Should I purchase a car with a salvaged title?

I am considering buying a car that has a salvaged title. The dealer says that the car has a salvaged title because the original owner of the car put a Bmw Z3 body kit on a 1999 Mazda Miata. The car has 70,000 miles on it and from what I can see looks completely fine. Also, the retail value of the car if it were a clean title would be "$7,000-8000"; however, I will be purchasing the vehicle for $4800-5000. I plan on financing half of it through USAA for 84.00/month and paying for the rest on my credit card. I would like to know if this sounds like a good deal, has anyone been through the process of purchasing a salvaged vehicle in california, does the insurance rate go up. etc. any information would be great!! Thanks