What Happens to Lemon Law Cars After They Are Repurchased?

After you’re done with a frustrating lemon car, what happens after it’s replaced or receiving a refund? Most people worry whether you will likely encounter a similar defective vehicle in the market.

Similarly, no one would like their friends or relatives to experience the pain of driving a lemon. Once a lemon vehicle is returned to a manufacturer, what happens next depends on the defect’s severity and the manufacturer’s intentions.

Contrary to popular opinion, few repurchased vehicles are taken to a junkyard. Instead, manufacturers repair and resell most of them through public auctions. A California lemon vehicle is any vehicle returned to the manufacturer on or after January 1st, 1996.

More importantly, a manufacturer must register the vehicle to their name before resale. Consider speaking to a trusted and reputable California lemon law attorney if you’re looking for sound advice concerning lemons and your rights. 

The Resale Market: Can Lemon Law Cars Be Sold Again After Repurchase?

The short answer is yes.

A manufacturer has every right to resell cars with titles of lemon law buybacks as long as they abide by California Lemon Laws. However, if they break the prescribed regulation of disposing of lemon buybacks, they can be charged for ‘lemon laundering.’

Regulations That Govern The Resale of Lemon Law Buybacks

Although a manufacturer can sell any vehicle repurchased due to a lemon law dispute, they must abide by the following rules:

  • The defective car should be repaired to conform to the original warranty terms.
  • The vehicle should bear the title ‘Lemon law buyback.’
  • The seller should disclose the title ‘lemon law buyback’ and the defects and repairs done to address the malfunction.

Interestingly, some manufacturers or dealers skip the above requirements, making the transaction illegal. For instance, an automaker may fail to disclose a lemon title or present it in a way that makes it difficult to disclose the vehicle defects history.

A manufacturer can only legalize the sale of buyback after conducting repairs, branding it, and disclosing the title to a prospective buyer.

Instances Where a Lemon Title is Removed From a Defective Vehicle

California Lemon laws require lemon law buyback titles to remain on the vehicle indefinitely. However, the title may disappear if the automaker transfers the car to a different state whose lemon law does not have those disclosure requirements. 

Once a vehicle with a defective title is transferred to a different state with a conflicting title requirement, the vehicle report develops some inconsistencies. Only seven states have used lemon laws, including Connecticut, New York, New Jersey, California, Massachusetts, New Mexico, and Minnesota.

Therefore, if an automaker in California transfers the vehicle to other states without branding requirements, they can successfully disguise the vehicle’s history. Alternatively, an automaker may repurchase a defective vehicle from a state without notification requirements, then resell it in another state, which can distinguish the buyer’s avenue to identify the vehicle’s history.

How Does the Lemon Title Affect Vehicle’s History

There are many suggestions that a lemon title can affect a vehicle’s warranty which is untrue. The warranty terms and duration bind a manufacturer. Therefore, despite the car’s status, they must honor the guarantee to the full-time. 

Interestingly, if the vehicle defect has been subjected to a recall, a manufacturer may offer an extended warranty for the defective part.

How to Avoid Buying a Lemon

Avoid buying lemon vehicles at all costs. 

Lemon vehicles have discounted prices that entice consumers looking to acquire used units for a reasonable price. Usually, people who buy lemon vehicles find comfort if the defect seems minor.

Even so, remember that the manufacturer was given a ‘reasonable number of attempts’ to fix the vehicle before the repurchase but could not fix it.

If you’re looking to buy a used vehicle, here are a few tips to protect yourself from buying a lemon vehicle.

Request For a Vehicle History Report

Most sellers will give a vehicle history report free of charge on request. Alternatively, you can fetch the same report at a fee from approved providers like National Motor Vehicle Title Information System or other private providers, Carfax or AutoCheck.

The vehicle history report is an excellent way to identify potential red flags in the vehicle. The report provides pointers like accidents and claims, automaker recalls, change of ownership, and odometer readings.

Go For a Test Drive

If you’re satisfied the vehicle looks good on paper, it’s time to get behind the wheel and do a test drive. Most defects are hard to disguise when the vehicle is running. After you ignite the car and the engine is running, use the following checklist to assess it:

  • Step on the Gas: Step the engine’s ability while it’s still parked to assess whether it has power. Once you start driving, check how the engine responds when you press the gas, it should speed without a struggle or shift.
  • Check the Steering Wheel: The steering wheel should be steady; a slight movement, an inch or so, should change the vehicle’s direction.
  • Test essential amenities like air conditioner, heater, interior lights, power seats, and windows to see if they work.

