Karley Cicale, FISM News
If you’re a potential car buyer who’s been waiting for the auto market to bounce back from pandemic shortages before picking your new ride, take this word of caution: if you suddenly see used car lots filled with new options, remember that many locales were recently ravaged by Hurricane Ida and intense flooding.
And what’s the first thing affected by flooded roads? Cars, of course. Cars which may now be sitting on a used car lot thousands of miles away from where the flooding took place. Cars waiting for an unsuspecting consumers with an innocent “for sale” sign in the window.
Storms like Hurricane Ida can present an opportunity for scammers and people without comprehensive flood coverage to try and cover up damage and sell their car on the market.
“Unfortunately, following major hurricanes or flooding events, we see fraudsters try to scam consumers by selling cars damaged in the flooding,” said Tully Lehman, public affairs manager for the National Insurance Crime Bureau.
If you are intent on making a used car purchase in the near future, go into the deal (especially if it is a private sale) aware of what flood damage entails, and how to be sure you’re not unsuspectingly buying a damaged car.
Safe Auto has come helpful tips to keep in mind when looking for a car:
Look for signs of flooding: Moisture in the trunk or carpet, water lines in the engine compartment, moldy or musty odors, rust under the car, and mud in the glove box or center console are all potential clues of a flood-damaged car.
Hidden damage can compromise safety: Even if you make extensive repairs on a water-damaged vehicle, its safety is probably compromised. In some cases, these cars have hidden damage that is difficult to spot, such as softened hoses or faulty electrical work. Although electrical components may be functioning now, salt water contact can cause corrosion overtime. Resulting in issues that present themselves months or years down the road.
Low resale value: If you plan to drive your used car for a few years and then trade it in or sell it, you’ll find a flood-damaged car has a low market value. It’s costly to completely restore a vehicle that has sustained water damage. Therefore, the likelihood that you’ll encounter this problem is high as sellers may not want to invest in fixing up a car with a flood or salvage stamp.
Insurance difficulties: If you’re considering a car that has been involved in a flood, you should factor in the insurance costs as well. It may cost you more to insure a vehicle that has flood damage, or your car insurance company may be unwilling to insure it at all.
Documentation is a valuable tool as well. CarFax’s free Flood Check reports whether a car has a flood or salvage title, was declared a total loss by the insurance company, or was reported as flooded by repair shops. Experian’s AutoCheck also performs free flood risk checks which show if the vehicle has been titled/registered up to 12 months prior in a county that was involved in a natural disaster.
It should be noted that this documentation isn’t foolproof, especially if a car wasn’t fully insured or repairs were made on the car without a claim. When an insurance company totals a car, a new title is issued called a “salvage title” and are “branded” with the word “salvage” or “flood.” In some states however, this warning is only shown on the title as an obscure letter or number code.
In this case, the National Motor Vehicle Title Information System can be helpful to run a background check on a vehicle. According to Consumer Reports, “This system aims to crack down on the practice of “title washing,” when cars that have been totaled (or stolen) get clean new titles in states with lax regulations”.
Unfortunately, due to Hurricane Ida, car prices will continue to rise as the supply of used and new cars has only been further depleted. But, keeping these factors in mind will ensure you can determine whether you’ve really come across a “steal” or a scam.