For instance, if you’re looking at a used car, it’s very likely that CARFAX already has the data associated with the vehicle identification number because it had previous owners. The information about that car was gathered from multiple sources and combined into a formatted report. You buy the report from CARFAX’s website, and can view the entire reported history of that vehicle.
How Does a CARFAX Report Work?
CARFAX gathers information from many different sources. The service works as an information or data aggregator, collecting data from multiple sources and combining them into a database. You can make database queries regarding specific vehicles and their information through CARFAX’s web interface. CARFAX gets information from more than 131,000 state vehicle bureaus, automotive auctions, insurance companies, vehicle repair and service businesses, rental agencies, inspection agencies, and much more throughout the U.S. and Canada.
What Is on a CARFAX Report?
A CARFAX report includes several important areas of information. The title information section is considered the most reliable because the data is on record with the Department of Motor Vehicles in the state in which it is registered. A CARFAX report can list approximate retail or trade-in value and then lists the:
Ownership historyTitle historyAdditional historyDetailed history
Ownership History
The ownership history section describes how many owners the vehicle has had, the years the vehicle was purchased, length of ownership, where it was registered, and the last reported odometer reading.
Title History
The title history describes any issues that are found regarding the title. Car titles are marked for specific types of damages to alert potential owners to possible problems. The title history shows if the vehicle title has been marked as:
Salvage: Whether the vehicle is a salvaged vehicle, not roadworthy, or the repair costs exceed 75% of its pre-damage value. Generally, it cannot be titled in the issuing state again.Junk: Similar to a salvage titleRebuilt: A salvage or junk vehicle that has been rebuiltFire: Vehicle damage caused by a fire that exceeds its fair market valueFlood: The vehicle was severely damaged by waterHail: Hail damage to the vehicle exceeded its fair market value that exceeds its fair market valueLemon: Used when the vehicle manufacturer buys back the vehicle because there are too many issuesNot actual mileage: The vehicle seller certifies the mileage on the title when selling the vehicle. This is used when the seller cannot verify or certify the exact mileage.Mileage mechanical limit exceeded: Some odometers cannot roll past 99,999 miles. This indicates the odometer has exceeded its ability to track mileage.
Additional History
In the additional history section of the report, you’ll find issues reported by the owner or insurance company about:
A declaration of total lossAny structural damagesAn airbag deploymentAn odometer checkAny accidents and other damagesRecalls from the manufacturerThe original warranty information
Detailed History
The detailed history section details any reports, services, sales, inspections, or other events. For example, you might find emissions inspections, registration renewals, accidents listed by owner, and where any events occurred.
Limitations of CARFAX Reports
A “clean” report means CARFAX hasn’t found any significant issues. However, it may not be as simple as a big green “CLEAN” stamp at the top of the report. CARFAX may not be able to access some information, or previous owners and dealers might find ways to keep events unlisted. There might also be mechanical issues with the vehicle that are not on the report because they were not fixed or reported. It’s not unheard of for someone to sell a vehicle in need of costly repairs to a dealer, who in turn only fixes what is necessary to resell the car without reporting it. CARFAX relies on accident reports from police departments for its data. As a result, the report will likely be very accurate if you’re buying a vehicle that’s only been driven in a major metropolitan area. But some accidents might not have been reported if you’re buying in a small town where neighbors agree to pay for damages and take it to a friend for repairs. Some accidents are not reported if the vehicle was taken to a body shop without involving the police. Auto shops tend to report what they fixed, not what happened—so you may only see maintenance or repairs. This might indicate that the vehicle has been in an unreported fender-bender if you notice that a bumper has been replaced, but there’s no corresponding information on the CARFAX report.
Do I Need To Pay for a Carfax Report?
Make sure to have an independent inspection done on the vehicle, and take a test drive before you decide to buy it. A CARFAX report can be a valuable tool, but it shouldn’t be the only one in your arsenal. It doesn’t replace an expert opinion. You can order a single CARFAX report and view it online for $39.99. You can also buy multiple reports at a discount.
