stupid purchase - legal advice needed!

After this post, I'm going to have to change my screen name - I'll be too embarrassed to keep it! I bought a car this evening, private party sale. Looked great, test drove it three times over two days, decent records, Pretty good (not amazing) price. ~ 20% below edmunds private sale number. Car was described to me as "recovered theft" - I was led to believe that the car had been stolen for a few days and suffered very minor damage to the rear qrt. Careful examination shows very, very minor fiberglass to the area. I've restored cars in the past and trusted myself to examine area. I convinced myself that the price deduction is worth the recover theft blemish - resale isn't important too me. Now I get the paperwork home - NY title, in small print near the bottom says "Rebuilt Salvage/PA" I immediately assume this means the car was totaled - I call the seller who says theft recovery is accurate but the titles will always say rebuilt title. He strongly resists reversing the hour old deal. The owner (a phamasist) had the vehicle for two years and put 40K miles on car; I don't think he's flipping cars for a living. I got a hold of my porsche dealer as he was locking up. Dealer says car may not have been totaled, or even damaged. According to dealer, if insurance company pays off car because it isn't immediately recovered, then they have to sell it as "Junk" and this results in a salvage title. I re-examine car in my garage - I find no further signs of damage. Anyway - the above is for your amusement (Scott's at it again guys). Does anyone know if there is a grace period on contracts between private individuals? My laywer's not picking up his cell phone and if I do have a 24 hour grace, I'll want to get something notarized tomorrow. If not, I'll probably just enjoy the car - stress isn't good for anyone! (I will still be changing my screen name though!!!

Here in Ca. there is no "recission" a salvage title means anything from complete.......rebuild....too something as mundane ......has a theft recovery. If the car was recovered after 30 days, and only the seats were missing....it becomes a "salvaged" car same goes for a "lemon" car....the problem could have been a bad abs sensor, that the dealer could not fix on 3 attempts(CA law)...bingo...car becomes a "lemon"car...due to at faulty abs sensor.....or inabilty of dealer to fix car! Did the PPI you had performed show any damage??? I guess my confussion arises from your " Pretty good (not amazing) price. ~ 20% below edmunds private sale number."......If you were not happy with the price.....why write the check?????

I was "happy with price" when under the impression car was a simple theft recovery. I.e - price was good thinking car had been someone's joyride for a "couple of days." I'd be unhappy if it turns up that the car had been totaled to the tune of 75% or more of it's value. My research over the night confirms what you said - the title's description is vague - it could have been either case... The inspection showed no damage (other than a repaired quarter panel) and I'd find it hard to believe that a "totaled" car could be repaired to the extent that the repair would be invisible. I'm having someone come out and look at the car again this morning at my house to specifically look at frame, etc... But at this point, if New York also has no recission, I guess the inspection will just give me peace of mind at highway speeds. Thanks for the info Phil.

Generally, Scott, there is no right of "recission" for a deal between two individuals (non-businesses). You might have a remedy in a claim for fraud if the "salvage" title wasn't disclosed prior to the execution of the deal, but it would likely be a fair bit of effort unless the seller collapses at the very hint of a lawsuit. The argument would be that he had an obligation to disclose. Laws will vary from state to state, however, so consult your lawyer when he/she picks up the cellphone. As for the title, it's quite common (again, jurisdiction dependent) for states to mandate the issuance of a "salvage/rebuilt" title for a car that had been stolen and not recovered within a minimum amount of time, even if the car has not been damaged in any way. As to value... ask yourself this question - you were relatively happy with the selling price BEFORE you found out about the salvage title, so how much would you have offered if you knew about it before the sale? This would be the basis of your claim against the seller. General rule of thumb, a salvage title is usually a ~40% discount to fair market value. Less of a discount if the car isn't damaged-then-repaired, but certainly significant. Lastly, check with your state's DMV and insurance agent. Some states do not allow certain types of coverage (comprehensive, collision or both; liability only) for cars with salvage titles. Good luck! vty, --Dennis

"Lastly, check with your state's DMV and insurance agent. Some states do not allow certain types of coverage (comprehensive, collision or both; liability only) for cars with salvage titles." yes, and many manufacturers will deny warranty coverage on salvaged cars as well. 20% discount is not enough for the buyer IMO.

i wouldn't worry about the car having problems if you and the guys you're having inspect the car don't find anything. i had a car stolen that then got a salvage title, and all that had been done to it was that the steering wheel cover had been taken off and a screwdriver shoved into the ignition to start it. other than that, no damage was done, and even though the car was recovered inside of 30 days, it still had a salvage title.

That's a bummer...hope everything turns out OK.

It may be difficult to find an insurance company even willing to insure the vehicle once they determine it to be a "salvage." Jim

What struck me as wierd was your reference to fiberglass? Fiberglass is not an acceptable modern bodyshop procedure to repair any kind of collision damage under any circumstances.

