Getting an offer from the manufacturer to buy back your vehicle can be a relief.
After weeks or months of dealing with a defective new car, the manufacturer may finally let you know:
“We’ll take the vehicle back.”
That sounds like the end of the problem.
Sometimes it is.
But before accepting a buyback offer, you should understand exactly what the manufacturer is offering, what deductions are being proposed, what happens to your loan or lease, and whether the agreement resolves all of your claims.
Manufacturers may make different types of offers.
For example, the manufacturer might offer:
• a full repurchase;
• a replacement vehicle;
• a cash payment while you keep the vehicle;
• reimbursement of certain expenses;
The language matters.
Ask for the offer in writing
Do not rely on a telephone conversation.
You should be able to see:
• the proposed purchase price;
• taxes and fees included;
• mileage deduction;
• loan payoff arrangements;
• lienholder treatment;
• registration expenses;
• other deductions;
• attorney-fee provisions, if represented;
• release language; and
• what happens to the vehicle.
You need to know exactly what you are agreeing to.
What happens to your auto loan?
A buyback does not necessarily mean that you simply receive a check for the amount you
originally paid.
If you financed the vehicle, there is usually a lender with an interest in the vehicle.
The manufacturer and lender must coordinate the payoff.
This is one reason consumers should not evaluate a buyback solely by looking at the amount of money being offered directly to them.
The numbers need to be reconciled with the loan balance.
Nevada’s Lemon Law provides for a refund of the purchase price and certain governmental
charges, subject to the statutory provisions, including a reasonable allowance for use.
That makes the calculation more complicated than simply asking:
“How much did I pay?”
What is the mileage deduction?
Nevada’s Lemon Law allows for a reasonable allowance for the consumer’s use of the vehicle in calculating a statutory refund.
This is one of the areas where you should carefully review the manufacturer’s calculation.
Ask:
• What mileage deduction is being used?
• Are all required charges included?
Do not simply assume the manufacturer’s number is correct.
What if the manufacturer offers less than you believe you are entitled to?
That does not necessarily mean you should reject the offer immediately.
It may mean that the offer needs to be analyzed.
There can be a substantial difference between:
“The manufacturer offered me $45,000.”
and:
“The manufacturer offered to repurchase the vehicle for $45,000, but proposes a $12,000
mileage deduction and excludes certain fees.”
The second description tells you what you actually need to evaluate.
What if you want to keep the car?
A manufacturer may sometimes offer money in exchange for the consumer keeping the vehicle.
That can be attractive.
You get money.
You keep the vehicle.
You avoid the inconvenience of replacing it.
But there is an important question:
Do you want to continue owning the vehicle with the problem?
If the defect is serious, you should think about what happens six months or two years from now.
Will the problem return?
Will resale value be affected?
Will the manufacturer continue covering repairs?
Is the vehicle still under warranty?
Read the release carefully
A settlement agreement may require you to release claims.
That can include claims you did not realize you had.
Before signing, understand:
• what claims are being released;
• whether warranty claims remain;
• whether personal injury claims are affected;
• whether confidentiality provisions apply;
• whether attorney fees are included (if represented); and
• whether the agreement contains other obligations.
Should you accept the manufacturer’s offer?
Maybe.
But don’t decide based solely on the headline number.
The right question is:
“What am I actually receiving, what am I giving up, and is the proposed resolution consistent with my rights?”
If the manufacturer has offered a buyback, you may already be well beyond the “Is something wrong with my car?” stage.
You are now negotiating the value and terms of the resolution.
That is a different stage of the process.
Take the 30-Second Nevada New Car Problem Quiz
We’ll ask about your vehicle, warranty, repair history and time out of service.
Precision Injury Law represents Nevada consumers with qualifying vehicle warranty and Lemon Law problems.
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