Each week we report on the most interesting and informative articles concerning auto diminished value claims. Regarding our diminished value appraisal of a Dodge Challenger SXT Plus with 1,700 Miles that was involved in a front and rear-end collision that caused $18,000.00 in damage. The car was disabled & towed and had structural damage.The claimant hired an independent auto appraiser and made a third-party inherent auto diminished value claim for the vehicle’s loss in value. Once a car is repaired after a collision, it is worth less, often much less depending on the severity of the damage. Regardless of how well the repairer did his job, nobody will pay as much for a previously wrecked car as they would for an identical one that was never in an accident. Presenting a diminished value claim and following it through to a satisfactory conclusion is a daunting task for the average person. Obtaining a comprehensive diminished value report is key.
We learned from these three examples – some dealers might still take as trade in but we will lose a lot off the value because of listed damage even if it was repaired correctly. Also, structurally damaged cars can never be resold for full book due to the damage amount and frame or unibody being compromised, past experience is normally a 35% hit. Also, it would be a hard sell anytime a car like this gets in an accident especially with a bad auto check showing structural damage it could be as drastic as 50% off the book because it would end up in auction and would need to be sold for a lot less than the book due to the damage listed. The opinions of unbiased experts form the basis for a comprehensive Auto Diminished Value Appraisal. We obtain six of them which puts an appraisal prepared by The St. Lucie Appraisal Company in the ballpark. This is what the car owner will experience in the real world.
Dealers providing opinions regarding diminished value were given information specific to this vehicle including year, make, model, mileage, color, options, any other pertinent equipment, date of loss as well as the nature of the repaired damages and the manner in which the vehicle was repaired. Dealer opinions are based on personal knowledge and access to auction results. Dealers were advised that this vehicle was properly repaired.
We contacted several Dodge/Ram dealers in order to establish how these repairs and the resultant repair history would impact this vehicle’s Fair Market Value (FMV.) Dealers were provided with an evaluation of the vehicle’s condition both prior and subsequent to repairs.
Description of damage: Disabling collision damages to the Rear including structural components. Repair cost $18,000.00. LKQ (used) and/or aftermarket parts were not utilized in the repair/not factored in to the diminished value.
The average of six (6) deductions was 36.25%. This is the percentage of Diminished Value to be taken from the Fair Market Value at the time of loss.
We have established that the above captioned vehicle had a Fair Market Value (Average Trade-In Value) of approximately $25,000.00 at the time of loss. Diminished Value = $9,062.50
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