Carfax Reports: 3 Reasons NOT to Trust Them in 2019 (and what to do instead!)
Even if you know very little about used-car buying, you’ve probably heard the mind-numbing propaganda that you ‘have to check the CarFax’- or, any other ‘vehicle history report’- before making a purchase decision.
Every year, millions of car buyers determine what their next car will be based solely on their blind trust in a big green checkmark and their fear of the scary red X that the vehicle history report spits out. Sadly, many of those same trusting car buyers drive off the lot with their “clean title” vehicles, only to discover minor or major issues a few months, weeks, days, or even hours later. As it turns out, while the vehicle they just purchased might have a “clean” title, it doesn’t have the blemish-free “history” that their vehicle history report claims it does and they are now in the hole thousands of dollars in parts and repairs (if the issues can be repaired at all- that is.)
You’re probably asking yourself- How is that possible? How can a car have a “clean history” but then have so many problems at the same time? Why don’t these issues show up on vehicle history reports like CarFax or AutoCheck? How can I avoid this nightmare?
To help answer these questions and ensure you don’t experience something similar, we’ve compiled
The Top 3 Reasons NOT to trust a CarFax Report in 2019 (and what to do instead!):
1. Major (and Minor) Damage History Is Often Completely Missing
‘Vehicle history reports”, like AutoCheck, CarFax and others, are exactly that- they are a “history” of any “reported damage”. For damage to show up on a CarFax- a vehicle has an incident, the owner then has to choose to report that incident to their insurance company, police department, auto body shop, auction, etc- and THEN, IF that entity is reporting to CarFax (or manually submits incident claims), the accident or incident will be added to a vehicle’s history.
Well, what if the damage isn’t reported to an entity partnered with CarFax? Or worse… what if it isn’t reported at all? This happens ALL THE TIME!
Tens of thousands of vehicles have major and minor accidents every year that go unreported for one reason or another. Maybe the owner didn’t want an insurance rate hike so he/she worked it out privately and paid out of pocket for a family member to fix the damage. Maybe the accident happened, went to an auto body shop, but that repair shop doesn’t report to CarFax. Or maybe it was one of thousands of vehicles that was totalled and then covered up by the insurance company, like State Farm did when they mis-titled over 30,000 cars as having a “clean title” when in fact they were supposed to be salvaged. The reasons vehicle histories are often wrong or covered up are seemingly endless.
Even CarFax itself is forced to disclose this fact in their fine print disclaimer on their site where it says, “CARFAX receives accident information from thousands of sources, but not every accident or damage event is reported and not all reported are provided to CARFAX.”
The bottom line: Tens of thousands of vehicles are being sold on used-car lots every year that have a “clean CarFax Report” and a “clean” title, despite major undisclosed accidents, floods, fires, and damages.
2. It Doesn’t Account for the Current State of the Vehicle
Assuming damages are fully reported to someone who will then report it to CarFax, there is often a lag between the time the damage is reported and when it shows up on the CarFax Report.
When you, as a used-car buyer, go to purchase a vehicle, the “vehicle history report” might not display any past damages or incidents simply because the most recent damages are not yet displayed on the report. By the time the reported damages post to the report weeks or months later, you have likely already purchased the vehicle under the impression that it had a “clean” CarFax. You, as the most recent buyer, have now overpaid for the vehicle and are stuck with a car that doesn’t have a “clean” CarFax history.
When this happens, car buyers usually end up “upside down” (owing more than the value of the car) in the vehicle they purchased and have to accept greater than normal losses when the time comes to sell it again.
3. Used Car Salesmen Take Advantage of Misleading Vehicle History Reports
The misinformation and the illusion of transparency created by CarFax Reports is no secret to those who profit off of selling used cars. In fact, they LOVE it!
Vehicle history reports give unethical salesmen and dealerships a deceptive curtain to hide behind when selling a damaged vehicle. So long as the CarFax is “clean”, they can convince any unsuspecting buyer that the vehicle is in top working condition, even when they really know it’s not. It’s no accident that many used car dealerships now offer a ‘free CarFax Report’ with each vehicle. It not only helps them seem more trustworthy and transparent with their customers, but it also allows them to charge more than what the damaged car is likely worth.
DON’T TRUST THE CARFAX. CarFax, AutoCheck, and other “vehicle history reporting” companies, (and unethical used car salesmen!) want you to blindly trust the damage reports they offer you. DON’T.
Instead, follow these 3 guidelines:
1. Understand that all used cars have some history- Embrace it.
“Used Cars” are used. They have been previously owned, driven, rained on, scratched, or bumped into. Expecting a car to be in ‘perfect’ condition when its a few months or years old is just setting yourself up to be disappointed.
That being said, a little bit of history, so long as it’s fully disclosed and made aware of- never hurt anyone. You’re goal should be to get a great vehicle at a great price. There are thousands of great used vehicles for sale every day- you just need to find the one that suits you..
Embrace the fact that you’re buying a used vehicle, determine what you want and need out of your next car or truck, and start the search!
2. Get a vehicle inspection
Unless you’re a mechanic yourself (and a good one!), take the vehicle you’re interested in to your trusted mechanic to have it inspected. Any honorable used car dealership will have no problem with this and the great ones will even offer to reimburse you for the cost of the inspection.
Not all vehicle inspections are created equal so make sure your mechanic is thorough and detailed in his/her work. It might not be a bad idea to print out a list like this one for your mechanic to follow as he/she does the inspection to make sure they don’t miss anything.
3. Buy a branded title vehicle
When it comes to vehicle history transparency and used car value shopping, there is no better vehicle to buy than one with a branded title. Why?
A vehicle with a branded title is one that has undergone some kind of damage or incident, such as hail, flood, collision, or theft that was reported and written off by an insurance company. The car then undergoes repairs to bring it back up to factory specifications and has to pass a second vehicle inspection. Once it passes the second inspection, its title is amended and it’s listed for sale.
When you buy branded, the true vehicle history isn’t concealed- in fact, it becomes a matter of public record. You can see exactly what happened, when it happened, and how it was repaired. Instead of taking advantage of loopholes for concealing it’s true history behind a “clean title”, an incomplete CarFax Report, or a shady salesman, a branded title provides true transparency and is quickly becoming the most trustworthy way to buy used.
Contrary to some myths, branded titles can, like any other vehicle, be fully insured by most auto insurance companies at traditional rates. Same goes for getting financing and extended warranties. Branded title vehicles can get all of that!
The result? You can buy a great used vehicle at a ridiculous discount and with a more truthful understanding of its history.
Don’t buy New. Don’t buy Used. Buy Branded!