I would just be happy with the car... even if you were legally able to rescind the contract (which you can't, unless there was fraud), the legal fees would be too high to justify pursuing it.

To the person formerly known as Scott5: You could probably research some police files in the locale of the seller, to find out how bad the stolen car issue was. There "may" be a police report available. Then you could make an educated decision whether to keep the car or hang the bast**d..

Is the average person to know that "theft recovery" means the car comes with a salvage title? I didn't know that. I've had 2 cars stolen and recovered, but since the insurance did no more than pay the repair costs, I had no salvage title. Since the price of this misunderstnading is at least 20% of the purchase consideration ( estimate @ $35,000 so the economic loss is about $7,000), I'd be inclined to invest a few thousand in attorney fees to rescind the sale or gain a $7,000 rebate from the seller. You'll never be whole on this deal at your resale unless there is rectification. Just filing suit will probably result in a settlement offer equal to the amount of the anticipated defense. If the seller had said "salvage title" at any time, I'd retract everything I just said. AS

a salvage title should have no effect on your car's insurability or your insurance rate. the only thing i'd worry about is the resale value, but you already said you don't care about that. i think you got a good deal then.

yeah, that sounds pretty weird to me too unless you're talking about one of the bumpers.

"a salvage title should have no effect on your car's insurability or your insurance rate. the only thing i'd worry about is the resale value, but you already said you don't care about that. i think you got a good deal" Tell this guy he should have no trouble insuring a salvaged vehicle. You would find many more examples if you looked. then. http://www.audifans.com/archives/1999/05/msg00668.html

Thanks folks - ok - get this - Guy didn't sign the back of the title. I'm not sure if this is good or bad for me. I do have sales slip with his signature confirming receipt of my bank check for said car, and even though the car's in my driveway, I'm wondering if this means he didn't really "deliver" the goods yet. Does that have any bearing on the situation or give me any leverage? He's not returning calls. I'll give him until tomarrow and then pay him a visit. ps: I misspoke on the fiberglass comment - I was speaking boats, now cars.

I'm a New York lawyer and the seller's failure to sign the back of the title certificate means that he hasn't transferred title to you, although he has your money. The NY DMV will not register the car without the signed title. Since he hasn't performed his part of the bargain you could rescind the sale and demand your money back, but you're probably looking at a litigation with the unregistered car sitting in your driveway for the duration. With respect to registering in NY, I suggest you check the DMV's website www.nysdmv.com. Under "Find Answers" (at bottom of home page) put in "salvage" and you'll be directed to a page that discusses separate safety investigation that must be done by DMV before a vehicle with an out of state salvage title can be registered.

Like I said earlier in this thread, please check with your local insurance agent or DMV. Rules vary from state to state. I am absolutely certain that there are states which do not allow for certain types of insurance coverage on salvage-titled vehicles, whether the insurance company in question is willing to provide coverage or not. I do not know what NY law allows. Keep in mind that when selling your salvage-titled vehicle, this will limit the market of potential buyers; those residing in states with this insurance limitation will not be able to buy your car, not matter how good of a discount you're willing to provide. vty, --Dennis .

my experience with insuring a salvaged car was in NY and i didn't have any problems at all. i used state farm and they insured it just like any other vehicle, no differences at all.

regarding insurability - I'm ok - according to my statefarm agent, a salvage title is not treated any differently than a clean title. I know that in some other states, they do limit the type of insurance you can get - and possibly some states won't provide for insurance at all. But in NY, I'm ok. Thanks everyone...

The end result!!! - I spoke with seller this morning. Speed's info regarding the unsigned title was critical to me; I had the confidence to pursue a resolution that benifited me. Seller and I are meeting tonight- he's going to give me a bank check that nets the sales price of the car down towards the 40% off mark and I'm going to let him sign the title ending this mess. He's happy, I'm happy... Thanks for the advice guys - it really helped. Scott

Very interesting thread. Scott May I ask what you bought and what you picked it up for? I am very happy for you that must have been a nerve racking couple of days. It sounds like the oversight saved your butt! It is funny how things like this ultimatley work out! Congrats on the new purchase!

Be very careful when rescinding the transaction (I would do the same, by the way). A former client who was a car dealer had a habit of allowing buyers to rescind such contracts. He would write hot checks for the returned funds and retain the vehicle. I would have the seller send a copy of the bank check in advance so that you could verify its authenticity. Good luck. Jim

There was just an article in Sports Car Market magazine explaining private sale disclosure requirements. The attorney who wrote it says that the law requires private sellers to disclose information about a vehicle when such knowledge would effect the value or influence the purchase. This is especially true if the defect is not readily detectable. I think a title branding would fall under this statute. I am glad Scott's situation is being resolved. The law does seem to justify his position.

Scott: Did you check the DMV website about getting a salvage vehicle inspected so that it can be registered? I wouldn't complete the transaction unless I was sure the car could be registered in NY.