Q:

What are the risks of buying a vehicle from Insurance Auto Auctions USA?

A:

Quick Answer

Insurance Auto Auction USA sells vehicles with salvage titles, so buyers risk buying a car with hidden frame damage, non-functioning safety equipment, costly future repairs and low resale value. As of March 2015, most vehicles for sale by IAAUSA have been classified as "total loss" by an insurance company.

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Full Answer

Salvage titles are given for a variety of reasons, from cosmetic damage to full structural collapse. IAAUSA sells vehicles through live and online auction, with merchandise preview times before each event. If customers cannot attend the preview to inspect the vehicle, they risk purchasing a car with irreparable frame damage, broken safety equipment or repairs that cost more than the car. IAAUSA auctions vehicles as-is, so buyers have no recourse if the actual condition is different from the seller's description.

Vehicles with salvage titles can be difficult or impossible to resell, and most dealers will not accept salvage vehicles for trade-in. Buyers often need to keep the car forever or pay for disposal. Customers may also have trouble getting a full insurance policy on a total-loss car because of the uncertain safety status. Banks are often unwilling to provide loans for salvage vehicles, meaning that buyers must pay for the auctioned car out of pocket.

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