The Average Lemon Law Settlement in California

The Average Lemon Law Settlement in California

Do you own a defective vehicle in California that can’t be repaired? There’s no reason to be stuck with that lemon any longer! Whether you purchased or leased a lemon car, you may be due compensation. While there’s no set compensation rate, it’s fair to expect a refund if your vehicle doesn’t operate as it should, either in the form of a replacement vehicle or cash compensation for the car. Lemon settlement in California can range from $5,000 to $100,000 and depend on a few factors, while the average tends to be between $40,000 to $50,000.

If you want to increase the average lemon law settlement you could receive, it’s time to get a California Lemon Law Attorney on your team. After winning thousands of cases for our customers are more than capable of getting you the compensation you deserve. There’s no reason to wait any longer when we offer a free consultation and won’t charge you anything unless you win your case. You deserve expert lemon law protection like that of The Lemon Pros for your claim.

In this article, we’ll dive deeper into California Lemon Law and review the typical lemon law settlements. We’ll explain the factors affecting your lemon law settlement and give tips to maximize the payout.

California’s Lemon Law Claims

California's Lemon Law Claims

California Lemon Law is a consumer protection law that safeguards people who purchased qualifying new or used cars with a defect. These defects can be mechanical or safety-related. Under these lemon law protections, consumers can get compensation and get out from under the commitment.

There are several remedies and resolutions available, depending on the situation. In some cases, a replacement vehicle is offered by the manufacturer that is of equal value. Other times, it’s more appropriate for the manufacturer to pay the consumer a settlement for the costs incurred. However, the vehicle must first qualify as a lemon car.

And what makes a car a lemon? For a car to be a lemon vehicle, it must have significant defects that impact its use, value, and safety. These defects are unrepairable, even after attempts by the dealership. The lemon car must be under warranty coverage and claims must be made within 18 months of taking possession of the vehicle. Not every vehicle with a mechanical problem is going to be considered a lemon.

However, does your car qualify as a lemon? While there are many guidelines to keep in mind, here are a few of the most critical to consider:

  • The manufacturer (dealership) has attempted at least two times to repair a warranty problem that could cause serious injury or death
  • The manufacturer (dealership) has attempted at least four times to repair the same warranty claim
  • The motor vehicle has been out of service for more than 30 calendar days for repair (doesn’t need to be consecutive)

You may think that because the dealership is still working on your vehicle to fix the defect that you have no legal recourse, but that’s not always the case. Dealerships may only hold your vehicle for a certain amount of time for each lemon repair.

Ultimately, how long can a dealership hold your car for repair?It is irrelevant how many times your vehicle is in the dealership for repairs. What matters is how many days it is out of service for the same complaint, even if during multiple visits. Therefore, if the dealership has your car for thirty days or more to fix the same problem, even if you had the vehicle back four times, you may be due compensation. There’s also the consideration of what types of problems the lemon car is struggling with.

What types of problems are covered by the Lemon Law? Most people associate lemon law with critical malfunctions, such as engine failure or transmission trouble, and similar dire problems. However, the problem doesn’t need to be life-threatening to be considered a lemon vehicle. It can be any defect that substantially diminishes the value, impairs safety or reduces vehicle use. That’s why structural defects, rust and corrosion, electrical system complaints, and power-related issues are all covered.

What are the Average Lemon Law Settlements in California?

What are the Average Lemon Law Settlements in California?

The short answer is that there is no way to determine the average lemon law settlement in California because too many factors are involved. However, we can tell you some amounts that we typically see based on unique factors.

For example, we’ve gotten high-end cash settlements totaling well over $100,000 because the defective vehicles were valued high and there were many expenses to account for. We’ve also seen settlements as low as $5,000 because the defects weren’t life-threatening and customers were willing to live with the problem.

Probably a good average between these two would be in the range of $40,000 to $50,000.

