After you wreck the car you love, the last thing you want to hear is that it’s totaled. Fortunately, getting the bad news doesn’t have to be the worst case scenario. You still have options.
Some people think “totaled” means a car is then worthless. However, when an insurance company deems a vehicle totaled, this means the cost of repairs exceeds the value of the car.
If this is the case with your car, you’re probably wondering what your options are. Depending on the extent of the damages, your vehicle may still have significant value.
To help you out, we’re going over some possibilities when considering what to do with a totaled car. Let’s get started.
Turn It Into a Project Car
If you’re into fixing cars or want to learn, turning your totaled vehicle into a project car is a great idea. You may end up with a reliable vehicle down the road.
This option makes more sense if the car you totaled is older. If it is, you probably wouldn’t get much from the insurance claim anyway.
Before you make this decision, you need to understand the extent of the damages. If the engine sustained serious damage, repairing it will require time, knowledge, and money. But if you’re only dealing with minor damage or cosmetic issues, fixing your car is doable.
You’ll need adequate space to store and work on the car. If this isn’t an issue, set up a workshop in your garage and start bringing your totaled car back to life.
Take the Insurance Money
If getting quick cash for your totaled car is your main concern, making an insurance claim and taking the money may be the best route. Don’t jump the gun, though. There are some things you need to consider.
You’ll need to figure out what the value of your car was prior to the wreck. A little online research will give you an answer.
Make sure you calculate the value before making a claim. This helps to ensure you’re getting compensated properly.
If you feel you or the other driver’s insurance company isn’t giving you a fair amount, you may be able to get an appraisal. Make sure your policy allows for this.
Once you accept the insurance company’s offer, you’ll need to sign the title over to them. If you owe money on your car, the lender holds the title. You’ll need to involve them in the insurance transaction.
If you’d rather wash your hands of your totaled car, consider donating it to a good cause. Someone less fortunate could put it to use.
You’ll need to do a little research to find the right charity to donate your car to. It’s important you only give to a legitimate organization. You’ll also want to find a charity that accepts tax-deductible donations.
Once you find a charity, you’ll need to determine the fair market value of your vehicle. You’ll also need to compile as many service records as possible.
Most charities will provide free towing if needed. Then, they’ll either repair it and find a new owner or sell it for parts.
After you donate your car, make sure and keep all paperwork associated with the transaction. You’ll need this when itemizing your tax deductions.
Sell It To a Junkyard
If the damage to your car is extensive or you didn’t have full coverage, you may want to consider selling it as a salvage vehicle. This is another option better suited to older cars that didn’t have a high value prior to the accident.
You’ll first need to get a salvage certificate for your vehicle. To do this, you’ll have to sign the title over to the motor vehicle agency in your city.
After you get the salvage certificate, start calling junkyards in your area and getting offers. Depending on the condition of your vehicle, they’ll either strip it for parts or repair it and try to resell it.
When getting offers, make sure you consider the price of towing and disposal fees related to non-metal components like tires. Don’t let a junkyard overcharge you for these things.
Once you accept on offer, you’ll need to sign the salvage certificate over to them. If you’re not sure whether selling your totaled car is right for you, learn more about it here.
Keep Driving It
There’s a misconception that a car only gets totaled after a serious accident. The truth is, even something like hail damage can cause an insurance company to total out a vehicle. In these situations, continuing to drive the car is a reality.
This is the perfect scenario if you’re not in a position to buy a new car and don’t want to claim the damage on your insurance. It’s also a good move if you love your vehicle but can’t afford to get it repaired at the moment.
The downside is you’ll have to drive around in a beat-up car. However, if it runs well, it makes sense to keep it and fix the cosmetic damage when you have the money.
Consider Selling to a Dealership
If your car gets totaled but still has significant value, consider selling it to a dealership. There’s a good chance you can get enough for a hefty down payment on a new car.
This is a smart option if you need a reliable vehicle and don’t feel good about driving a car that’s sustained damage. A dealership will buy it from you, repair it, and sell it at an auction. Or, they’ll sell it for parts.
Like selling to a junkyard, you’ll need to obtain a salvage certificate. You’ll then need to start looking for the best offer.
Make sure you get several offers before making a decision. You don’t want to jump at the first offer only to learn it was way too low.
Decide What To Do With a Totaled Car
Totaling your car may be an inconvenience, but it’s not the end of the world. In some cases, it may lead to a better situation for you.
If you’re wondering what to do with a totaled car, consider the tips discussed above and get back on the road as soon as possible.
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