A lemon law buyback is a vehicle that has been repurchased by the manufacturer after a lemon law dispute and that is now being put up for sale once again. Why would you buy a vehicle that was branded a Lemon and returned to the manufacturer? Well, for one thing, CA Lemon Law buybacks are resold at significantly discounted prices. We’re talking thousands of dollars (sometimes ten thousand or more) below MSRP for a car that’s often practically new. For many prospective car buyers, especially those looking to purchase an expensive luxury car like a Mercedes or a BMW, the offer can be especially enticing. But of course, there are risks to purchasing a buyback. If you’re thinking of buying one, here are some facts to consider before you make the purchase.
The Original Defect Might or Might not be Fixed
Just because a manufacturer has put a Lemon Law buyback up for sale again does not mean that the original defect has been repaired. This is because manufacturers and dealerships are not required by law to fix the problem before reselling the vehicle. Their only legal responsibility is to disclose the fact that the car is a Lemon Law buyback. As most people know, there are unscrupulous car dealers out there who may mislead customers to hide the fact that the car’s defect remains untreated, all just so they can make the sale.
How to Avoid Buying a Defective Buyback
If you’re considering purchasing a Lemon Law buyback, find out every detail about the car’s history. What was the defect and did it get fixed by the manufacturer or dealership before the car was put up for sale again? Never, of course, purchase a buyback that has not been fully repaired. And if you discover that the car had a major defect, the savings might not be worth the risks, even if the defective part was replaced. For example, a car that was returned due to serious brake problems might not be a good buy, even if it’s being sold at a drastically discounted price. If the car was returned because of a minor defect, like faulty wipers, then it may be a good purchase. In some cases, Lemon Law buybacks are cars that were returned due to a technicality in the CA Lemon Law. For example, if a car has a minor defect, but due to the owner’s neglect it was left in the shop for more than 30 days, it can qualify as a Lemon and may be returned in exchange for a full refund. There might not be much else wrong with this car, but because it has been branded a Lemon, its price must be lowered when resold.
Does the Buyback Have a Warranty
Lemon Law buybacks are sold as used cars, and as long as they come with an express written warranty, they are protected under CA Used Car Lemon Law. This is why the most important thing to do after checking the car’s history is to make sure it is being sold with a warranty that explicitly covers the car’s original defect. The warranty does not have to be the original manufacturer’s warranty. It can be a warranty issued by the dealership, even, as long as it is explicitly expressed in writing.
Manufacturer and Dealer Requirements for Reselling Lemon Law Buyback Vehicles
The manufacturer and the dealer must meet separate requirements before they can sell a lemon law buyback vehicle to a consumer.
After purchasing a lemon law buyback vehicle, the manufacturer must:
- Have the notation “Lemon Law Buyback” added to both the title document and the registration certificate.
- Change the vehicle’s title to the manufacturer’s name.
- Affix a decal reading “Lemon Law Buyback” to the appropriate location on the vehicle—(i) the left door frame, (ii) the frame of the primary entrance to the vehicle, or (iii) on the left side of a motorcycle or other doorless vehicle.
The foregoing identifiers put the consumer on notice that the vehicle is a lemon law buyback vehicle.
The dealer must provide the buyer with the following:
- The vehicle’s make, model, year and VIN;
- A statement that the vehicle’s title is marked with the notation “Lemon Law Buyback”;
- A description of every vehicle defect that was reported by the vehicle’s original purchaser or lessee; and
- The nature and results of all repairs made to the vehicle in response to the above-listed defects.
The foregoing notification must be in writing on a letter-sized document.
Frequently Asked Questions (FAQs)
Are All Lemon Law Buyback Vehicles Defective?
No. Most (but not all) were defective at some point in the past. The vehicle may never have been defective but might still be classified as a lemon law buyback for one of the following reasons:
- A manufacturer might have bought back a vehicle from a valued customer as a courtesy.
- The vehicle may have suffered a minor problem for which parts were temporarily unavailable. The manufacturer may have responded by buying back the vehicle instead of telling the customer to wait for the parts to arrive.
- The buyer may have misrepresented the condition of the vehicle by inventing fake “defects.” This might allow them to exploit the California lemon law and get out of their purchase contract.
Most lemon law buyback vehicles were defective at some point, and some of them still are.
How Can I Be Sure That the Vehicle Does Not Contain the Same Defect That Triggered the Manufacturer Buyback?
You enjoy the following protections:
- You can have the vehicle inspected to make sure that all repairs were successful.
- The vehicle´s original manufacturer’s warranty is probably still valid for at least a while. The issuer will not cancel it because of a lemon law buyback.
- Most vehicles have a 12 month/12,000 mile warranty on the defect that triggered the buyback.
If you require even more certainty, you can always extend the warranty coverage beyond any current coverage.
How Can I Avoid Accidentally Purchasing a Lemon Law Buyback Vehicle?
As mentioned above, the primary means of determining whether the vehicle was subject to a lemon law buyback are:
- A decal fixed to the vehicle that identifies it as a “Lemon Law Buyback”;
- A notation on the vehicle’s title reading, “Lemon Law Buyback”; and
- A notation on the vehicle registration certificate that reads, “Lemon Law Buyback.”
Additionally, you can ask the seller, because they are required by law to answer honestly. You should also ask the dealer about any repairs.