The Pros and Cons of a Manufacturer Buyback for Your BMW

If you love luxury and performance, BMW might be the car for you.

BMW vehicles are famous for their advanced engineering, sleek interiors, and sophisticated style. Even so, a few models have come short of BMW’s phrase “sheer driving pleasure.”

Some common problems among BMW vehicle owners include defective electric windows, dead batteries, airbags, and a faulty ignition system. Unfortunately, many of these vehicle defects are persistent and hard to solve, affecting a vehicle’s use, value, and safety.

California lemon laws offer a reprieve through buyback or replacement to vehicle owners who accidentally buy defective vehicles. Whether you opt for a buyback or a replacement, both are designed to protect your rights.

However, buyback offers a cash settlement, explaining its popularity. More importantly, understanding the pros and cons of a manufacturer buyback for your BMW can help you make a better decision.

If you need help pursuing a manufacturer buyback for your BMW, consider speaking to an experienced California lemon attorney.

When It Makes Sense: Advantages of Accepting a Manufacturer Buyback for Your BMW

It’s frustrating to deal with a persistent problem with your BMW. For instance, many BMW owners have experienced faulty automatic headlights. The faulty headlights stay on when unnecessary and can draw the battery leading to electrical problems.

Fortunately, lemon laws offer manufacturer buyback to protect consumers who accidentally buy defective vehicles, including BMW.

Here’s why you should consider accepting a manufacturer buyback for your BMW.

Refund of the Purchase Price

If BMW buys back your vehicle, you’ll receive a cash equivalent of the vehicle cost, less the mileage offset. However, the buyback value varies based on the law that’s being applied. The manufacturer can deduct the mileage offset if you claim a buyback for breach of express warranty.

On the other hand, the manufacturer is not allowed a mileage offset if you claim the buyback under an implied warranty. Under an implied contract, the consumer is also restricted from recouping civil penalties.

Here’s the amount to expect from a lemon law buyback:

Lemon laws under Civil Code 1793.2 (d) (2) (B) prescribed that a manufacturer shall issue reimbursement an amount equal to the actual paid or payable by the buyer plus charges for transport, manufacturer-installed options, and excluding installed by the dealer or buyer.

The refund price should also include collateral charges such as license fees, sales tax, official fees, use tax, and any incidental damages entitled to the buyer. 

In a nutshell, you can recover the following expenses for your defective BMW:

• The outstanding loan balance that financed the purchase— is normally paid directly to the financier.
• Total monthly payments, including interest and principal
• Down payment or equity for any trade-in deals
• Registration, license, sales tax, and other official fees

Some of the deductions from the above total include non-manufacturer-installed items such as surface protection and other third-party installed accessories. 

You are also entitled to incidental and consequential damages you incurred when the vehicle was out of use.

Here’s the breakdown:

• Cost of public transport
• Car rental charges
• The cost of repairs incurred outside the warranty
• The cost of replacing the vehicle

Minimize Future Repair Costs

If you keep hold of your lemon vehicle, you’ll continue to experience its defect resulting in additional repair costs. However, if you accept a buyback, you can end these future expenses and the hustle of dealing with persistent repairs.

Enhance Your Safety on the Road

It doesn’t take five years before BMW issues a vehicle recall. According to the United States Department of Transportation(NHTSA), BMW recently upgraded the Takata Recall to a ‘’Do Not Drive’’ warning targeting vehicles manufactured between 2000 and 2006.

The affected BMW vehicles(17-22 years old) expose occupants to a high risk of death or injury in case of an accident. The oldest Takata airbags have the highest probability of failure during a crash. If the inflators rupture during an impact, the metal fragments ejected toward the driver could kill or lead to severe or life-altering injuries.

The above examples highlight how defective BMW vehicles compromise the safety of drivers, passengers, and other road users. 

