[n4mwd]

In your case, I would take the $700 and put it as a down payment on a new 2012. If you take your bike back with a salvage title, you'll still have to pay the difference to the loan company and you'll end up with a junkyard bike regardless of how much money you put into it.

That is to say, if you take the bike and salvage title, you still owe the bank $3500 less the $2400 the insurance will give you, this means you have to pay the bank $1100 immediately out of your own pocket. The bank will not allow the title to be converted to a salvage title without getting the loan paid off. The only advantage is that the bike will be free and clear.

I would talk to the insurance company about the salvage title thing and tell them you might consider it if they give you a regular title.