If you’re shopping for a replacement vehicle, there’s a major item you need to have on your checklist besides price, color, make and model. It’s something you don’t want: evidence of water damage from a flood.
Last year an estimated 250,500 insured vehicles in 15 states were damaged by floods from Super Storm Sandy, said Roger Morris of the National Insurance Crime Bureau of Des Plaines, Ill. About 150,000 of those were in New York.
The total number of damaged vehicles is actually higher because uninsured vehicles are not reflected in the count.
The vehicles are hitting the market now.
Morris said most of the flood-damaged vehicles have been sold to dealers by companies that auction them on behalf of insurance firms. The title should state “salvage” if the car has been in a flood.
“They can be auctioned off and sold as long as they have a legitimate title that shows they are salvage vehicles. A lot have been sold for parts or were crushed,” Morris said. “A lot of them are probably being shipped overseas.”
The vehicles, which may have sat in four feet of salty water, are ruined.
Consumers can check a vehicle identification number for free at www.nicb.org. Click on VINCheck. It contains the vehicle salvage records of participating NICB member insurance companies which collectively provide 88 percent of the auto insurance in force today.
West Palm Beach resident Michael Steffan did not visually inspect for water damage when he purchased a 2010 BMW from Off Lease Only on Lake Worth Road in suburban Lake Worth on May 9. A report by CarFax, which showed the car’s history, said the car was in a repair shop in New York in mid-September, following an accident, the third time the car had been in a collision.
Then there was a gap in the records before Off Lease purchased it at an auction in Georgia in March.
Neither the title nor the CarFax indicated the car was in a flood, and the car is not on the list of Super Storm Sandy damaged cars.
Steffan paid $34,000, but $9,000 of that was for extra warranties, which he found out afterwards do not cover water damage.
“I looked for this specific car and found it at an unbelievable price,” Steffan said.
As Steffan drove the car away from Off Lease on that Thursday, the service light came on. He took it to Braman BMW the following Monday. There, several inches of water were found underneath a panel in the trunk, where the battery was.
Mechanics at Braman BMW and MotorHaus, both in West Palm Beach, inspected the car and said it had extensive water damage and needed at least $10,000 in repairs.
Off Lease General Manager John Giasullo said the car had no water damage when Off Lease acquired it, and he asserts the water damage showed up in the car after Steffan’s purchase.
“We bought it through an auto action. There was no water in the trunk when we bought it,” Giasullo said.
Off Lease told Steffan they would take the car back, minus 10 percent, or $3,400, but Steffan wanted to get out of the deal completely.
Steffan contacted the The Palm Beach Post, which called Off Lease’s Giasullo on June 6. The next day Off Lease released him from the purchase.
Morris said that it’s not possible to prove or disprove that the car was in Sandy’s floods.
A handful of vehicles, all of them in Florida, have shown up with Sandy damage, but with titles that did not indicate that because the cars had been re-titled, Morris said.
“There could be cars that were in Sandy that are not on the list. Nothing is 100 percent accurate,” Morris said.
Morris said it’s buyer beware when it comes to water-damaged vehicles. If the deal sounds too good to be true, there is probably a reason.
“A lot of these cars will be offered at an attractive price. You have to be smart about this. People make some rash decisions trying to save a buck,” Morris said.
Here is NICB’s advice about how to inspect for water damage:
— Inspect the vehicle for water stains, mildew, sand or silt under the carpets, floor mats, headliner cloth and behind the dashboard.
— Inspect the interior upholstery and door panels for fading.
— Check for rust on screws in console or areas water doesn’t normally reach.
— Check for mud or grit in the spare tire compartment, alternator crevices, behind wiring harnesses, around starter motors, power steering pumps and relays.
— Check for moisture, mildew or grime inside the seatbelt retractors.
— Check door speakers.
— Have a certified mechanic inspect the vehicle prior to purchasing it.
— Inspect the title and ownership papers for any potential salvage fraud.
— Look under the hood for signs of oxidation.
— Aluminum and alloys will have a white powder and pitting.
— Run the VIN number through VINCheck.
Trust your instincts. If it sounds too good to be true, walk away.