California Lemon Law Buybacks Program: What To Expect

So you’ve recently purchased a vehicle and have made the unfortunate determination it meets the criteria of lemon law in California. There are probably a lot of things running through your mind about what to do next.

Unfortunately, earning a lemon law buyback is rarely an easy process. The end goal is that the manufacturer or dealer meets your rights.

What’s Considered a Lemon?

Under California lemon law, a defective vehicle may be ruled a lemon if:

  • It was covered under the manufacturer or dealer warranty when the defect was first reported; and

  • It has one or more defects/nonconformities that substantially impair the vehicle’s use, value, or safety; and

  • The vehicle has been subjected to a reasonable number of repair attempts by a manufacturer-certified facility to fix the defect/nonconformity; or

  • The vehicle has been out of service for repairs on one or more defects/nonconformities for 30 cumulative days; and

  • The defect or nonconformity must not have been caused by driver abuse or neglect.

If your vehicle meets these qualifications, there are two lemon law case outcomes to pursue:

  1. A replacement of the defective vehicle.

  2. A buyback of the defective vehicle.

Buybacks are the most common, but some customers are loyal to car brands and prefer replacements. There are several things you need to know about both processes and how they work under the California Lemon Law buyback program.

Lemon Vehicle Replacement Policy

For starters, let’s discuss lemon law replacements.

It’s important to note that this remedy is optional for both the manufacturer and the consumer. Contrary to a lemon law buyback, a replacement only occurs when both parties agree on the terms. In other words, if you want the manufacturer to replace your lemon vehicle, you cannot force them to do so.

If both parties agree, the manufacturer must replace the defective vehicle with a new, identical one, along with a fresh warranty. Or, they may provide a replacement vehicle of the same value.

Furthermore, the manufacturer must cover all collateral fees associated, which typically include license fees, sales tax, and registration, in addition to all legal fees from filing the case. Many consumers are hesitant to choose a replacement vehicle from the same manufacturer that just sold them a defective one; leading them to choose the buyback option.

The process of filing lemon law claims for a replacement is not always clear. Consult with a qualified lemon car lawyer to learn more about your options.

California Lemon Law Buyback Guidelines

The California lemon law buyback program, on the other hand, requires a different procedure than replacements.

What is a Lemon Law Buyback?

A California lemon law buyback is a vehicle that the manufacturer has repurchased following the events of a lemon law dispute.

In the event that the manufacturer repurchases the vehicle, they are required to pay you the lemon law buyback amount”.

Buyback values involve many different factors specified in the lemon law claims.

The amount the manufacturer provides in the lemon law buyback must include the down payment for the vehicle, the monthly payments you have made, as well as the remainder of the loan. The manufacturer may NOT be responsible for any late fees or penalties the consumer may have accrued under the terms of the loan.

Additionally, the manufacturer is responsible for any transportation charges you incurred when you purchased the car. They must also cover any charges for manufacturer-installed items or manufacturer items installed by the authorized dealership. Depending on the defect, the manufacturer may not be required to pay for any non-manufacturer items that were installed in the car by you, a dealership, or any other party.

Finally, the manufacturer must reimburse you for the sales tax, registration fees, licensing fees, and all of the official charges you paid when you originally bought the vehicle.

In order to determine the lemon law buyback value, you can use a buyback calculator.

The general California lemon law buyback formula is:

Purchase price of the vehicle – Usage fee = Lemon law buyback value

Usage Fee

Once the total lemon law buyback amount has been determined, the manufacturer may be entitled to subtract a usage fee. The usage fee represents the miles of use prior to the first time the vehicle was presented for repair.

To determine this fee, there is a simple formula prescribed by law, based on what the lemon law California legislature determined to be the average life of a vehicle (120,000 miles). 

For instance, let’s say you bought a car for $20,000. You drove it for 2,000 miles before the transmission started to show signs of faultiness. So, we will plug these numbers into the formula:

(Miles Driven) / (Statutory Average Life of Vehicle) x Price You Paid for the Car = Usage Fee

(2,000 miles) / (120,000 miles) x $20,000 = $333.33

If you have had multiple issues with the vehicle, the usage fee may depend on when you brought the car in for the defect that officially rules it a lemon. For example, let’s say you started having issues with the seatbelts after 1,000 miles. You brought the car in, and the manufacturer or authorized dealer fixed it.

