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Pasadena Service Federal Credit Union
mypsfcu.org | 877.297.4707January 2018
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Warning! Flood damaged cars coming to California and you probably won’t know it!

Greg KimuraWe’ve all seen the devastation from hurricane Harvey that pounded the Houston and Florida areas. Streets turned into rivers, homes flooded, neighborhoods destroyed beyond recognition and lives lost. A terrible tragedy! What hasn’t been talked about is the damage to over 1 million vehicles. So, what happens to these cars?

Here’s the process and it’s pretty scary:
  • Claim is made to the insurance company
  • Inspection is done and car deemed a total loss
  • Car is sent to an auction to liquidate
  • Car is sold and title is “Branded” as “Salvage”
  • Buyer takes car to a “Friendly” state and the title is “Washed” – the “Salvage” designation magically disappears!
  • Car is cleaned up, new parts put on and send to another state

The industry experts estimate that 70% of the flood damaged cars will have their titles “Washed” and resold to the public as a “good” used  car, without a Salvage Title.

What can you do to keep yourself from being taken?
  • Do a thorough check of the history of the car.  Carfax and Autocheck report don’t give you the full story.  Never buy a car based on only these reports.
  • Pay an expert to do a thorough check to insure the title hasn’t been “Washed”.
  • Read, read, read – learn about the process and get information from insiders.
  • Be extra, extra careful buying private party.  If you get a bad car, there is no recourse.
  • Avoid used car lots.  Most if not all of their inventory is “reject” cars from dealers or auctions.
  • Bring a good mechanic to check for signs of damage from a flood.
  • Use only trusted sources.
  • Ignore anything that seems too good to be true.
  • Don’t look for the cheapest cars out there.  There’s a reason why it’s cheap.

We don’t want you to get stuck with flood damaged car.  We feel it would be terrible for you to be stuck making payments on a car that you drastically overpaid and can make you sick or will break down.  We have an auto buying service that we hope you will use.  There’s no charge to you and it can make the difference between owning a good car vs a bad one.

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Disclaimer - All content contained in this newsletter is for informational purposes only and should not be relied upon to make any financial, accounting, tax, legal or other related decisions. Each person must consider his or her objectives, risk tolerances and level of comfort when making financial decisions and should consult a competent professional advisor prior to making any such decisions. Any opinions expressed through the content in this newsletter are the opinions of the particular author only.  
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