The following are additional vehicle defects that compromise vehicle safety:

• Steering Defects: A steering defect is a catastrophic malfunction because it makes it difficult—if not impossible to control your vehicle. Even at low speed, a manufacturing defect on the steering wheel can cause your BMW to collide with another car or stationary object. Steering wheels become defective because of fluid leaks, failed rack mounts, or bad tie rods.
• Engine Malfunction: Engine overheating is a common but dangerous defect that affects a vehicle’s safety. When the car overheats, it’s not just the car; it’s a danger to you and the passengers. Unfortunately, it can easily catch fire resulting in serious burns or death.
• Defective Seat Belts: A seatbelt is a crucial vehicle component that enhances vehicle safety which is why defective seat belts can cause fatal or catastrophic injuries. Victims of faulty seat belts suffer strangulation, decapitation, paralysis, and chest injuries.

With that in mind, consider accepting the manufacturer buyback for your BMW to enhance your safety and others on the road.

Reduce Inconveniences

A lemon car is a great source of inconvenience. For instance, you could be well-prepared and energized to drive to a client, only for your BMW to fail to ignite. As a result, you may be forced to use a rental car, an alternative that may not be available at a moment’s notice.

On the other hand, a defective BMW requires frequent repairs and visits to the dealership, which is expensive and time-consuming. 

What to Consider: Potential Drawbacks of a BMW Manufacturer Buyback

You’re entitled to a buyback under California lemon laws if you were sold a defective BMW that is still under the manufacturer’s new warranty. There are a few expectations that govern the buyback process.

For instance, a manufacturer can reduce the buyback amount based on the mileage offset. On the contrary, they’re not allowed to reduce the price based on the vehicle’s market value. Instead, lemon law authorizes manufacturers to process a buyback based on the original buying price.

So, how do you ensure the manufacturer refunds you every dollar guaranteed to you by lemon laws?

Here are the potential drawbacks of getting a fair manufacturer buyback.

Illegal Release Forms

Manufacturers use all means possible to suppress your rights. For instance, a manufacturer can trick you into signing a release form to stop your rights under lemon laws. Normally, release forms are used in the film, photography, music, and radio industries to avoid legal roadblocks that make it possible to withdraw their consent.

Fortunately, California lemon laws don’t require consumers to sign a release form to enjoy their rights— whether a refund or a replacement. Therefore, avoid any manufacturer who tries to convince you to sign a release form.

Unfavorable Mileage Offset

A manufacturer is legally allowed to deduct mileage offset from the manufacturer buyback value of your BMW. However, if an attorney does not represent a consumer during negotiation, the manufacturer may present an unfair figure for the mileage offset.

The manufacturer may also give the impression that the consumer has no right of appeal, regardless of how aggressive it seems.

Here’s how to calculate the mileage offset:

Mileage offset is the number of miles driven by the buyer from the date of purchase up to the first date of repair divided by 120,000(Miles). 120,000 is unique for the State of California, representing the average lifespan of a vehicle.

The number is then multiplied by the total amount paid by the consumer. For example, if you bought the vehicle for $15,000 and drove it 12,000 miles before the first repair.

Here’s what your mileage offset will be:

                          12,000/120,000= 0.1

                           0.1 * 15,000= $1,500

Remember the mileage offset formula to get the best from a manufacturer buyback.

Negative Equity

Negative equity occurs when you owe the bank more than the car’s actual value. It’s a usual occurrence in trade-ins, where the owner exchanges a vehicle with another with a higher loan book value than its market value.

If you traded in your BMW, the manufacturer might not pay you the negative equity from the previous vehicle.

Here’s how negative equity arises:

For example, your loan-financed BMW has a loan balance of $3,000. However, you trade that in and purchase a new vehicle worth $20,000 that turns out lemon. Even if the manufacturer buys the new car for a full $20,000, the loan balance($3,000) will remain.

If the manufacturer holds that position, you’ll owe the $3,000 for a vehicle you no longer own.

Manufacturer Arbitration

Manufacturer arbitration is also a potential drawback you need to watch out for because it can make a huge difference to the final payout. Usually, a manufacturer may encourage you to opt for arbitration as an ‘’affordable and quicker’’ way to process your buyback.

