What is the "Actual Cash Value" of My Car?

According to industry experts, there are four primary categories that vehicle conditions fall within: Excellent, Good, Fair, and Poor.

What Makes a Car "Excellent" Condition?

For a car to qualify for the excellent category it needs to have several distinct attributes:

• Looks New: The exterior of a car in excellent condition should appear as though it just drove off the lot; zero chips, no rust damage, and no scratches on the paint are all requirements to fall within this category.
• Perfect Mechanical Condition: Every system in an excellent car should be in proper working order so the vehicle can operate at its full potential. This includes the ignition system, suspension, exhaust system, fuel, cooling, lubrication, transmission and electrical systems should be functioning perfectly. That means no fluid leaks, no visible defects, and no evidence of wear-and-tear.
• Requires No Repairs: A car in excellent condition should require zero repairs at the time of purchase; this includes major repairs like engine work or minor repairs like cosmetic maintenance. If you have to spend even a single dollar on fixing up a vehicle, it will not fall in this category.
• Clean Title: An excellent car needs to be free of any sub-optimal car titles, like a salvage or flood title. To fall in this category a vehicle needs to have a clean title, which indicates it's never been deemed a total loss by an insurance company or automotive organization.
• Pass an Inspection: For a car to get into this category it also needs to pass a safety inspection, as well as an environmental smog inspection. A vehicle safety inspection usually involves looking at all the features of your car that facilitate road safety, including the tires, lights, brakes, mirrors, and other systems that protect you and other drivers.

What Makes a Car "Good" Condition?

For a car to qualify for the good category it needs to have several distinct attributes:

• Has No Major Mechanical Issues: While a car in good condition can have some minor issues with its internal mechanics, it still needs to be basically operational. If a car requires major mechanical repairs it likely belongs in the fair or poor condition categories.
• If There Are Blemishes, They Are Minor: Some cosmetic issues are to be expected with a car in this category, but they should be very small. Scratches that can be buffed out, small tears in the interior, or rock chips are allowed. Anything more and the car may fall in a lower category.
• Very Little Rust: Cars in good condition are allowed to have very slight rust damage, but it should not be noticeable. If the car has significant rust (especially if it's rusted through) it will be disqualified from being considered "good".
• Tread Left on Tires: A bit of wear-and-tear is to be expected, and the car's tires can be worn down to some degree. There should be a good amount of the tread left and all tires should match for the vehicle to land in this category.
• Clean Title: As with the previous category, cars that have been deemed good need to have a clean title.
• Only Requires Slight Repairs: A car in the good category will likely necessitate some level of repairs, but they should be minor.

What Makes a Car "Fair" Condition?

For a car to qualify for the fair category it needs to have several distinct attributes:

• Some Mechanical Defects: Cars in fair condition will have some issues with major systems within the car.
• Issues With Cosmetics: There will likely be some problems with the exterior paint and interior upholstery.
• Reasonable Running Condition: While the car doesn't have to run perfectly, a vehicle in fair condition does still need to be operational on the road.
• Clean Title: Like the previous conditions, a fair car requires a clean title.
• Necessitates Professional Work: Fair cars have their share of issues and will need to be taken to the autobody shop for minor (and in some cases major) issues. These issues should not prevent the vehicle from driving directly after the sale.

What Makes a Car "Poor" Condition?

For a car to qualify for the poor category it needs to have several distinct attributes:

• Severe Mechanical Issues: Vehicles in the poor category likely have significant issues with their internal mechanics that may prevent them from being operational.
• Significant Wear-and-Tear, Mileage, or Age: Older cars, vehicles with incredibly high mileage, and vehicles that are worn down tend to land in the poor category.
• Damaged Cosmetics: Large scratches, chipping paint, cracked windows, and ruined interiors are all hallmarks of a poor car.
• Significant Rust: Poor vehicles will usually have large amounts of rust damage; in some cases, these cars may even be rusted all the way through.
• Non-Clean Title: Cars with a sub-optimal title, like a salvage or flood title, will often automatically land in the poor category.

Your vehicle's actual cash value can be determined by finding the rate of depreciation and subtracting that number from the replacement cost of your vehicle. You can find depreciation by determining the overall lifespan of your car and then finding what percentage of its usable life remains. You then multiply this by the replacement cost and you should get your actual cash value.

Much of the information that affects your car's actual cash value can also be found in vehicle history reports. These can help reduce the need to work through complicated math equations,while also providing valuable information like:

• Title Records
• Junk/Salvage Records
• Insurer "Total Loss" Records
• Pricing
• Sales History
• Problem Checks
• Auto Specs
• Location History
• NHTSA Crash Test Ratings
• NHTSA Recalls
• Awards and Accolades
• Manufacturer Information

Websites like GoodCar also provide loan and lease calculators, so you can work out what your monthly payments would be on a prospective vehicle before you buy.