Now, after driving the car for another 2,000 miles (totaling 3,000 miles), the engine fails. After four failed attempts to fix the engine, the car is officially ruled a lemon. In this case, you may have to use 3,000 miles in the equation – not the 1,000 miles when the seatbelt issue was reported.

Coverage for Incidental Damages

In addition to everything associated with the lemon law buyback amount, the manufacturer must also pay for any incidental damages under the lemon law in California. These damages refer to the costs you incurred as a direct result of the lemon vehicle’s defects and repairs. Incidental damages typically include (but are not limited to):

  • Towing fees.
  • Rental car expenses.
  • Repair costs.
  • Prepayment penalties.
  • Earned finance charges.
  • Early termination charges.

In order to get coverage for these incidental damages, it is strongly recommended that you keep track of ALL paperwork, records, and invoices related to the vehicle’s issues and repairs. Furthermore, keep a log of how many total days the car spends in the shop.

Steps to Navigate the Lemon Law Buyback Process

The general steps involved in lemon law claims are pretty straightforward – it’s the small details and negotiations with the manufacturer that get complicated. Once your defective vehicle meets the guidelines of California lemon law, the lemon law buyback process looks like this:

1. Contact a California Lemon Law Attorney

A reputable lemon law attorney will offer a free consultation to discuss your case. You and the lawyer will go over the documentation indicating your vehicle meets the state’s lemon law qualifications – and determine if you have a valid claim.

2. File the Claim

Once all records, invoices, receipts, and documentation are in order, your attorney will draft up the buyback terms for the manufacturer. Essentially, this will include how much compensation you are seeking and the evidence that your vehicle meets California lemon law qualifications.

3. Negotiate with the Manufacturer

This part of the lemon law buyback process is the most difficult and time-consuming. Even if the defective vehicle clearly meets the state’s lemon law qualifications, the automaker has no intention of providing a buyback. Not only are these expensive, but it’s also a mark against their global brand reputation. These companies have extremely high-powered legal teams to avoid lemon law buybacks.

An experienced lemon law attorney knows all the tricks and tactics car manufacturers use in negotiations – and more importantly – how to counter them to earn fair compensation.

4. Collect the Buyback

Once a settlement is reached, the manufacturer will pay out the buyback amount either in a lump sum or in installments over a specified timeframe.

Now, the vast majority of lemon law cases don’t go to trial. If yours does, the attorney you hire will represent you and fight for a fair settlement.

Speeding Up the Process

From a consumer’s point of view, getting a lemon law buyback can oftentimes seem like an uphill battle; a steep uphill battle. The California state auto buyback program can also be extremely confusing to anyone who is not well-versed in lemon law.

To reiterate, auto manufacturers in California have access to the best legal defense in the state. It’s relatively common that the manufacturer will unnecessarily delay the buyback process. As a lemon law lawyer in San Diego, we see this type of trickery all the time.

If your car is defective, the issue(s) needs to be resolved as quickly as possible to avoid putting the driver and other people at risk.

If you believe your vehicle is a lemon, you need to seek out a lemon law attorney right away to speed up the process. More importantly, you need an attorney who values consumer justice and fast buybacks more than anything else.

Lastly, if your car is officially ruled a lemon, the manufacturer is responsible for ALL legal fees. For this reason, lemon law attorneys work on a contingency fee agreement, meaning they get paid AFTER they win the case, and won’t charge you anything out of pocket.

In Conclusion

At Cline APC, our San Diego lemon law group has been dealing with the auto industry for years and knows exactly what it takes to get a lemon law buyback processed as quickly as possible.

Being as how a lemon vehicle is characterized as a defective product, which is not caused by driver abuse, we firmly stand behind the ideology that the consumer should never be charged any out-of-pocket costs or retainer fees to file a lemon law case.

Get started with a free consultation today!

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