Unfortunately, manufacturers influence the hiring decision of an arbitrator, which affects the outcome of dispute resolution. If you opt for an arbitrator, the odds are stacked against you; you can either lose the claim or receive a low or insufficient offer.

Nonetheless, the decision reached during arbitration is not binding, opening a leeway to seek the court’s intervention. On the flip side, the manufacturer can use the deliberations of the arbitration to sue you in a civil case.

Maximizing Your Return: Tips for Negotiating a Fair Buyback Price with BMW

When issuing a lemon law buyback, a manufacturer should reimburse the entire vehicle cost, with less mileage offset. The manufacturer must also factor in incidental expenses such as accommodation, car rental, additional repair, and attorney fees.

Your attorney should therefore stay on top of their game to negotiate for an offer that reflects the pain and inconvenience of owning a defective BMW.

Here’s a list of valuable tips for negotiating a fair buyback price with BMW.

1: Familiarize Yourself With California Lemon Laws

The manufacturer will apply all means possible to frustrate your efforts of getting a deserved offer. On the other hand, anything you do or say can be used against you during the negotiation process.

If you are well acquainted with California lemon laws, you will make informed decisions contributing to a fair buyback price.

Here are a few lemon laws that can make a difference in your negotiation:

• Take the Vehicle to an Authorized Dealer: Lemon law requires consumers to take their vehicle to an authorized dealer as an opportunity to fix the defect. You also risk violating warranty terms if you take the vehicle for repairs to an unauthorized repair shop.

• Understand Arbitration and Court’s Process: Once you file a claim, the manufacturer will request you to use arbitration as an affordable and quick route to resolving the dispute. The arbitration route works in the manufacturer’s favor because they influence the hiring decision. Fortunately, you can get a better deal from the court with the help of an attorney.

2. Document Everything

Keep all the repair and purchase documents related to your defective BMW. Similar to all legal cases, the success of your negotiation lies in the availability of solid evidence.

Below is a list of the most relevant documents you’ll need to improve your chances in a buyback claim:

• Manufacturer’s Warranty: It’s an essential document attached to the owner’s manual and received when you purchase the vehicle. It also contains an express warranty with terms of conditions and length of coverage. If the buyback claim collapses, you can still pursue the manufacturer for breach of warranty terms.

• Purchase or Lease Document: You need the original purchase or lease document to prove ownership and interest in the vehicle. It also sets out the date of purchase, price, and items added in the aftermarket.

• Repair order: You’ll also need the repair order to establish a ‘’reasonable number of repair attempts.’’ A repair order is a document that an authorized dealer hands you when you drop off the vehicle for repairs. Ensure it accurately describes the vehicle defect, date, and mileage when the car was dropped.

• Repair Invoice: This is the document that the repair facility hands you when you pick up the vehicle after repairs. Ensure the repair shop has captured the problems with the car, completed repairs, date, mileage, and cost of repairs.

• Correspondence: Keep copies of letters you’ve sent to dealerships, manufacturers, and other third parties, such as state agencies. 

• Other Helpful Documents: Vital documents such as vehicle registration, accident history, car rental receipt, and maintenance records will enhance your claim.

3. Negotiate With the Help of a California Lemon Law Attorney

You’re better positioned to negotiate with a manufacturer with legal aid. Manufacturers have the financial muscle to hire highly experienced and knowledgeable attorneys, putting you at a disadvantage.

However, you can change your fortunes by hiring an experienced lemon law attorney. A lemon attorney knows how to apply lemon laws to your advantage. An attorney also understands how to hold the manufacturer accountable, what they’re willing to do, and how much a manufacturer is ready to offer.

Simply put, a California Lemon law attorney understands the right buttons to push to get a generous offer from a manufacturer, something you cannot achieve alone.

Besides representing you during negotiations, a lemon law attorney offers other benefits, including:

• Legal Advice: Pursuing a lemon claim is a complex and time-consuming matter, explaining why most people don’t know what to do or who to call when faced with a lemon law claim. However, if you hire a lawyer, you’ll benefit from the legal advice and guidance in the claim process.

