Salvage titled cars are supposed to be junked out but that is not how it always works.
In this area, wrecked and flooded cars are considered “Totaled” and are given a “Salvage” title and sent to salvage companies in Missouri for parting out.
The company takes these cars, rebuilds them and runs them down into Arkansas where, for $50.00 they can get a perfectly clean title.
Then they are sold through car lots and auction houses.
We had an interesting case not long ago.
A man bought a car in Missouri getting his loan through his credit union. They held the title.
He failed to keep up payments and had the car towed to an impound lot. After 30 days the car became the property of the car impound lot.
The lot owner pulled the car down into Arkansas, and placed it on a lot there for sale with no title.
The Arkansas lot owner got a $50.00 clear Arkansas title and sold the car to a local man who borrowed money from HIS Arkansas credit union to purchase it.
The Credit union holds his Arkansas title.
The Missouri credit union found where the car was and repossessed it.
Now the man who bought it still is paying his Arkansas credit union while trying to find his car in Missouri that the Missouri credit Union has sold elsewhere.
What a mess!
In Georgia there is a constant stream of "wrecked but still drivable" vehicles moving down I-85 in convoys, usually with each manned vehicle towing another. They go to Mobile, Alabama get loaded on container ships and sold in Central/South America.
Wow, what a mess indeed
That is a mess. I wonder if the impound lot in MO followed the law. In Texas, if a car is impounded; the owner AND the lienholder have to be notified by certified mail. If they fail to respond, then the impound lot can file for a clear title.
I had a customer who had her SUV repo’d. She called me at the bank right away thinking I popped it. I didn’t. Turns out she “bought” the vehicle from her father - getting a loan at the bank I work for. How did her father get it? He filed a mechanics lien properly notifying the owner and the lienholder that the vehicle was impounded. No one responded or paid the repair bills and the storage bills, so Dad legally acquired the title.
2 years later... The original lienholder finally repo’d the vehicle. Funny that they - nor the registed recovery agent - noticed that the ownership and the lienholder had changed. It took a few phone calls, but the vehicle was released without cost back to my customer.
Back to your case. IF (big if) the laws were followed and IF the MO credit union failed to respond to the impound letter, then the MO credit union wrongfully repo’d the car.