Inspect the Exteriors

Assess if the vehicle’s body has dents, scratches, or dings. Also, check for rust spots— a small site of rust could signify upcoming damage. Then, open all doors and hinges to ensure they’re working correctly.

Lastly, check for any uneven tire tread wear signs indicating the vehicle is out of alignment.

Get an Independent Inspection

Once the vehicle passes all your initial assessments, get it evaluated by an independent mechanic. Request a trusted mechanic to assess crucial aspects like engine, exhaust, brakes, and transmission. 

An independent inspection will spot issues and diagnose problems you couldn’t find.

Salvage or Scrap? How Lemon Law Cars Are Handled After Repurchase

Whether the vehicle is declared a scrap or salvage depends on the state of the vehicle. It’s rare for an automaker to report a car ‘scrap’ and eventually destroy it. Instead, many manufacturers opt to recondition them and resell them.

Even so, there are potential risks in dealing with salvage vehicles because automakers intentionally sell them to other states without using lemon laws. Cars may also be branded ‘salvage’ after an insurance company termed the vehicle total loss.

‘’Salvage’’ vehicles are printed in bold letters across the top of the title where no one can miss them. It’s worth noting that fewer than a third of the states require any form of branding, which means making it difficult to identify a repurchased vehicle.

Reconditioning or Destruction: What Happens to Lemon Law Cars Depends on State Laws

It’s easy to conclude that a manufacturer will destroy a vehicle after repurchase— however, that’s not the case in California. Automakers in California have the leeway to repair and resell a lemon vehicle.

Even so, the following caveats — that apply in California and six other states—define how repurchased vehicles enter back into the market.

  • Include the manufacturer’s name in the title
  • Attach a decal on the vehicle that reads ‘’Lemon Law Buyback.’’
  • A manufacturer must request a California Certificate of Title or Registration Certificate to be marked ‘’Lemon Law Buyback.’’
  • Send a notification to the buyer with a letter-sized paper on the nature of each non-conformity reported by the original buyer and repair attempts made to correct the nonconformity.

Environmental Impact: How Lemon Law Cars Are Disposed of Responsibly

After an automaker has declared a specific vehicle as scrap, it can only dispose of it following guidelines provided by the  U.S Environmental Protection Agency (EPA). Lemon cars should be disposed of safely by removing hazardous material so discarded units can be safely stored and processed.

Responsible disposal promotes worker safety. It also mitigates risk exposure to public health and the environment.

Usually, each manufacturer has a national collection system and treatment facility in every city or council area. The treatment facility should be large enough to accommodate different activities required to process and prepare discarded vehicles.

For instance, the first activity involves accepting and storing discarded vehicles. A manufacturer must treat a scrap car within ten days after depositing it into the facility.

Treatment of vehicles includes the following procedures:

  • Removing the battery or batteries
  • Removing any components containing mercury
  • Neutralizing or removing potentially explosive parts, including airbags
  • Removing, collecting, and storing fuel, oils, and other car fluids

The vehicle is also dismantled to remove usable and recyclable parts. Then vehicle hulks are stored, awaiting crushing and shredding in metal crushing facilities.

Speak to an Experienced California Lemon Law Attorney

Don’t let a defective vehicle continue being a thorn in the flesh. Our attorneys know all the intricacies of California lemon laws protecting consumers who accidentally buy defective cars. 

Speak to our team because you may receive a full refund, replacement, or significant compensation.

At LemonLaw123, we confidently take on any case because our lead attorney Valerie G. Fernadez Campbell has a 99% success rate.

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

Valerie G. Fernandez Campbell

Valerie G. Fernandez Campbell, known as The Lemon Law Lady, has dedicated her entire legal career to the specialized field of Lemon Law, a journey that began immediately after her
graduation from UCLA School of Law.

With a 99% success rate and a policy of no fees unless you win, her practice stands as a testament to her expertise in California’s Lemon Law, her commitment to her clients, and her unwavering dedication to justice and consumer rights.

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This page has been written, edited, and reviewed by a team of legal writers following our comprehensive editorial guidelines. This page was approved by attorney Valerie G. Fernandez Campbell, personally handled over 500 lemon law cases and settlements.