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The report lets consumers know if a car was wrecked, flooded or declared a salvage. If a car has a salvage title, most people would never consider buying it, as it typically means the car was totaled in an accident or flooded.
But as one man learned, if that Carfax report has the two words "recycling facility," the best option is to run away from that deal, fast — unless the purchaser knows exactly what he's getting into.
Great car, clean title
Cody Murrell thought he had found a great deal on an accident-free, gently used Subaru WRX, until "during the first big rainstorm, I had about three-quarters of an inch of water on the floor," he said.
So he took it it to a repair shop, where he got some bad news.
"I thought the windshield was leaking at first," he said. "But it turned out the leak was from the firewall, behind the motor."
The shop told him the car had been in a wreck, and poorly repaired.
So Murrell ordered a Carfax report, which said, "Accident reported. Vehicle involved in a rear-end collision."
But Murrell claims the dealer had sold the car as clean and accident-free, which is why he never even asked to see the Carfax report.
One of the main purposes of a Carfax report is to show consumers if a car was in an accident and possibly has a salvaged title (which will significantly lower its value, to say nothing of driving and safety issues that may crop up).
One issue: Some cars are repaired and put up for sale so fast, they can beat Carfax to the update, as it typically takes about 90 days for an accident to show up in state records. So even a car with a clean Carfax report can sometimes end up showing an accident history 6 months later.
But a bigger issue, in this case, is that no one — not even the dealer — caught this line on the Carfax report: "vehicle at automotive recycler facility, vehicle was sold as a whole unit."
What recycling facility really means
That strangely worded, easy-to-miss line means the vehicle it went through an auto recycling center, where totaled vehicles are towed.
In some states, any car sold by a recycler now has to be branded "salvage." But it can take months, possibly a year or more, for all that be entered into the state motor vehicle records.
That made Murrell's great deal a horrible one, as his WRX was now worth thousands less than he paid for it.
"With a salvage title, it never would have gone anywhere near that price range," he said.
Carfax spokesman Chris Basso tells me Murrells' Carfax report was 100 percent accurate, but at the time the car was not listed as a "salvage," and still had a clean title. So Carfax was not at fault.
The dealer said they were unaware of any problems as well, as the car had a clean title at the time of the sale. But they ultimately agreed to get Murrell into a new Subaru at a discounted price and buy back his damaged one.
Bottom line: Check the Carfax report before you buy, and be especially wary of any car sold by a recycling facility at some point in its life.
That could mean the title will soon become an almost worthless salvage title vehicle — after you buy it, of course.
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