California Lets You Return A Used Car In Three Days, But It Could Cost $750

It’s no secret that the used-car market can be a bit fickle. One can spend weeks researching, scouring the market, only to end up buying a car that reveals a troubling secret on the drive home. Now, California is aiming to protect buyers with a three-day window to change their minds after purchase. The state’s Combating Auto Retail Scams Act took effect October 1, making returns an automatic right for qualifying used vehicles priced at $50,000 or less. Just don’t mistake it for a free weekend rental.

As California’s DMV explains, the rule applies to purchases and leases through licensed dealers. Buyers no longer have to pay in advance for a separate cancellation option. The three-calendar-day clock starts the day after the contract is signed, and weekends count. If the dealership is closed on the final day, the deadline moves to its next open day.

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There are limits. The buyer must bring the vehicle back to the selling dealer during business hours after driving no more than 400 miles (644 km). It must be in essentially the same condition, although reasonable wear and mechanical problems that appear after delivery without the buyer causing them do not invalidate the return. New cars, private-party sales, motorcycles, and qualifying auction sales are excluded.

Importantly, there’s one notable catch, and it comes in the form of up to $750. The dealer can charge a restocking fee equal to 1.5 % of the vehicle’s sale price, with a $200 minimum and $600 maximum. Drive more than 250 miles (402 km), and it can add $1 per mile beyond that point, up to another $150. Returning a $40,000 car after 400 miles could therefore cost $750. If the dealer charged for shipping, it can retain its actual shipping cost instead of the basic restocking fee, subject to the same cap.

The law also addresses trade-ins. Dealers generally must give yours back. If they have sold it or started transferring its title, they must pay the greatest of its agreed trade-in value, sale price, or fair market value, subject to any outstanding loan. They generally have 48 hours after a valid cancellation to undo the contract and issue the refund, though payment verification can delay that deadline.

We covered the law when it was signed last year. Now it is in force, along with rules requiring clearer total prices and restricting unwanted or worthless add-ons. California estimates the pricing provisions could save buyers $234 million annually. Ultimately, the return provision gives an individual shopper something more important. A way out of a purchase that looked better on the lot.

Lead Photo: Stephen Rivers for Carscoops