Carfax's achilles is that it only lists the damage, repairs, ownership transfers, etc. that are reported to the database either via police records, the DMV, the repair/body shops or dealerships. If you get in a single car wreck, drive away before any cops arrive and take the car to your buddy with a body shop the car will still have a clean history. I'm sure there are numerous ways to get around Carfax by those who really want to.

It can be a helpful tool, though.

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1980 300TD-China Blue/Blue MBTex-2nd Owner, 107K (Alt Blau) OBK #15
'06 Chevy Tahoe Z71 (for the wife & 4 kids, current mule) '03 Honda Odyssey (son #1's ride, reluctantly) '99 GMC Suburban (255K+ miles, semi-retired mule) 21' SeaRay Seville (summer escape pod)