How Reliable Is Carfax?

Used Car Buying: Doing Your Homework

If you're in the market for a used car, it's wise to learn all you can about a car before making a buying decision. But is it enough to ask the dealer "Show me the CARFAX"? Unfortunately, the answer is "maybe" and here's why...

Title histories are drawn from the National Motor Vehicle Title Information System (http://vehiclehistory.gov), which is maintained by the U.S. Department of Justice. A title history answers important questions, starting with “Does the seller legally own this car?” Various “brand” titles flag cars that have been flooded, declared total losses, salvaged, or sold as junk. Odometer readings taken at each title transfer can reveal whether an odometer has been rolled back.

You should be aware that not all U.S. states participate fully in the NMVTIS.
So it's possible that some of a car’s title history may be missing. The NMVTIS website also mentions that you can inquire with a state's Department of Motor Vehicles to request a State Vehicle Record.

Vehicle history reports also draw data from other sources, including insurance companies, auto repair service shops, and police traffic accident reports. But not all relevant data is captured. If a car is repaired without resorting (or reporting) to insurance, whoever repaired it may not report to Carfax or its competitors. Repairs may never have been made at all, yet remain hidden from easy detection.

Getting Full Disclosure

Many used car dealers provide reports from Carfax, Autocheck, or both. The reports lend credibility to their sales pitches. But buyers should not rely on a report from a single vendor. Just as one anti-malware program may miss an infection that another catches, Carfax may reveal red flags that Autocheck doesn’t, and vice versa. If a dealer won’t provide reports from both leading services, take the one offered and run your own report on the other. It’s easy and relatively inexpensive.

All you need is a car’s VIN (Vehicle Identification Number). Punch it in at Carfax.com or Autocheck.com and you’ll get a teasing summary of the car’s history. Pay a fee to download the complete report, which includes vehicle registration and title information, odometer readings, recall, accident and airbag deployment history, service and repair information, and vehicle usage (taxi, rental, lease, etc.) Both services offer package deals for shoppers who plan to check out several vehicles.

A single Carfax report costs $39.95; up to 5 reports within 30 days cost $49.99, while unlimited reports within 30 days cost $54.99. One Autocheck report costs $29.95; unlimited reports within 30 days costs $44.99. The price differences do not indicate which service is better. Carfax is strictly in the vehicle history business, while Autocheck is a subsidiary of credit reporting agency Experian. Autocheck may well be a subsidized lead-generator for other Experian products.

I'm certainly not saying that Carfax and similar services are dishonest or worthless. Just don't let a “clean” vehicle history report lull you into a false sense of security. The best protection against buying an expensive headache or paying too much is a hands-on inspection by an auto mechanic you trust. Vehicle history reports are just an intermediate step between a test drive and a mechanic’s inspection. You can find more car buying tips in my related article Online Car Buying Tips.

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