Many people do not know what to do with a totaled or inoperable vehicle. As a result, many owners have a scrap car or truck collecting rust in the driveway or yard.
This is a big mistake. A scrap car actually retains some value and can net the owner a decent sum of money.
Scrapping vehicles is a robust industry in the United States and other countries across the globe. In fact, millions of cars are scrapped each year.
Following the Great Recession in 2008, approximately 14 million cars were scrapped in the United States. The number of scrapped vehicles outpaced purchases by an astonishing 4 million.
Read on to learn more about why a vehicle is scrapped and what administrative actions are required.
Why Should the Vehicle Get Scrapped?
The obvious reason is financial as it would be illogical to refuse an option that will result in cash.
From a practical standpoint, getting rid of a totaled or inoperable vehicle will eliminate an eye sore in the garage, driveway, or yard. Furthermore, removing the vehicle will free up space that can be used for something else.
For this reason, many owners surprisingly pay a company to remove the vehicle from a property. That’s right — instead of collecting a check, some owners actually pay for the eyesore to be hauled off to a landfill.
Not only is this decision a poor financial one, but it is bad for the environment. Scrapping a vehicle allows useful parts and components to be recycled instead of buried underground.
How Much Money is a Scrap Car Worth?
Junk car value depends on a number of different variables.
The year, make, and model of the vehicle plays an important role. It is common knowledge that Mercedes Benz parts are worth more than Hyundai or Kia parts.
The company that scraps a vehicle will start by cannibalizing for valuable parts such as radiators, batteries, tires, and car speakers, among many other components.
The next factor will be the composition of the metal that makes up the vehicle.
Each metal within the car is worth a different amount per pound. Roughly 55% of a car or truck is made up of steel, so knowing the vehicle weight may give some insight on how much money it is worth.
Although they net less cash per pound, other metals like copper, aluminum, and iron also have scrap value.
What Administrative Actions Should be Taken Prior to Scrapping?
The rules and regulations vary for each state regarding what administrative action should be taken before scrapping a vehicle.
In general, the vehicle title will need to be transferred to the junkyard or company that is taking possession of the vehicle. If the title is not transferred, the owner could be held liable for any injury or damages that occur involving the vehicle.
This is a risk that should not be taken lightly.
In addition, the owner should contact the state’s Department of Motor Vehicles (DMV) to receive guidance on the license plates. In most cases, the license plates will be turned over to the state DMV.
The state may also have some paperwork to be filled out when a vehicle is scrapped.
Totaled or inoperable vehicles still retain value and it is important to turn it into cold, hard cash. If there are any questions about scrapping a vehicle, please do not hesitate to check out some of our car manuals for additional information and guidance.