Who buys cars for parts, and how to check them

The kinds of buyers

• Auto recyclers and dismantlers pull usable parts, sell them, and send what's left on for scrap. EPA describes this as the normal path for a retired car: dismantlers take off the valuable parts, flatten the rest and ship it to a scrap recycler (EPA).
• Self-service pull-apart yards set cars out in rows and let customers pull their own parts.
• Scrap metal processors and shredders buy cars for the metal. They shred the hulk, and steelmakers buy and melt the scrap (EPA).
• Pickup buyers come to you, load the car and tow it away.
• Rebuilders and mechanics want cars worth fixing.
• Salvage pools and auctions gather junk and salvage cars from many sellers, insurers among them, and resell them in one place (U.S. Department of Justice).

For federal purposes, nearly all of these count as junk or salvage yards. The Justice Department's definition reaches any business buying junk or salvage cars to resell, part out, rebuild or crush, and it lists shredders, scrap processors, pick-apart yards, salvage pools and auctions by name (U.S. Department of Justice).

What the law asks of them

Federal reporting. Every month, junk and salvage businesses report to NMVTIS, the federal title database, on every junk or salvage car they acquire: its VIN, the date, the seller, and whether it was crushed or put up for sale. The seller's name is shared only with law enforcement and government agencies. Businesses that handle fewer than five such cars a year are exempt (U.S. Department of Justice).

State licenses. States add their own licensing. In Texas, anyone who buys or sells more than five salvage or nonrepairable cars in a calendar year needs a salvage dealer license (TxDMV). In New York, a tow driver who buys dead cars for scrap as a business needs DMV registration as an itinerant vehicle collector or dismantler (NY DMV form MV-35).

Title handling. Some states put a clock on the buyer. A Massachusetts buyer has ten days to surrender a junked car's title (Mass. statute). An Ohio scrap processor gets the same ten days to stamp the title "TO BE CANCELED" and forward it to the county clerk of courts (Ohio statute 4738.16). In North Carolina, a recycler buying an older car without a title must check that it isn't stolen and report it to NMVTIS within 72 hours of the close of business (G.S. 20-62.1).

How they pay, when there's no title. Arizona requires a scrap dealer buying a car without a title to photograph the owner, the car and the VIN, and to pay by check, not cash (A.R.S. 28-2098). Minnesota allows only a check or an electronic transfer for a scrap car bought without a title (Minn. Stat. 168A.1501).

Seven questions to ask any buyer

Each question lines up with something the law already asks of the buyer, so a straight answer tells you a lot.

1. Are you licensed or registered to buy cars in this state? Many states require it, and several publish a lookup. Where to sell a car for parts lists the official license searches.
2. Do you report the cars you buy to NMVTIS? Junk and salvage businesses that take in five or more a year have to. The Justice Department's NMVTIS site links a search of business reporting status (U.S. Department of Justice).
3. What happens to my title after you take it? Where your state sets a deadline, the buyer should know it. Massachusetts and Ohio both give ten days.
4. Who is coming to pick up the car, and do they work for you? In New York, a tow driver delivering a car for scrap is only the delivery agent, never the owner, and the person who sold the car stays the owner on the form (NY DMV form MV-35).
5. Can your business name go on the title before I sign? Never sign a title with the buyer's line blank. Georgia makes handing over a title "assigned in blank" a misdemeanor (Georgia DOR), and Mississippi's revenue department calls it illegal (Mississippi DOR).
6. Should I take my plates off? In most states the answer is yes. Leaving them on is a misdemeanor in Ohio and South Dakota (Ohio plate law, South Dakota plate law). After you sell lists the rule for each state.
7. How will you pay me, and is that the final number? Ask what could change the price at pickup, and get the payment method up front.

Red flags

• The price drops at pickup with no reason you can see. A fair change matches something the driver can point to on the car.
• They want the title signed with the buyer's name blank. See question 5.
• No receipt, and no business name on anything.
• "Leave the plates on, we'll handle it." In most states the plates are yours and should come off.
• "You don't need a title for this car" when your car is fairly new. Most states that allow scrap sales without a title limit them to older cars: at least 8 model years in New York and 12 in North Carolina and Arizona. More on selling without a title.
• Pressure to decide on the spot, or a check for more than the agreed price.

Payment safety

The FTC's advice is blunt: don't accept a check for more than the selling price. If someone sends you a check for more and asks for the difference back, it's a scam. Banks have to make deposited funds available quickly, but a fake check can take weeks to be discovered, and you'll owe the bank the money (FTC). The FTC has warned about this exact setup aimed at people selling cars online (FTC consumer alert).

How we answer the questions we can answer here

• What we buy: whole non-running and junk cars. The entire car goes, and nothing has to come apart first.
• The price: your description sets the offer, and it's confirmed against the car at pickup. If a problem was left out, the number gets corrected then, so describe it honestly. You don't have to say yes, and there's no charge either way.
• Pickup: free, running or not, wherever the car is parked.
• Plates: in most states you take them off at pickup and keep them.
• A missing or unusual title: tell us. It can be sorted out, and the way depends on your state.

Anything else on the list, ask us at (877) 421-6008. For the step-by-step version, see how it works.