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Carfax Reports Record Amounts of Title "Washing"

Flood-Damaged Cars For Sale Nationwide

By Joe Benton
ConsumerAffairs.com

February 5, 2007

Salvage Titles • Suit Charges Feds Fail to Fight Title-Washing • Carfax Reports Record Amounts of Title "Washing" • Congress Treads Water on "Flood Car" Bill • States Need Help Fighting Used Car Fraud • Title-Washing Scams Follow Katrina • Pennsylvania Suit Challenges State Farm Salvage Title Deal • State Farm's Wrecked Car Owners Feeling Slighted • State Farm Pays $40 Million to Settle "Branded" Car Title Issue • California Bill Would Expose Totaled Vehicles

Car buyers beware! Water damaged and title-washed vehicles are flooding used car lots around the country at twice the rate of the last several years, according to Carfax.

Vehicle history reports ordered by dealers or consumers in the three states hardest hit by the 2005 hurricanes and flooding showed the largest increases. In Mississippi and Alabama, the rate of vehicles found to have water damage increased 633 percent. In Alabama, the rate was 374 percent.

"Our data shows a clear pattern of growth for those states within close proximity to the Gulf Coast or that have large populations and sprawling urban areas," said Larry Gamache, communications director at Carfax. "Flooded cars are indeed on the move and consumers everywhere are at risk."

With used car sales expected to top 44 million this year, consumers should be on high alert for signs of hidden damage and potential fraud.

One of every 150 vehicles in Louisiana checked against the Carfax database in 2006 had a title that at one point was suspected to be flood-damaged. In 2002 that number was one of every 700 vehicles, according to Carfax.

Auto industry analysts suggest that at least 200,000 vehicles had their titles branded as flood- or storm-damaged as a result of hurricanes and floods in 2005. Roughly 45 percent had their titles "washed" after being moved to a different state.

Waterlogged vehicles are turning up far from the Gulf Coast in states like Virginia, Minnesota and Montana where consumers and dealers are less vigilant when it comes to flood-damaged vehicles.

All but two states, Nebraska and Nevada, showed an increase in flood-damaged vehicles according to Carfax and most of the increases were in the triple digits.

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