Flood Damaged or Rebuilt Titled Vehicle......Anyone ever purchased?

[2kwik4u]

Wifes Traverse needs to be replaced. Vehicle is worth about $7k or so retail, and we're staring at about $5k in repairs needed, $3.5k in shop work and about another $1.5k in parts that I can do in the garage. Timing chain/tensioners/phasers, water pump, shocks/struts, brakes, and steering rack all have issues. It's little things we've been putting off that have accumulated. I can fix all the things except the timing chains, since a motor pull is required for that, and I don't have the space in the garage to get the body over the top of the motor.

SO, we've been on the prowl for something new that isn't going to break the bank. With me having the fullsize pickup we no longer need something that can tow, and we've determined we never really use the 3rd row seating that we bought the Traverse for anyway. Smaller vehicle is what we're looking for. She likes a small SUV since we have a one in a rear facing carseat, and another in a boost seat. We haven't ruled out a minivan, but the desire for AWD limits that field significantly.

Anywho, He mom has bought 3 cars from a dealership local to her in SE Missourri that sells rebuilt/salvaged title cars. Most are flood cars, rebuilt crashes, or theft recoveries that were otherwise totaled from an insurance standpoint. We're visiting this weekend and drove down there to check them out yesterday. There are a couple we're interested in, and the pricing is VERY attractive. The owner seems like a straight shooter and tells me they have a team of 3 guys running the place, and each vehicle is checked/repaired to like new before it's sold. He also tells me if the flooding is beyond the floorboard they pass on them, and if the crash requires more than straightening/body work they pass (no engine/trans damage, and no rollovers). We test drove a couple of the cars he had on the lot and honestly, I had a hard time determining they weren't "standard" used cars. The only tell tale sign I found in any of them was the residual "dirt" left from a flooding in the engine bay. The undercarriages, interiors, and body panels all looked "normal". He had a couple in the shop that he was in the process of "fixing up" that he let us look through. Carpets were out and being replaced. All electronics modules below the dash were inline to be replaced, and he had the fuel tank out of all of them as well. It really does appear to be a "stand up" operation he's running. To back that up he offers multi-year warranties on all the cars (for an extra cost of course).

SO, I have a few concerns about buying one.

Resell Value. We're essentially taking a risk and buying in cheap up front. $35k SUV for $20k cheap. But with that comes the premise that it's not going to be worth anything in 5 years after we've used it and it's time for another something. I haven't really run this scenario out all the way to see how that will affect us. Not sure how I feel about this one. We bought the Traverse for $22.5k 5yrs ago and it's worth $7k now. Not sure if that is buying the wrong model or just the way things go, but can we expect that same 70% value drop over 5yrs on a rebuilt?

Unseen issues......Now if they are really just flooded over the floorboard, or lightly hit and rebuilt the impact to driveline and electronics should be low. However, what if I miss something. Modern AWD vehicles have multiple differentials where fluid coul dbe water contaminated. Things like electronic steering are prevalent now. I'm certainly taking a risk on if those components will have a reduced service life on them. Then the question becomes, is the reduced service life going to impact me. Was it a 10yr part before and now it's a 7yr part that will still last our typical 5-6yr ownership? What else am I missing in here?

Insurance....How does insurance coverage change on a rebuilt title vehicle? If we crash it in the future is it repairable for a second/third time? Will I have an issue getting it repaired/covered by the insurance company? What about getting proper fixes vs 1/2 baked aftermarket parts because "it's already a a rebuilt title" mentality. I have an email out to me insurance agent now to hopefully answer some of these questions, but I'm curious what people here have experienced.

Lending....We don't have $30k sitting around to pay cash, so we're looking at financing. I have an email out to the bank as well to see what they think about the rebuilt title vehicles. I suspect so long as it's properly insured, including appropriate gap coverage then they shouldn't really care, but I'm sure there are rules around that.

The price and "value" seem deceivingly good on the surface. For instance we're looking at a 2017 Nissan Pathfinder Platinum for $23k. KBB puts it around $31k or so and I can't find any within 200mi for less than $29k. So we're saving $6k up front on that one. Despite not being an SUV she found a Fusion Titanium AWD with the Ecoboost engine and only 21k miles for $15k. Again, about $5-6k below the rest of the market it appears.

SO......with that novel length post. Anyone have an experience or recommendations? Did you or someone you know buy into this situation and have good luck? Bad luck? Thanks in advance!

