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What are You Entitled to in a Lemon Law Buyback?

Buyback cars with price on windshield in lot

The California Lemon Law offers two options for consumers who can show that they’ve been sold a lemon and are entitled to compensation. If you’re wondering about what happens after you’ve proved that the manufacturer of your car sold you a lemon, read on to learn about how vehicle buyback payments are calculated, and contact a knowledgeable California Lemon Lawyer with any additional questions.

Two potential remedies in a successful Lemon Law claim

Under California’s Lemon Law, customers who are successful in proving that they were sold a lemon are entitled to receive either a replacement of the defective vehicle or a buyback of that vehicle. Broadly speaking, replacements are the less-favored remedy. For one thing, a customer who spent months trying to repair a defective vehicle, then fighting for compensation once they realized the vehicle couldn’t be fixed, rarely wants another car that’s identical to the old one, even if it is brand new and comes with a new warranty. Additionally, in order for a customer to get a vehicle replacement, both the customer and manufacturer must agree to this remedy; the customer cannot demand a vehicle replacement against the manufacturer’s wishes.

Calculating your buyback amount

For these reasons, vehicle buybacks are more common. The buyback amount includes the amount of the down payment on the car, the amount of any monthly payments already made, and the balance still due on the car. Any late fees or penalties incurred along the course of the loan won’t be included in the buyback payment, but any sales tax, licensing fees, registration fees, or other parts of the purchase amount will be included.

The manufacturer pays you this amount, minus what’s known as the usage fee. The usage fee is calculated based on how many miles you were able to drive the car before you had to take it in for repairs on the issue that resulted in the car being ruled a lemon. The formula to reach this fee is based off the number of miles you drove the car before the first repair, divided by the number of miles that California law states is the average life of a car—120,000 miles—multiplied by the purchase price of your car. For example, if you bought your car for $25,000 and drove it for 1500 miles before the power steering started to malfunction, the usage fee subtracted from your buyback would be (1500/120,000) x $25,000, or $312.50.

With careful documentation and the help of a skilled California lemon law attorney, you may be eligible for additional incidental damages, as well, such as any towing fees you had to pay to get your car repaired, the costs of renting a car, or any loan prepayment penalties or early termination fees. An attorney can help you prove your entitlement to these expenses.

If you believe your car may qualify as a lemon and need help getting justice from the manufacturer, contact California Lemon Law attorney Nick Nita at 213-232-5055.

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