typically interested in vehicles with valuable parts, even if the car isn’t repairable. Junkyards offer quick cash purchases with minimal hassle but usually offer the lowest prices.
Auto mechanics look for salvage vehicles they can repair and resell or use personally. These buyers have the skills and resources to handle extensive repairs cost-effectively and may offer better prices than salvage yards, especially for cars with repairable damage.
Benefits and Risks of Selling a Totaled Vehicle
The primary benefit is financial. You may receive more money by keeping the salvage value and selling the car yourself, particularly if the vehicle has valuable components or is repairable. You control the process and timeline, and if the vehicle is drivable or repairable, you can fix it for personal use.
Selling a salvage vehicle takes more time and effort than accepting the insurance settlement. You’ll need to handle DMV paperwork, find buyers willing to purchase a salvage title vehicle, and potentially deal with lowball offers. There’s also the possibility you won’t find a buyer willing to pay more than the salvage value, leaving you with a vehicle you can’t sell and no insurance payout.
How Insurance Settlements Work for Total Loss Cars
If you’re still making payments on the car, the insurance settlement will be applied to your lender first. You will be liable for the difference if your debt exceeds the car’s value unless you have gap insurance.
California law requires insurers to settle claims promptly once liability and damages are determined. If you’re unsatisfied with your settlement, you have the right to dispute it by providing evidence of your vehicle’s higher value, such as recent comparable sales or documentation of upgrades. A good way to do this is by double-checking your car’s value on Kelly Blue Book.
When To Contact a Car Accident Lawyer
Certain situations involving total-loss vehicles warrant consulting an expert car accident lawyer in Los Angeles, such as Jacob Emrani.
Should another driver cause the accident that totaled your car, you could receive additional compensation beyond your insurance settlement. An attorney will help you pursue a claim against the person at fault for the full value of your vehicle, including compensation if the settlement doesn’t cover your remaining loan balance.
Legal representation becomes particularly important when insurance companies dispute liability, offer unreasonably low settlements, or delay payment without justification. You should also consider legal help from Jacob Emrani if you suffered injuries in the accident. A personal injury claim addresses not just property damage but also your medical expenses, lost wages, pain and suffering, and other damages.
Call on Jacob Emrani for Any Personal Injury Claim
Selling a car after it’s been declared a total loss is not only possible but can sometimes be financially advantageous. Whether you choose to keep your salvage vehicle and sell it privately or accept the insurance settlement depends on your circumstances, the vehicle’s condition, and your willingness to navigate the salvage title process. But if you are subject to any medical injuries from an accident, Jacob Emrani will fight for your property damage, medical expenses, and anything else. Call on us today.