How to Calculate a Buyback for a Lemon

In California, lemon law protects consumers who own or lease vehicles, motorcycles, and other types of motor vehicles when their vehicle is defective. This means that lemon law protects consumers when their vehicle is faulty or defective, resulting in any effects that negatively impact the vehicle’s safety, use, or value. These negative impacts are often proven with documentation that the consumer has to take their vehicle into the shop to be repaired an unreasonable amount of times throughout the validity period of their warranty. At the conclusion of a lemon law claim, consumers can decide between a refund or a replacement vehicle. Many consumers choose the route of receiving a refund so they can take control over the process of buying a new car. It’s important to note that when you choose to receive a replacement vehicle, the replacement comes from the same manufacturer that sold you a lemon in the first place. If you are looking into filing a lemon law claim but are curious to learn more about your options,

What is a Buyback?

A buyback is more commonly referred to as your refund if this is the route you choose to go at the conclusion of your lemon law claim. Essentially, the manufacturer buys back your faulty vehicle, and the amount you receive as payment includes restitution and damages or costs that were a direct result of the defects with your vehicle. Restitution is a broad word, so this refers more specifically to the price you paid for your vehicle, taxes, fees for registration, etc. Additionally, damages or costs that are a direct result of the defects in your vehicle include towing fees, public transportation fees, rental car fees, repair costs that were not covered under your warranty, etc. This payment also often includes attorneys fees that the consumer incurred during the process of filing and resolving their lemon law claim.

Mileage Offset

However, many consumers don’t realize that the manufacturer is entitled to deduct something from the payment called a mileage offset. The mileage offset accounts for the miles you drove using your vehicle during times where there were no issues with your car. The mileage offset is calculated by multiplying the mileage your vehicle was at during the first warranty repair for the issue that qualified your vehicle as a lemon by the purchase price of your vehicle. Then you divide this number by 120,000 because this is the average life expectancy of a vehicle in California.

Your mileage offset formula looks like this:

(Mileage before repair attempt / 120,000) x (Vehicle purchase price)

Therefore, your total buyback is equal to restitution plus damages that were a direct result of the vehicle defects minus the mileage offset.

If You Have Questions Regarding Your Lemon Law Buyback, Speak With an Attorney Today.

It can be challenging to decide which path is the best for you at the conclusion of your lemon law claim, because both receiving a buyback/refund and receiving a replacement vehicle are good options. Understanding the amount you could receive as a buyback is an important aspect to consider when you make this final decision. At California Lemon Attorneys, we are experienced in assisting clients determine the best option for their needs once they win their lemon law claim. Because we have helped so many clients throughout the lemon law process, we have the necessary insight to understand your unique needs. If you need assistance with your lemon law claim or are looking to file a claim, please give us a call at 310-922-1199 or email us at Info@calemonattorneys.com for a free consultation.