 

[veedubtek]

I've bought/rebuilt probably 100+ salvage cars for one reason or another, and I've had pretty good success with them. I've also worked on a bunch that others have rebuilt, and been absolutely appalled by what I found. Each states laws are gonna be different, but in NC, anything newer than 7 model years gets a fairly thorough pre/post inspection. Older than that, it really doesn't get shit. I typically stay away from flood vehicles, but they can certainly be repaired correctly, it's just time consuming. Ask what they do for their flood cars - are they flushing all fluids? Cleaning/treating connectors? Also, the disparity in value in your 5 year scenario falls alot closer to each other. If it's a reputable place, I wouldn't be scared at all. I think you may have trouble getting collision coverage, I've heard that can be an issue before, but I usually buy cash and don't run collision. Financing presents a problem, but likely still doable.

 

[robert843]

Like @veedubtek I have bought a few salvage cars and bikes over the years most were just fine. Financing maybe tricky you will likely not get financing from your regular bank and if you find it I’m guessing it maybe at a higher rate but same as @veedubtek i have always paid cash for the salvage vehicles I bought so I’m not a good source of info there. Pricing honestly I have a rule I follow but everyone is different but my salvage rule is half price if I can buy the car for half of the value I will do it any more then that I pass. Residual value on salvage cars is probably worse then your traverse. In 5-6 years the car you are looking at is probably only going to be worth 4-5k with a salvage title. They are also tougher to re sell later many people won’t touch them and some dealers trade them which refers back to my half value rule. I have found when I only pay that the car becomes easier to sell because the price difference is so large compared to a non salvage vehicle. All that said I have no problem buying a salvage car just pricing and reselling them is tricky to not lose your tail.

 

[Beachbummer]

Verify you will be able to get insurance for the value you feel confortable financing...In addition to financing as mentioned above, this is the other area where comprehensive and collision insurance can be less than straightforward.

 

[2kwik4u]

Verify you will be able to get insurance for the value you feel confortable financing...In addition to financing as mentioned above, this is the other area where comprehensive and collision insurance can be less than straightforward.

I've email our insurance agent, and she's going to check on Monday. I included GAP insurance in the question to cover anything that the traditional collision/comprehensive coverage doesn't.

Thanks for the input from all so far. I'm both nervous at the potential issues, as well as excited about the potential savings. The mother-in-law is on her third purchase from this place, and the last two have taken her well over 200k miles without major problems, so there is clearly potential in the deal. Just never purchased anything except new or otherwise 1 owner cars as my daily driver. I've had plenty of other "side cars" that were 6+ owners, but if I have had to rely on it to get me to work it's been a bigger consideration.

 

[BigAbe75]

@2kwik4u Would you mind sharing the info on the vendor? PM if you prefer.

I wonder how some of these would compare to an offlease vehicle that doesn’t have many years, but a boatload of miles?

Oh, also in your planning, make sure you have a fairly concrete idea on your number of offspring. If there’s a chance that a third could come along, you’ll wish you had that 3rd row seat again.

We have a Tahoe and the wife really wants to move up to a Subarban, to get a little more storage behind the 3rd seat... now that we use it all the time.

 

[2kwik4u]

@2kwik4u Would you mind sharing the info on the vendor? PM if you prefer.

I wonder how some of these would compare to an offlease vehicle that doesn’t have many years, but a boatload of miles?

Oh, also in your planning, make sure you have a fairly concrete idea on your number of offspring. If there’s a chance that a third could come along, you’ll wish you had that 3rd row seat again.

We have a Tahoe and the wife really wants to move up to a Subarban, to get a little more storage behind the 3rd seat... now that we use it all the time.

Here is the link to the Pathfinder we looked at. He had it in 1000 pieces in the shop while we were there, so we got a good look at it. There was obvious dirt/silt in the engine bay, and some light rust on the gas/brake pedal assembly. The carpet was coming out and being replaced and the signs of water didn't show much above the floorboard, which corroborated his story that it came from a shallow flood in PA. Overall, you had to really look hard to find signs of it being in water. Clearly he's not just flipping them without disclosure or work, I'm just unsure how much work is the right amount.

https://www.recar.com/vehiclesDetail.php?102157

We've both been "fixed" so 2 kids is the max unless two doctors botched two procedures and the universe is just messing with us.

I'm also curious how the risk of a damaged and fixed vehicle compares to a late model high miles vehicle with a clean history. Certainly both take some life off the components but how much is very hard to quantify indeed.

