California runs two entirely separate vehicle buy back programs, and they get confused constantly. The California Lemon Law requires a manufacturer to repurchase a defective new vehicle and refund essentially the full purchase price, minus a deduction for miles driven before the first repair attempt. The Consumer Assistance Program (CAP), run by the Bureau of Automotive Repair, pays $1,350 to $2,000 to voluntarily retire an older high-polluting car. Different statutes, different eligibility, different money. Which one applies to you depends entirely on whether your problem is a broken vehicle or an old one.
When a Vehicle Qualifies as a Lemon
A vehicle is a lemon when it has a defect that substantially impairs its use, value, or safety, and the manufacturer has been unable to fix it after a reasonable number of attempts. The defect has to show up while the original manufacturer’s warranty is still in effect. Cosmetic or trivial issues don’t count.
California law creates a legal presumption that the manufacturer has had enough chances if any of the following happens within the first 18 months of delivery or 18,000 odometer miles, whichever comes first:
- The same defect has gone in for repair four or more times without being fixed, and you have directly notified the manufacturer at least once.
- The defect could cause death or serious bodily injury, and it has gone in for repair at least two times, again with at least one direct notification to the manufacturer.
- The vehicle has been out of service for warranty repairs for a combined total of more than 30 calendar days, regardless of how many separate problems caused the visits.
The direct-notification piece trips people up. Dropping the car off at the dealer is not the same as notifying the manufacturer. The manufacturer itself needs notice, but only if it clearly disclosed that requirement in the warranty or owner’s manual.1California Legislative Information. California Civil Code 1793.22 If it didn’t, you can rely on the presumption without having sent a separate letter.
Hitting these thresholds shifts the burden to the manufacturer to prove the car isn’t a lemon. A defect discovered after the 18/18,000 window can still support a claim as long as the warranty hasn’t expired, but you lose the presumption and have to prove the manufacturer had a reasonable chance to fix things.
What the Manufacturer Has to Pay
Once a vehicle is confirmed as a lemon, the manufacturer must offer you a choice: replace the car with a substantially identical new one, or refund the purchase price. You pick. The manufacturer cannot force you into a replacement.
A refund covers:
- The actual purchase price you paid or still owe, including down payment, monthly loan payments, transportation charges, and manufacturer-installed options. Aftermarket accessories you or the dealer added later are excluded.
- Collateral charges such as sales tax, license fees, and registration fees.
- Incidental damages caused by the defect, including towing and rental car costs.
If a loan is still open, the manufacturer pays off the balance directly to your lender.2California Legislative Information. California Civil Code 1793.2 Choosing a replacement instead gets you a new vehicle of the same make and model with full warranties, and the manufacturer covers sales tax, registration, and license fees on the replacement.
The Mileage Offset
Whichever option you take, the manufacturer can deduct a mileage offset for the use you got out of the vehicle before the first repair attempt for the qualifying defect. The formula: purchase price × (miles at first repair visit ÷ 120,000).2California Legislative Information. California Civil Code 1793.2
On a $40,000 vehicle with 5,000 miles at the first repair visit, that’s $40,000 × (5,000 ÷ 120,000) = $1,666.67. Only pre-first-repair miles count. If you brought it in at 2,000 miles, the offset drops to $666.67. This is why documenting your first repair visit matters more than almost anything else in a lemon law file.
Attorney Fees and Civil Penalties
California’s lemon law shifts fees. Win the case and the manufacturer pays your attorney’s fees and litigation costs on top of the buyback amount. That is why most lemon law attorneys work on contingency with no upfront cost to you.3California Legislative Information. California Civil Code 1794
If the manufacturer’s refusal to buy the vehicle back was willful, the court can add a civil penalty of up to two times your actual damages. On a $40,000 car, that’s up to $80,000 in penalties on top of the refund itself. Manufacturers can avoid the penalty by running a state-certified third-party arbitration program that complies with California law, or by completing the buyback within 30 days of receiving a written demand.
