A salvage title is issued for a vehicle that has become a "distressed vehicle". A vehicle becomes "distressed" when one or more major component parts (such as bumpers, fenders, transmission, engine, hood, doors, frame, tailgate, body, etc.) have been wrecked, destroyed, damaged, stolen, or are missing to the extent that the total estimated damage is from 75% to less than 91% of its pre-damaged cash value. The vehicle owner's insurance company will determine the amount of damage to the vehicle. The regular title is replaced with a salvage title.
A vehicle with a salvage title cannot be plated or used on public roads until it is recertified by a specially trained police officer and retitled. Since 1989, salvage and rebuilt titles are orange in color and list the vehicle's color and non-salvageable major component parts.
Following is a list of current Michigan title legends for previously salvaged vehicles:
- Prior to April 1990, "REBUILT"
- April 1990 - February 2005, "THIS VEHICLE WAS PREVIOUSLY ISSUED A SALVAGE TITLE"
- March 2005 to present, "REBUILT SALVAGE"
NOTE: Vehicles with only flood damage may be titled as salvage vehicles.
Motor vehicles, motorcycles, trailer coaches, and titled trailers are subject to the salvage law. Mobile homes, ORVs, and watercraft are not included.
Salvage Titles for Late-Model Vehicles
A late-model (newer) vehicle is defined as:
- A vehicle 8,000 pounds or less manufactured in one of the last six model years, or
- A vehicle 8,001 pounds or more manufactured in one of the last 16 model years.
When a Michigan vehicle dealer acquires a late-model distressed vehicle not yet titled as salvage, and the vehicle's estimated cost of repairs is between 75% and less than 91% of its pre-damaged value, the dealer must apply for a resale salvage title within five days.
The Michigan dealer must complete both an Application for Original Michigan Salvage Title (TR-12) form and an Application for Michigan Title - Statement of Vehicle Sale (RD-108) form in the name of the dealership.
If a Michigan dealer acquires a vehicle already titled as salvage (either in Michigan or in another state), the dealer does not have to obtain a resale salvage title. The dealer (only those holding both a B and C license or holding both a B and R dealer license) may sell the salvage vehicle using the reassigned salvage title. If the salvage title is from out-of-state, the dealer must submit both an RD-108 and a TR-12 with the out-of-state salvage title. The TR-12 should identify the damage to the vehicle.
No plate or permit (including a dealer plate) can be issued or used until a rebuilt title application is processed.
NOTE: A salvage indicator on an out-of-state title is always carried forward to a Michigan title, even if the vehicle is damaged less than 75% of its pre-damaged value.
When a Michigan dealer sells a vehicle previously titled as salvage, the dealer must give a written or printed disclosure to the buyer. This document certifies the dealer informed the buyer the vehicle was previously a distressed vehicle.
An insurance company acquiring ownership of a late-model distressed vehicle through payment of damages must apply for an original salvage title using an Application for Original Michigan Salvage Title (TR-12) form.
If the insurance company takes ownership of the vehicle, the insurance company applies for the salvage title in its name.
The insurance company may allow the owner to keep the salvage vehicle if the owner wants it. In this case the title is not transferred to the insurance company. Instead, the insurance company applies for the salvage title in the vehicle owner's name. The insurance company completes the application but the vehicle owner must sign the TR-12. The owner's "regular" title should be submitted with the application for a salvage title.
Recovered Stolen Vehicles
When an insurance company pays a claim for a vehicle that has been stolen, the owner assigns the title to the insurance company. The insurance company becomes the owner of the vehicle. If the vehicle is recovered, the insurance company must apply for a salvage title if one or more major component parts are missing, destroyed, or damaged and not salvageable. This applies even if the estimated cost of repair is less than 75% of the vehicle's pre-damaged value.
When an individual vehicle owner acquires a late-model distressed vehicle, a salvage title must be applied for before the vehicle may be transported or towed. Owners may apply for an original salvage title at a Secretary of State branch office by completing an Application for Original Michigan Salvage Title (TR-12) form.
Salvage Titles for Older-Model Vehicles
An older-model vehicle is defined as:
A vehicle 8,000 pounds or less over six model years old, or
A vehicle 8,001 pounds or more over 16 model years old.
When an insurance company acquires ownership of an older-model vehicle, a salvage or scrap title is not required. The insurance company simply receives the title from the insured and reassigns the title upon resale of the vehicle.
Older-model distressed vehicles are titled as salvage vehicles only on a voluntary basis. Vehicle owners are discouraged from applying for a salvage title on an older-model vehicle because it is not necessary. It is also expensive and often difficult to obtain a vehicle recertification in order to purchase a plate.
Salvage Vehicles from Another State
A vehicle with an out-of-state salvage title, regardless of the model year, cannot receive a Michigan recertified road-use title until:
The vehicle has been recertified and titled for road use in the state which issued the salvage title, or
- The vehicle has been recertified by a Michigan salvage inspector using the TR-13B recertification form. (The TR-13B recertification form is available only to law enforcement officers.)
Applying For a Salvage Vehicle Title
An individual, business, or Michigan dealer may submit applications for salvage titles either at a local Secretary of State branch office or directly to Lansing, Michigan. A check in the amount of $15 made payable to "State of Michigan" must accompany all applications ($16 if a lien is being added to or removed from the title). When using the direct mail method, send all documents, fees, and the TR-12 application (and a RD-108 if a dealer) to:
Michigan Department of State
The Special Services Branch
7064 Crowner Drive
Lansing, MI 48918
Related Online Service
Related Documents & Topics
Salvage/Scrap Title Application Form (TR-12)
Salvage/Scrap Title Application Form (TR-12)