What You Need to Know About Lemon Law Buyback Vehicles

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If you have seen the phrase lemon law buyback vehicle while looking for a used car, you may not know what that means, and whether the purchase is worth the gamble. Lemon Law buybacks are those vehicles which were taken back by the manufacturer based on a serious defect which they could not repair under warranty.

Some of these vehicles are repaired and then sold again, so before you buy the car, it is important to understand why you would want to buy a lemon law buyback and what that involves. Here are some key points about lemon law buyback vehicles.

Disclosure Requirements

Most states have laws that require manufacturers or dealers to display an obvious label on lemon law buyback vehicles. More precisely, most state laws require the following:

• A clear label on the title that they brand as a “lemon” or “manufacturer buyback”
• Written disclosures at the closing that identify the defect(s)
• Document supporting any repairs that were made after the vehicle was re-purchased.
  

You should always check the title history and obtain a vehicle history report before you buy.

Nature of the Defects

Not all lemon law claims involve serious issues. The issue could be minor, but on-going, such as a defective sensor or faulty electronics. There is a possibility that the issue involves serious problems, such as a faulty engine, brake issues, or transmission problems. Before making your purchase, you should understand the nature of the defect and whether it was properly repaired.Ask to see all service records and repair logs.

Warranty Coverage

One of the biggest benefits of purchasing a Lemon Law buyback repaired by the manufacturer is that it may come with a limited warranty. An example, in California, the manufacturer is required to give you warranty coverage for 12-months or 12,000-miles for the defect that caused the buyback. Check out the Ford buy back program for impressive warranties. You should pay attention to the warranty to be sure of what it is covering. You may want to consider the cost of an extended warranty for additional protection.

Laws Vary by State

Lemon Laws also differ greatly from state to state in terms of what we classify as a lemon, how many times you must offer vehicle repair, and how long you have to assert a claim. Some states only protect the purchase of new cars, but other states go so far as to protect leased cars, and other used vehicles as well. If you are purchasing a buyback vehicle in a different state, consider how that affects the branding and your rights as a buyer.

Is a Lemon Law Buyback a Smart Purchase?

A lemon law buyback vehicle can be a smart buy if the following occurs:

• The original defect was minor, or easily resolvable
• A repair and inspection have been completed
• There are protections, disclosures, and warranties
• You’re purchasing it from a reputable dealer or manufacturer
  

If you are not able to interpret repair records or assess mechanical reliability, it is wise to have a mechanic you trust inspect the vehicle you buy. Consider your intentions with your purchase long term; are you going to continue driving until it’s dead or plan to resell?

Endnote

Many lemon law buybacks will perform just as well or better than other used cars. Note that there is more risk involved and you will need to do due diligence with the Lemon buyback. If you are considering a lemon law buyback, think of it like any other significant purchase: research, questions and read the fine print. If you understand the laws involved and the pertinent vehicle history, you will be able to effectively evaluate the value of the vehicle.