• No Fees: If you’re worried about the fees required to process a buyback, a lemon lawyer will process your case for free. More importantly, lemon law attorneys work on a contingency basis, meaning they’ll get paid once the manufacturer settles.

• Build a Stronger Case: Lawyers always have their cases cut out— build a strong case, win a buyback claim, and get paid. They, therefore, put maximum effort into creating a compelling case that’s likely to settle. As a result, a lawyer is willing to work with you to gather data and supporting documentation and build the case.

Ultimately, having a professional working on your case will make your case stronger and maximize your return during negotiations.

4. Stay Organized and Prepared

Ensure all the required documentation is in one place and is easily accessible. It also helps to prepare a demand letter that states your expectations for the settlement.

5. Remain Calm and Persistent

Negotiating a manufacturer buyback is tedious and takes time. However, if you remain calm, firm, and persistent, you stand a better chance of reaching a favorable outcome.

Alternatives to a Buyback: Exploring Your Options When Dealing with a Defective BMW

California lemon laws state that if a dealer or manufacturer can’t repair or fix a serious warranty defect in your vehicle after a ‘’reasonable number of attempts’’, the manufacturer must either:

• Replace the vehicle or
• Refund the vehicle’s purchase price(Buyback)

Therefore, if you feel the drawbacks of a buyback might leave you worse off, consider pursuing a replacement.

A replacement occurs when the original but defective vehicle is replaced with a substantially identical model. The new car must be similar to all extents and purposes— including model, make, year, color, and interior. 

It should also have similar undercoating, rustproofing, and factory/dealer options. More importantly, the service contract, warranty terms, and specifications should also match. 

Like a buyback, the manufacturer should cater for sales tax, license, registration fees, and other official fees. The manufacturer should also refund you any incidental costs and attorney fees as awarded by the courts or arbitrator.

However, you’re required to pay ‘’offset for use’’ based on the mileage used before the first time of repair.

A vehicle replacement is the most suitable option for those who love everything about their vehicles apart from vehicle defects. Getting a replacement makes more sense than receiving the refund proceeds and using it to buy the same BMW.

How to Qualify For a Lemon Law Replacement

A BMW vehicle can qualify for lemon law protection if it has substantial defects that a manufacturer or dealer has failed to fix after a ‘’reasonable number of attempts.’’

How to Establish a ‘’Reasonable Number of Repair Attempts’’

There’s no set limit on reasonable attempts. However, California Lemon Law Presumption contains the following guidelines for determining whether a manufacturer has made a ‘’reasonable number of repair attempts.’’

• The dealer or manufacturer has fixed the vehicle defect after four or more repair attempts. 
• The car’s defect can cause death or serious injury if driven, and the manufacturer has made two unsuccessful repair attempts.
• The vehicle has been in the repair shop for more than 30 days—not necessarily consecutive for defects covered by warranty.

Substantial Defects that Qualify for a Replacement or a Refund

For a BMW  to qualify for lemon law protection, it should have been sold with a warranty and have a significant defect. Moreover, its malfunction should impair vehicle use, value, and safety.

Examples of substantial defects covered by lemon laws include:

• Airbags
• Loss of power steering
• Electrical problems
• Defective seat belts
• Defective engine computer
• Defective acceleration or transmission

Substantial defects that cannot qualify for a replacement or refund include:

• Malfunctions that originate from accidents
• A defect that doesn’t impair the vehicle’s value, safety, and use
• A defect caused by the owner’s negligence, e.g., poor use or improper maintenance
• Malfunctions caused by repairs or alterations from an-unauthorized dealers

Speak to an Experienced California Lemon Law Attorney

The experience of owning a lemon car is distasteful. A defective BMW has persistent and recurring problems that make it unreliable. In addition, its frequent breakdown makes it expensive to maintain and a safety hazard.

It, therefore, pays to work with a knowledgeable and experienced lemon law attorney to represent your interest in a buyback claim.

At LemonLaw123, our lead attorney Valerie Campbell has handled hundreds of lemon law cases with a 99% success rate, making us ready and confident to handle your case.

Contact us online or call us at 657.529.5239 for a free case review.