What is Lemon Law Buyback in California

Buyback Settlement Agreement

If you own a lemon in California and would like to get compensation for your defective vehicle, you will need to file a claim under the CA Lemon Law. If you win your case, the vehicle manufacturer will compensate you in one of three ways:

  • A Buyback or Refund
  • Vehicle Replacement
  • Cash Settlement


How does the Lemon Law Buyback in California work?

A buyback can happen either through a court ruling or through a settlement offer from the manufacturer. The buyback or refund amount is subject to certain deductions allowed by law, which will be explained later. The refund amount will include expenses like:

  • Down Payment. The initial amount you paid for your vehicle.
  • Amortizations. If you obtained your vehicle through financing, this includes all the monthly installment payments you’ve made thus far.
  • Supplemental Expenses. This includes sales taxes, interest and financing-related charges, processing, DMV registration, service contract, and warranty fees.
  • Collateral Expenses. This includes expenses and losses you incurred as a direct result of owning a defective vehicle such as towing fees, car rental expenses, etc.
  • Outstanding Financing Payments. The remaining balance of your car financing loan.

Computing for the Buyback Amount with Mileage Offset

In California, the Buyback Settlement is subject to deductions to account for the time you were able to use the vehicle before the problems began. This is called the Mileage Offset. To calculate the amount deducted from the settlement, use the Mileage Offset formula by multiplying the price you paid for the vehicle by the mileage on the vehicle when you first brought it to the shop for repair and then dividing the result by 120,000.

Here’s a sample calculation of the Mileage Offset formula:

  • Price of vehicle paid by owner: $35,000
  • Mileage on the vehicle when first brought back to the dealership or authorized repair facility: 16,000 miles

To calculate the buyback amount: $35,000 x 16,000 / 120,000

  • Allowed deduction from the Buyback amount: $4,667

California lemon lawyer advising clients

Do I need a Lemon Law attorney to file a claim?

In our opinion, yes. A skilled attorney is an invaluable asset to your case. They can guide you through the process and clarify the law based on your specific situation. You’re unnecessarily sabotaging your chances of winning by filing a claim without the assistance and guidance of a skilled California lemon lawyer.

What about attorney’s fees?

For all successful outcomes, the vehicle manufacturer is responsible for paying your attorney’s fees and any case filing fees. Most lawyers work on a contingency basis and will only get paid by the manufacturer when they win your case. If the case is unsuccessful, your attorney will not bill you for his or her fees.

What is your process for filing a claim?

Our attorneys have litigated hundreds of Lemon Law cases in California and won millions of dollars in settlement for our clients with this proven process:

  • Free Consultation. We gather all the facts and evaluate your case in this initial no-obligations phone consultation.
  • Documentation. If we take on your case, we provide you with a list of documents you will need to submit. You are also required to complete the Retainer Agreement.
  • Case Filing. Your attorney will file your case as soon as you have submitted all the necessary documents outlined above.
  • Negotiate or Litigate. If the manufacturer offers to settle your case out of court, your attorney will negotiate the most advantageous settlement on your behalf. If the case goes to trial, your lawyer will vigorously litigate your case to win a favorable court verdict.

Related reading:


Need help to get compensation for a lemon? After representing hundreds of clients in California, we understand the frustration and stress that result from buying or leasing a defective vehicle. We can help you too. Call us at (323) 553-7525 today for a free, no-obligations consultation to start your claim process.