Car buyers warned: Watch out for Sandy-damage sales

Mayor Arthur Puglia of Mansfield at an insurers' "junkyard" of flood-damaged vehicles.
Mayor Arthur Puglia of Mansfield at an insurers' "junkyard" of flood-damaged vehicles. (RON TARVER / Staff Photograher)
Posted: February 03, 2013

Buyer beware: Thousands of cars damaged in Hurricane Sandy are for sale in the Garden State, and not all of their owners may be entirely forthcoming.

In New Jersey, where vehicles compromised by flooding or other means must be so identified on title transfers, more than 13,000 have been logged in the last three months, according to the Motor Vehicle Commission.

Selling damaged goods isn't illegal, but officials want to ensure that no one makes an uninformed purchase.

"The consumer really has to use the first line of defense, which is knowledge," Raymond P. Martinez, the agency's chairman, said Friday.

The Attorney General's Office has created a database of vehicle identification numbers for the distressed cars and trucks. The numbers were reported to the state by insurers seeking "flood" or "salvage" titles for vehicles they acquired after claims adjusters ruled them a total loss.

The numbers are available at www.njconsumeraffairs.gov/floodedcars.

If insurance was not involved, an owner hoping to unload a vehicle could try to conceal damage, officials warned. Private deals are protected under state consumer laws.

There are auto lots throughout New Jersey and New York filled with storm-damaged cars waiting to be junked or sold. The Internet has lists of flood vehicles to be auctioned.

In Mansfield, Burlington County, residents say a "junkyard" of hundreds of damaged vehicles has sprouted on 22 acres on Route 543, off I-295. The parcel is being used by insurance companies for storage, according to officials.

"They came in the middle of the night and started dumping cars here," Mayor Arthur Puglia said. "Our town does not deserve to be treated like this."

As soon as some go, others arrive, he said.

Each time a vehicle changes ownership, it is retitled. One day last month, the MVC received 800 title applications for cars identified as flood-damaged, Martinez said.

Mechanics and hobbyists willing to take on restoration projects can get good deals.

"You may choose to buy a car that has been flooded," said Frank Scafidi of the National Insurance Crime Bureau.

Based on insurance claims, Scafidi said, about 230,000 vehicles were damaged by Hurricane Sandy, most in New Jersey and New York. Thousands were totaled after adjusters determined the repairs were too costly. It's the largest number of losses since Hurricane Katrina in 2005.

Katrina cars were sold in unscrupulous deals nationwide, said Scafidi, who advocates performing a thorough VIN background checks. Commercial services will provide the entire history of a vehicle, including owners, accidents, damage, and mileage.

"A VIN is like a fingerprint for a car. It's with you when you are born, and it goes with you when you die," he said.

Since Sandy, said Marshall McKnight of the New Jersey Department of Banking and Insurance, owners have filed nearly 58,000 private claims for personal and commercial vehicles, and insurers have paid about $580 million in damages. If an adjuster has ruled the car not worth repairing, the insurance company usually retains salvage rights.

The vehicle has "some measure of value, even if taken and crushed for metal" or sold as parts, McKnight said. It also can be sold with flood or salvage marked on the title.

Authorities suggest that prospective buyers hire a mechanic to inspect a used car prior to purchase. Red flags include mold, a mildew smell, unusual watermarks on the upholstery, or silt, dirt, or water in the engine compartment.

A vehicle exposed to salt water is likely to have electrical problems from corrosion, even if it runs fine now, Martinez said.

"There's no question that car is going to have problems six months from now," he said.


Recovering From Sandy

Coming Sunday: Three months after Hurricane Sandy struck the Eastern Seaboard, the small working-class enclave of Ortley Beach still looks as though the storm might have hit yesterday.


Contact Barbara Boyer

at 856-779-3838 or bboyer@phillynews.com, or follow on Twitter @BBBoyer.

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