Buying Tips

How To Avoid Buying a Flood-Damaged Car

Vehicles damaged by floodwaters can put an unsuspecting buyer through the ringer. Sometimes these flood-damaged cars are refurbished — a process called title washing — as their titles are changed and the vehicles sold to unsuspecting buyers in distant states. Electrical and mechanical problems can surface later — long after the seller is gone — leaving the new owner with no recourse.

With floods in the Midwest and frequent hurricanes along the Gulf Coast, there are quite a few of these cases causing headaches for consumers. After Hurricane Katrina in 2005, Automotive News estimated that some 200 dealerships across Alabama, Louisiana and Mississippi were damaged or destroyed, and Carfax reported that well over 500,000 cars were likely affected.

When compared to Hurricane Katrina, the 2008 Midwest floods resulted in fewer damaged vehicles, but the estimates still ranged in the hundreds of thousands of dollars.

"The saving grace of the vehicles was the predictability of the floodwaters," said Larry Gamache, communications director for Carfax.

Gamache estimates that more than half of the vehicles given a salvage title are resold. He also said that states unaffected by the disaster are more susceptible to having flooded cars.

"Flood-damaged cars end up going to places where consumers don't suspect it," said Gamache. "But as the con men get smarter, we get smarter on how we deter it."

Before buying a car, a shopper should order a vehicle's history report, which will detail a vehicle's past, including the states it has been registered in, said Philip Reed, senior consumer advice editor at Edmunds.com. However, Reed warns that sellers can still conceal a vehicle's history by moving it through multiple states with differing regulations.

A good starting point would be the VINCheck service from the National Insurance Crime Bureau. This free service will tell you if a vehicle is in their flood database, if it was stolen but not recovered, or if it has been issued a salvage title. VINCheck will only give you those basic pieces of information, but it should be enough for most people to determine if they want to move forward. If you already bought the car or if you want more comprehensive information, you can get a Carfax vehicle history report for about $30.

In some states a salvage title is required when a car's value has depreciated by 50-90 percent. But the majority of states let the insurance company make that determination, so a flooded car could get a clean title in one of those states.

Fortunately, a little checking around can prevent you from getting hooked by a fishy deal. Here are six tips, selected from the National Automobile Dealers Association that will minimize your risk:

1. Get a vehicle history report. Although it won't uncover every flood-damaged car, history reports tag a fair number of problems. Services such as Carfax or AutoCheck can run reports electronically for an individual car, or multiple cars during a one-month subscription. All you need is your prospective car's vehicle identification number (VIN), usually located at the bottom of the windshield on the driver side. If you need help deciding which vehicle history report is right for you, click here.



2. Be alert to unusual odors. Musty or moldy odors inside the car are a sign of mildew buildup from prolonged exposure to water. It might be coming from an area the seller is unable to completely clean. Beware of a strong air freshener or cleaning solution scent, as it may indicate the seller is trying to cover something up.



3. Look for discolored carpeting. Large stains or differences in color between lower and upper upholstery sections may indicate that standing water was in the vehicle. A used car with brand-new upholstery is also a warning sign, as a seller may have tried to remove the flood-damaged upholstery altogether.



4. Examine the exterior for water buildup. This may include fogging inside headlamps or taillights and damp or muddy areas where water naturally pools, such as overhangs inside the wheelwell.



5. Inspect the undercarriage. Look for evidence of rust and flaking metal that would not normally be associated with late-model vehicles.



6. Be suspicious of dirt buildup in unusual areas. These include areas such as around the seat tracks or the upper carpeting under the glove compartment. Have an independent mechanic look for caked mud or grit in alternator crevices, behind wiring harnesses and around the small recesses of starter motors, power steering pumps and relays.