The catch is that most banks won’t finance “rebuilt-titled” cars, you don’t have a dealer warranty (and most plainly refuse to work on rebuilt cars) and the vehicle has a 50-60% (or less) resale value than a “clean-title”.
It's selective definancialization, and I love it. Same reason why buying tax foreclosures is such a great bargain: you don't have to compete with bank-financed buyers!