 

[robert843]

As @BigAbe75 mentioned you can find good deals on clean title off lease cars. This one is not a platinum but a clean title with only 30,000 miles for $18,999. Offlease only has 91 pathfinders right now most under that 23,999 price point but once again none are a platinum if that’s important to you.

https://www.offleaseonly.com/mobile/pages/inventory/details.asp?vin=5N1DR2MN0HC668007&out-of-area=False

 

[2kwik4u]

As @BigAbe75 mentioned you can find good deals on clean title off lease cars. This one is not a platinum but a clean title with only 30,000 miles for $18,999. Offlease only has 91 pathfinders right now most under that 23,999 price point but once again none are a platinum if that’s important to you.

https://www.offleaseonly.com/mobile/pages/inventory/details.asp?vin=5N1DR2MN0HC668007&out-of-area=False

Had no idea that site existed. Thanks for the link.

The requirements for the new vehicle are SUV, AWD, and sunroof. She likes the "fancy" features but won't be upset if we find one without navigation or a heated steering wheel.

 

[gmtech16450yz]

You made it through owning what was one of GM's all time worst vehicles so anything you get should be better! There isn't a major component on the Traverse/Acadia/Enclave that doesn't have chronic problems. At 50k miles they're basically worn out junk. I wouldn't touch one used, in any condition or price. The sad part is that I think they're a really nice vehicle as far as design. Good size, good power and they drive nice and quiet. Owners love them, until they get their repair bills. Our dealership sold a ton, but the massive amount of repairs and recalls on them literally kept our dealership in business.

My point of saying this is the year and model makes a difference. Even the same models often go through era's of good and bad. If you were talking about a GM full size like the GMT900 series, I'd have far less problem buying one used/flooded/wrecked than say a vehicle like your Traverse. Sorry I can't help you on the Pathfinder though, I have no knowledge or experience with them.

 

[gmtech16450yz]

Hey two more things... Have a dealership run your VIN on that Traverse. There's a "Special Policy" warranty that covers the timing chain until 100k or 120k miles I think. If you can have the chains done for free, it might change your thoughts? You have to ask about it and have them run the VIN. Call your zone rep and you also might be able to get help on all of the repairs since they're all common, known issues that had multiple recalls. Just a thought.

"She needs a sunroof" Hahahahaha. Did the Traverse have a sunroof? Seeing that gave me flashbacks of all the Acadias and Enclaves I worked on that we called "Fishbowls" because they were FULL of water inside. They had a tiny little problem with leaking sunroofs. lol. If yours had a sunroof and it didn't leak I'd be shocked.

 

[2kwik4u]

@gmtech16450yz

Ours suprisingly doesn't leak. I've read about this stories before I bought and we passed on two that had obvious leakage. I hadn't read on the timing chain issues our we most likely would've passed on the model overall. I had an exceptionally great experience with our 2003 Yukon (180k great miles in that truck) and over trusted the oil life monitor in the Travese leading me to timing chain problems. I'm not as trusting in the OLM anymore and run full synthetic with 5k mileage as my interval in the Sierra (but that truck has a vibration issue as all K2 trucks seem to have)

Ive asked about the chain recall and being at 136k miles they say I'm too far over the 120k mile limit to help. Sucks really, it's not a terrible vehicle just worn out much sooner than I expected.

She found a Q5 in Indy that we might look at, but it's got 75k miles on it. Same engine architecture as the A4 we had, with an improved 8spd ZF trans. That A4 ran for 220k miles before a sensor in the transmission forced us to sell ($4k repair on a $5k car) since I couldn't find a rebuild manual for the automatic and nobody would rebuild it, just replace it.

We're attempting to keep budgets down so that $20k-$25k range is the target. Hard to find a gently used SUV in that range.

 

[gmtech16450yz]

Not surprise you got 180k out of that Yukon, some of the best vehicles GM ever built. Throw a fuel pump in them once or twice and they're good to go. On the OLM on the Traverse... fun fact... The original algorithm on them let them go to as high as 12k miles, even on break-in oil!!!!!! We had engines come in all the time with NO OIL but the OLM said 50% or whatever. Insane. Changing oil wouldn't have saved the chains though, they're just junk. It's also the horrible PCV system and the later Direct Injection that kills those 3.6 engines. Pull the intake hose in front of the throttle body off and you can pour out about a cup of engine oil. lol. If it's a DI engine, your intake valves are probably covered with handfuls of gunk clogging off the entire ports. What GM did with those vehicles was criminal. So many people paid way too much money trying to maintain them. They basically used the public to experiment on engine and oil life.