You have been to the dealership multiple times to have your new car repaired. The mechanical problem is covered by your warranty, but the dealer cannot fix it. With the help of an attorney, you get the manufacturer to agree your vehicle is a lemon, and the manufacturer offers you a replacement vehicle. But you do not want a replacement. You want your money back…
Consumers who establish that their vehicle qualifies as a lemon under California law can insist on a buyback. They are not required to accept any alternative remedy put forth by the manufacturer. The buyback process is relatively straightforward, and hiring an attorney will help ensure it goes smoothly. But those considering a buyback should understand that they will not receive all their purchase money back. Furthermore, anyone considering buying a previous buyback vehicle should think twice. The same mechanical problems tend to reoccur even after the vehicle is refurbished and put back on the market.
Neale & Fhima represents vehicle owners in the Bay Area, Los Angeles, Orange County, San Diego, and across the state. We handle the lemon law claims process from start to finish, including buyback price negotiations. Contact our office to speak with a California lemon law attorney now.
The 7-Step Buyback Process
Selling a lemon car back to the manufacturer should be as easy as handing over the keys and getting your check. Unfortunately, it is a little more complicated. The process can be broken down into seven steps:
Step 1: Take the vehicle to the dealership for repair without delay.
Consumers must give the dealership an opportunity to perform the warranty repair work. This should be done as soon as possible, because as far as the law is concerned, the defect does not exist until the owner takes the car to be repaired.
Step 2: Make a record of every repair attempt.
Failing to document warranty repair work prior to filing a lemon law claim can delay the buyback process. Be sure to save a copy of each work order, and if the dealer is too busy to get to your vehicle on a particular visit, request documentation showing that you attempted to submit the vehicle for repair on that date.
Step 3: Retain an attorney.
Hiring a lemon law attorney has no financial risk to consumers and offers significant benefits. An experienced lawyer will ensure every aspect of the claim is complete and correct before moving forward. The lawyer will also handle the remaining steps of the process and will litigate the claim if negotiations are unsuccessful.
Step 4: Submit a buyback demand letter to the manufacturer.
At this stage, your attorney will notify the manufacturer of your claim and the fact that you are electing the buyback remedy. The demand package must include all supporting documentation. It must also demonstrate that you are entitled to relief pursuant to the unique provisions of California’s lemon law.
Step 5: Negotiate the terms of the buyback.
This is when your decision to hire an experienced lemon law attorney will prove crucial. Manufacturers may try to deny a claim, based on false assertions or skewed interpretations of the law. Even when they acknowledge that a claim is valid, they will make every effort to minimize the amount of the settlement. Neale & Fhima will expose these tactics for what they are and ensure the manufacturer agrees to a fair repurchase price.
Step 6: Surrender the vehicle.
Sometimes an owner or lessee of a lemon vehicle is reluctant to part with it, despite its mechanical problems. This is understandable. Many of us become emotionally attached to the cars we drive. If you fall into this category, our lawyers may be able to negotiate a “cash and keep” settlement instead of a buyback. But if you want to receive the full value of your vehicle through a buyback, you must agree to relinquish ownership.
Step 7: Obtain payment from the manufacturer.
All the money the manufacturer pays for your lemon vehicle is yours to keep. You can put it toward the price of another new vehicle or spend it any way you wish. The manufacturer will pay your attorney’s fees and costs, not you.
How Much Will the Manufacturer Pay to Buy Back My Lemon?
California’s lemon law is designed to protect consumers. It aims to put consumers into the financial position they would have been in had the mechanical problems not occurred. The law does not provide a windfall to consumers, however. Compensation is not available for the period of ownership prior to the onset of the mechanical problems. The value of this period of ownership is known as the “use reduction” and will be subtracted from the settlement amount. Here is how it works:
Sample Buyback Price Calculation
- The consumer purchases a vehicle for $50,000, including taxes and fees.
- Mechanical problems begin when the odometer reads 10,000
- The dealership is unable to make the repairs.
- The consumer may sell the vehicle back to the manufacturer for $45,833.
In this example, the use reduction results in the consumer receiving $4,167 less than the purchase price. This represents the value of the 10,000 miles of usage prior to the defect’s becoming apparent. To make this calculation yourself, divide the odometer reading at the time the mechanical problems begin by 120,000, then multiply it by the purchase price.
Beware of Previous Buyback Vehicles
Auto manufacturers want to recoup as much of their loss as possible following a lemon law buyback. After taking ownership of a lemon car and repairing or replacing the defective components, they will put the vehicle back on the market if possible.
California imposes strict resale conditions for lemon law buyback vehicles. These conditions include the following:
- Title to the vehicle must be marked to indicate the vehicle is a lemon law buyback.
- The manufacturer must repair the defect that led to the prior lemon law claim.
- The dealer must inform potential buyers of the repair work performed.
- A window sticker must appear on the vehicle to alert potential buyers of its history.
- The new buyer must receive a one-year warranty covering the repaired defect.
Purchasing a lemon law buyback vehicle is nevertheless a risky proposition. Some defects are simply impossible to rectify. If the manufacturer could have avoided the buyback by making the repair earlier, why did it not do so? At a minimum, car buyers should expect to receive a satisfactory answer to this question from the dealer. The more prudent choice is to avoid purchasing the vehicle altogether.
Get Help from a Lemon Law Attorney in California
Our lemon law lawyers have a long history of dealing with the big automobile manufacturers. If you want to pursue a buyback, we can advise you on how to proceed and how to maximize the amount of your settlement. Call Neale & Fhima at (888) 996-4568 from anywhere in California, or send us a message using the form below.