By now you may be asking, how are these estimates of moderate settlements figured? The average new car price in 2023 was $47,000. You would expect about 10% of the average new car price for a low-price settlement, making it around $5,000. An average settlement would cover the purchase price of the vehicle, plus registration fees, taxes, and any other expenses.

For that reason, we were able to price that around $50,000. Obviously, the higher settlements are for situations where the car cost is more or additional expenses need to be covered, such as rental car costs, towing invoices, and outstanding repair bills.

To get the maximum settlement, you may not even need to go to court. It’s possible to get maximum compensation simply through mediation with the manufacturer.

How to Maximize Your Lemon Law Settlement

How to Maximize Your Lemon Law Settlement

Certain steps you take can dramatically change how much money you receive, which is why it’s critical to follow the advice of California lemon law attorneys to ensure you get every penny you are entitled to. A lemon law case has many variables that can change the outcome. For that reason, we encourage you to follow these important tips to maximize the potential for a high settlement.

1. Keep Detailed Records

You should have a record of every repair, receipt, and communication about the issues. On your documents, make sure you have the names of the people you’ve spoken to, the date, the time, and the outcome.

2. Take Your Car to the Dealership for All Warranty Repairs

While your car is under warranty, it’s critical that you visit the authorized dealer for repairs. Unauthorized repairs can be denied by the manufacturer and may have no standing during lemon law claims. You don’t want to go through the entire lemon law claims process just to find out that you didn’t perform due diligence by having the repair attempts at the dealership’s service department.

3. Be Patient But Assertive

You can’t expect the car repairs to be done overnight, but you don’t have to sit around and wait forever. Stay on top of the dealership and check in often. Ensure the organization knows you are entitled to answers and you aren’t going away easily.

4. Use an Experienced Lemon Law Attorney

If you don’t know your rights, you’ll have a hard time enforcing them. With the help of our professional lemon law lawyers, your rights are protected and you will see results. Having the right lemon law attorney on your side could make the difference between getting a low and high settlement offer.

5. Don’t Settle for a Low Offer

If the manufacturer comes back with a low-ball offer in hopes that you will take it, you don’t have to concede. As long as there is a reason to go for more, your California lemon law attorney will re-negotiate the offer and try to get a higher settlement. Whether you want a certified pre-owned vehicle as a replacement or you hope for a new vehicle, we can help you file a successful claim that protects your legal rights. The key to successful negotiation is to keep your emotions in check. It’s difficult to succeed if you let fear or worry overcome you.

Factors Influencing Lemon Law Settlements

Factors Influencing Lemon Law Settlements

The average lemon law settlement in California can be influenced by various factors, all of which play a part in how much you are entitled to. Here are just a few of the factors to consider.

1. Severity of Defects: The frequency and seriousness of the defects play a huge role in what’s owed. Severe defects that could lead to a life-threatening issue or performance problems that significantly affect how the car can be used are going to bring in a bigger settlement than a simple electrical system problem.

2. Documentation On Hand: As previously discussed, documentation is the key to getting a great payout. If you have communications between you and the manufacturer showing that you’ve attempted to get the problem repaired, you can expect a bigger settlement. On the other hand, if your case isn’t strong, you may have to settle for a lower amount.

3. Ownership Duration: Settlement amounts are deeply affected by how long you’ve had the vehicle in your possession and how many miles are on the odometer. Longer ownership times are going to create higher settlements if the defects have persisted most of the time. With that said, you don’t want to wait to file your legal lemon law claim just to try and get more money. A skilled lemon law attorney will advise you to file for your refund or replacement vehicle immediately.

4. Value of Vehicle/Fees: As we touched on above, the value of the vehicle is the basis for how much you will get back. There are also other fees that need to be added, including any interest payments you’ve already put out, taxes, registration fees, and administrative costs. Your legal costs will also be factored in.

