Some Cars Are All Wet

On The Early Show, Consumer Watch brings a serious warning to car buyers: Thousands of used cars about to hit the market might have a troubled past. Consumer Correspondent Susan Koeppen reports.

Most people are under the impression that cars that get stuck in floods are junked right away. Over the past few months, we've seen plenty of pictures of cars becoming flooded in all of the recent hurricanes. Did you ever wonder what happens to all of those cars?

Well, some of them do go to the junkyard. But many are cleaned up, and they could be coming to a used car lot near you.

Diane Zielinski, who lives outside Philadelphia, thought she was getting a good deal when she bought a used Pontiac Grand Am for her son, Nate.

She explains, "It looked good. It ran good when we took the test drive, and there was nothing to indicate there was a problem with it at all."

But three weeks after Nate started driving the car, there was major trouble. He says, "I went to make a left-hand turn, and all of a sudden I heard 'bang!' An extremely loud bang."

The car blew up.

Recalls Nate, "There was oil and pieces of engine block all over the place."

Turns out his Grand Am had a soggy past. When Nate checked the car's history on a Web site called Carfax.com, he discovered it had been damaged in a flood in New Jersey a year earlier.

"I almost fell off the chair," he says. "I was like, 'Wow, my car was under water at one point!' It's not supposed to be that way."

Consumer watchdogs say more than 100,000 cars were damaged in floods caused by this season's hurricane blitz. Over the next several months, many of these cars will be flooding the used-car market after being dried out and cleaned up.

Are scam artists trying to make a good buck by selling cars that have been in a flood?

"Sure, and it can be a lucrative enterprise for them," says Jerry Pappert, Pennsylvania's attorney general, who adds that, if a car is flood-damaged in his state, its title will be branded "flood vehicle." But unscrupulous dealers can make that information disappear by taking the car to a different state. Most don't require the flood-vehicle brand. They get a new title in that state. The car now looks clean. It's called "title washing."

How easy is it for these cars to go from state to state to state and eventually end up looking like a great used car?

"Very easy," says Pappert. "If you've had the ability to obtain a flood-damaged car and you're determined to go somewhere and wash the title and resell it as an undamaged vehicle, you can do it."

Experts say that could leave unsuspecting consumers with cars that can be dangerous to drive. Flood damage can lead to serious problems; headlights, windshield wipers, brakes, even your air bags, can fail.

So how can you spot one of these cars? Reporter Koeppen asked AAA auto repair expert Joe Erickson to show The Early Show viewers where to look.

Looking in the engine, what is the telltale sign that a car might have been in a flood?

"You are looking for any ring around the tub, so to speak," says Erickson. "You are looking for a water line that will be marked by mud (or) silt."

Also, check under the floor mats. Feel the carpets for dampness.

Next place to look is inside the trunk. "Again," advises Erickson, "you are looking for damp mats, a musty smell. Run your hand over the mat.

Erickson says to lift up the carpet until you see the spare tire. Check for signs of water, mud and rust. That's not stuff that will normally be in that area of a car.

Diane Zielinski says she cringes when she sees the cars underwater on the news, thinking that somebody is going to buy those cars, as she did.

She tried but she never got any money back from her dealer, leaving her with a junk car and a hole in her wallet.

"It's ripping people off," she warns, "and it's putting people's lives in danger by driving these cars."

To check a car before you buy it, you need the vehicle identification number, also known as the VIN. It's the really long number under your windshield on the driver's side. Then, go to a Web site like Carfax.com. Type in the VIN, pay a small fee, and the history of the car will pop up.

And, of course, it's also a very good idea to have a mechanic check out that car before you buy.

If you get stuck with one of those "flooded cars" anyway, you should contact the attorney general in your state and file a complaint, because if somebody is selling you a car and that person knows it's been in a flood, it is illegal for them not to tell you. You have to be informed.

To find the attorney general for your state, go to the Web site for the National Association of Attorneys General and look it up there.