What Is a Branded Title?

You have found the perfect car, at a much lower price than you expected. Before closing the deal, you look up the information about the car and, to your surprise, you find that the car has a trademark title. What does this mean, and is it a deal killer?

A marquee title indicates that the car suffered major damage, problems with its odometers, or a defect that caused it to be repurchased by the manufacturer. A car with a branded title can be a bargain, but you need to be aware of the downsides that can make the deal not worth it.

Types of trademark titles

A marque title lasts for the life of the car. Even if the car is repaired to perfection, the brand title distinction cannot be removed.

Trademark titles are treated differently from state to state. Generally, they fall into a handful of categories:

Modified odometer

A car’s mileage affects its value, so state-requested odometer readings are reported when a vehicle is registered. Odometer readings are usually recorded when cars are taken to a mechanic.

Yet, odometer readings are not always accurate. More than 450,000 vehicles a year are sold with false odometer readings, according to the National Highway Traffic Safety Administration.

If the odometer is found to reflect fewer miles than the car has actually traveled, the title will have a title “odometer modified” or “odometer rollback”.

Rebuilt title mark

If a car in an accident is declared a total loss, the insurance company will usually sell the vehicle at auction to try to recoup some of its costs. The vehicle can be purchased by a repair shop who can attempt to repair and sell the car.

After these repairs, the vehicle must pass a safety inspection before it is considered usable. If successful, the state will issue the vehicle a trademark title with a rebuilt or rebuilt label. The title informs future owners that the car has been damaged and rebuilt. The label alerts future owners that the structural or mechanical integrity of the vehicle may have been affected.

recovery mark

A car with a rescue title was in a collision and declared a total loss. To be considered a total loss, insurers estimate the cost of repairs plus the scrap value of the car. The car will be declared a total loss if the necessary repairs and scrap value vary by a certain percentage of the value of the car, depending on the state in which you live. If the insurance company decides the car is a total loss, it issues a Title Salvage Certificate.

Water Damage Mark

Water can damage a car’s interior, create mold and damage the engine. In some states, cars damaged by water or involved in a flood will get a water damage marquee title.

Advantages and disadvantages of brand titles

A car with a branded title can look new and run perfectly, and buying one can be tempting. But before handing over your hard-earned cash, consider these pros and cons:

Advantages

• Branded cars are cheaper: If you’re on a budget and looking for cheap, reliable wheels, a car with a branded title might be the answer. Vehicles with a branded title can cost half the price of a comparable car with a clean title.
• A newer vehicle may be within your budget: By buying a brand title car, you can stretch your budget. You can get a vehicle with more features than you could otherwise afford.

The inconvenients

• The resale of your brand car can present problems: Buyers may be wary of a branded title car, and title can also reduce resale value.
• Financing can be difficult: Many lenders will only finance cars with clean titles. If the vehicle you selected has a branded title, you may have to shop around for a car loan and pay higher interest.
• You may have trouble finding an insurer: Not all insurance companies insure cars with brand name titles, so you may have to shop around for coverage.
• Mechanical problems may be waiting for you: You take a bet with a car with a marque title. A car that has had major damage or other issues may not be reliable and you could end up paying for expensive repairs.

How to tell if a car has a marque title

You can use the following tools to find out if a car has a branded title:

• CARFAX: Although CarFax reports aren’t cheap — a single CARFAX report costs $39.99 — they can be helpful in the car buying process. Not only will CARFAX show if a car has a marque title, but it will also tell you when the title was issued, along with maintenance records and the number of owners of the vehicle.
• VINCheck: A free service offered by the National Insurance Crime Bureau, VINCheck allows you to see if a car has been stolen or reported as a salvage vehicle by participating insurance companies.

For people who know cars well and are looking for a bargain, a car with a branded title can be a great buy. However, buying a car with a marque title is not without risk. Before buying a car with a branded title, have an independent mechanic inspect the vehicle and review its repair records to see what work was done.

The essential

Buying a car with a branded title can be risky, but an affordable option. The marquee title signifies that the vehicle suffered significant damage in the past, but has since been restored to good condition. Nevertheless, mechanical problems may persist and car insurance costs may be higher. And remember, the brand title lasts for the life of the car. Even if the car is repaired perfectly, the brand title mark cannot be removed.