5. Your Expectations: The final factor comes down to what you expect. If you are happy with a low settlement, then that’s probably what you will get because you won’t re-negotiate after receiving a small cash settlement offer. On the other hand, those hoping for a larger settlement are going to push harder and may succeed in getting more. Only a qualified lemon law lawyer will know how to win compensation for a substantial defect or multiple repair attempts. From crafting the perfect demand letter to negotiating terms, we can steer you toward a successful lemon law claim.

Beyond the Settlement: What Comes Next?

Beyond the Settlement: What Comes Next?

Settlements come in many forms. You may receive one of the following:

Car replacement of equal value: According to the state’s lemon law, you are entitled to a replacement vehicle similar to what you already have. This may be given to you as one of the certified pre-owned vehicles or a used car, depending on what your car price is valued at.

Refund of the purchase price and fees: Per the Lemon Law buyback warranty, you may be given back the vehicle’s purchase price along with any other fees you incurred. The manufacturer may pay the remaining loan balance and give you the remainder based on mileage offset.

Additional repair attempts: Even if there have already been a reasonable number of attempts to repair your faulty vehicle, the manufacturer may ask you to try again. There may be new information available since the initial warranty repair attempt that could fix the defect. If so, no more legal recourse would be needed because you would finally have a fixed vehicle.

“Cash and Keep” settlement: With the cash and keep agreement, you get compensated for the faulty car but you must keep it. If the consumer retains custody of the vehicle, there can not be any more lemon law cases brought against the manufacturer. Instead, you are taking a California lemon law settlement and agreeing to be content.

Extended service contract: An option for Lemon Law compensation is to receive an extended service contract in addition to the original manufacturer warranty.

There are also situations where you are offered nothing, although that’s rare when you have a qualified lemon law professional on your side.

Assuming that your car qualifies for a lemon law settlement offer, what happens next? Do you have to pay taxes on a lemon law settlement? According to TurboTax, there are some situations when there’s no reason to file because it’s considered a loss. However, only a tax professional can help you follow the right path.

Additionally, are you bound by the consumer lemon law to never file another claim or can you file more than one lemon law claim? If there are multiple defects on the same vehicle, you may be able to file additional claims. You can also file more than one claim on separate vehicles if you are unlucky enough to get multiple lemons.

Avoiding Lemon Law Claim Pitfalls

Avoiding Lemon Law Claim Pitfalls

Here are some of the biggest mistakes we see when helping clients with a lemon law repurchase.

  • Not keeping enough documentation
  • Settling for less than what is deserved
  • Waiting too long to file a claim
  • Assuming that the problem isn’t covered by California’s lemon laws

Many people assume that filing a lemon law claim is going to be time-consuming and not worth the effort in the end, but that’s not normally the case. There are legal remedies for qualified cars that have a defect and it may not cost you anything to find out what you are entitled to.

For all these reasons, having a good lemon law attorney on your side is critical. Our professional legal services help you get the highest settlement and ensure compliance with all legal requirements so the case doesn’t get tossed out.  

Get Compensated for Your Lemon Vehicle

Understanding the different types of lemon law settlements makes you better prepared for what’s to come. With the help of your lemon law attorney, you will get the highest settlement possible.

Call us to meet with an experienced lemon car lawyer in California. We’ve helped countless other clients achieve settlements in the high range and have strategically negotiated with manufacturers to get a better payout. You have nothing to lose by getting your free Lemon Law Consultation.

We are ready to help you at our premiere Lemon Law Attorney Practice in Beverly Hills.

Call us today for a free consultation before time runs out to pursue your claim.

Phone: (800) 917-7147

Email: info@thelemonpros.com

Why Choose The Lemon Pros?

Our specialty is Lemon Law, that is why we only handle Lemon Law claims. When you hire us, our attorneys will do all the legal work for you, because we understand the stress that consumers like you deal with when they have a Lemon.

We have an excellent success record in representing consumers just like you! We are award winning attorneys, but that has not gotten to our heads. We are attorneys who care and give personalized attention to each and every client, our attorneys directly handle your claim.

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