How to Pursue a Lemon Law Buyback
Start with a written demand to the manufacturer requesting a buyback or replacement. Under procedures established by SB 26, if you send that demand at least 30 days before filing suit, the manufacturer must offer restitution or replacement within 30 days of receiving your notice and complete the transaction within 60 days. Miss those deadlines and you can sell the vehicle and sue for damages.4California Department of Consumer Affairs. New Lemon Law Procedures – Arbitration Certification Program
Some manufacturers run state-certified arbitration programs that resolve disputes before they hit court. These programs are free to consumers and faster than litigation, and not every manufacturer participates.5California Department of Consumer Affairs. Arbitration Certification Program California does not require arbitration before you file a lawsuit, but going through the process can strengthen your position if talks stall.
The statute of limitations for a lemon law claim is generally four years. Because the strongest claims rely on the 18-month/18,000-mile presumption window, acting early both preserves your rights and produces a cleaner repair record.
Used and Leased Vehicles
The presumption and buyback rules above are written for new motor vehicles. California extends warranty protections to used vehicles sold with an express warranty from a dealer or distributor, and in that case the dealer carries the same obligations a manufacturer would. Implied warranty coverage on used vehicles lasts as long as the express warranty, but never less than 30 days or more than three months.6California Legislative Information. California Civil Code – Article 3, Section 1795.5 Leased vehicles are covered the same as purchased ones. The law applies to vehicles purchased or leased for personal, family, or household purposes, and to business vehicles if the business operates fewer than five vehicles and the vehicle weighs under 10,000 pounds.7California Department of Consumer Affairs. California Lemon Law Q&A
The Consumer Assistance Program Vehicle Retirement Option
CAP is a completely different animal. Administered by the Bureau of Automotive Repair, it pays vehicle owners to permanently retire older, high-polluting cars. Nothing about it involves defects or warranties. The point is to get dirty vehicles off the road.
To qualify, the vehicle must:
- Be a passenger vehicle, truck, SUV, or van with a gross vehicle weight rating of 10,000 pounds or less.
- Have been registered with the California DMV without any registration lapse of more than 120 days during the two consecutive years before the current registration sticker’s expiration date.
- Actually run. You need to be able to drive it under its own power to the contracted dismantler, including forward at least 10 yards.
A brief registration lapse of a couple months won’t disqualify you, but anything over 120 days in that two-year window will.8Bureau of Automotive Repair. Retire Your Vehicle
How Much CAP Pays
The amount depends on household income and whether the vehicle passed or failed its most recent smog inspection:
- $1,350 with no income limit, if the vehicle failed its most recent Smog Check.
- $1,500 if your gross household income is at or below 225% of the federal poverty level and the vehicle has a completed Smog Check within 180 days of applying (pass or fail).
- $2,000 if you meet the same income limit and the vehicle failed its most recent Smog Check.
For income-eligible owners, the practical distinction between the top two tiers is whether the car actually failed. A pass still gets you $1,500; a fail gets $2,000.8Bureau of Automotive Repair. Retire Your Vehicle For reference, 225% of the 2026 federal poverty level is $35,910 for a single person and $74,250 for a family of four.9U.S. Department of Health and Human Services. 2026 Poverty Guidelines
Applying and Getting Paid
Applications go through the Bureau of Automotive Repair online. You’ll provide vehicle information, smog inspection results, and household income documentation if you’re going for one of the higher tiers.10Bureau of Automotive Repair. Consumer Assistance Program Application
If approved, BAR mails a letter of eligibility with an expiration date. Before that date, drive the vehicle to a BAR-contracted dismantler with:
- The letter of eligibility
- The vehicle title in your name
- Current registration
- A government-issued photo ID
The dismantler confirms the car is operational and that your paperwork matches, then the state processes your payment. There’s a cap of one vehicle retired per sole owner, or two per joint owner, in any 12-month period.