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Lemon law buyback
In a lemon law buyback the maker takes the car back and refunds what you paid: the price, taxes, registration and fees, and costs like towing, minus a deduction for the miles you drove before the first repair. It also pays off your loan. You can often take a replacement car instead, or agree to keep the car for a cash payment. A bought-back car is resold with a branded title, such as "Lemon Law Buyback" in California.
What a buyback pays
- Paid back: the price you paid, sales tax, registration and other official fees, and costs you had from the defect such as towing and rental cars.
- Paid off: the rest of your loan, straight to the lender.
- Taken off: a deduction for the miles you drove before the first repair for the defect. Most states use the price times those miles, divided by 120,000. Ohio and West Virginia set no deduction.
Buyback, replacement, or cash and keep
| Buyback | Replacement | Cash and keep | |
|---|---|---|---|
| The car | Goes back to the maker | Swapped for a comparable new one | You keep it |
| The money | A refund, minus the mileage deduction | Usually you pay the mileage deduction | A sum you agree with the maker |
| Set by | The lemon law | The lemon law | A settlement you sign. No state sets the amount |
| Fits when | You want out of the car | You like the model but not this car | The defect is fixed or you can live with it |
Most states let the owner choose between a refund and a replacement. A cash and keep offer ends your claim, so read what you give up before you sign it, and ask whether it covers future repairs.
The lemon law buyback title
A car the maker buys back does not just go back on the lot. In California the maker must retitle it in its own name and have the state mark the title:
“cause the vehicle to be retitled in the name of the manufacturer, request the Department of Motor Vehicles to inscribe the ownership certificate with the notation “Lemon Law Buyback,””
California Civil Code § 1793.23
Other states have their own branding and disclosure rules. When a used car for sale has a title or history report that says "lemon law buyback", "manufacturer buyback" or "lemon" means the car was returned for a defect. Ask what the defect was and whether it was fixed.
Questions people ask
What is a lemon law buyback?
The maker takes back a car that qualifies as a lemon and refunds what you paid, with taxes and fees, minus a deduction for the miles you drove before the first repair. It also pays off the loan.
What does a lemon law buyback title mean?
The car was bought back by the maker under a lemon law because of a defect. California marks the title "Lemon Law Buyback" and requires a signed disclosure before the car is sold again. Other states have similar rules.
What is cash and keep?
A settlement where you keep the car and the maker pays you a sum. No state law sets the amount. It is agreed between you and the maker, and it usually ends your claim.
How is a lemon law buyback calculated?
The price, taxes and fees and other costs, minus the use deduction. In most states that is the price times the miles driven before the first repair, divided by 120,000. The calculator does it for every state.
Sources
- California Civil Code § 1793.23 (leginfo.legislature.ca.gov)
- Each state's lemon law, quoted and linked on its state guide.
Quotes are copied from the page they link to, checked October 26, 2026.
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