Car Title Fraud

Car Title FraudCar title fraud, the act of deliberately misrepresenting the title history of a vehicle, occurs more often than it should.

Whenever a vehicle is severely damaged in an accident or by a natural disaster, or stripped of its parts, it is given a new title that includes the type of damage the vehicle sustained. Then it is often sold at an insurance auction.

If you purchase your car at an insurance auction and the following happens, you have become a victim of car title fraud:

The car is often purchased at a “too good to be true” price because of the car’s damaged history. Known as “title washing,” the purchaser re-registers the car in a state that does not recognize the branded title as salvaged. The purchaser of the damaged car which has now a clean title then sells the damaged car to an unsuspecting buyer and makes a profit. The unfortunate result is a car that is more prone to problems and being a danger on the road because of its damaged past and the new driver could be out of a lot of money when the car breaks down shortly after purchase.

The federal government is currently in the process of stepping in and mandating what is considered a salvaged car so that there isn’t a discrepancy between states. Until then, if your car was manufactured after 1981, you can perform a car title history check by inspecting the vehicle identification number. Familiarize yourself with car title fraud by doing some research on various websites pertaining to the subject.

Car title fraud is not only financially dangerous for the victim, but by driving an incompetent car, you are putting other drivers on the road at risk. If you plan on buying a used car, be sure to do all of the extensive research you are capable of doing to avoid falling victim to car title fraud.