Alabama Lemon Law Refund Calculator

How the Alabama buyback is calculated

Under the Alabama Lemon Law.

• If, after reasonable attempts, the manufacturer cannot fix a condition that first occurred in the first year or 12,000 miles, you choose between a comparable new vehicle and a refund.
• The refund includes the full contract price (with undercoating, dealer preparation, transportation charges and installed options, plus the nonrefundable portions of extended warranties and service contracts), all collateral charges such as sales tax and license and registration fees, and finance charges you incurred after you first reported the problem.
• It also includes incidental damages, which include the reasonable cost of alternative transportation while you were without the vehicle because of the problem. Refunds are made to you and any lienholders as their interests appear.
• A reasonable allowance for your use is subtracted. The statute sets it as the full purchase price multiplied by a fraction: 100,000 on the bottom and, on top, the miles the vehicle travelled before your first report of the problem. Only miles before that first report count.
• On a $30,000 vehicle with 8,000 miles at the first report, the allowance is $30,000 x 8,000 / 100,000 = $2,400. The calculator uses the price and options you enter as the full purchase price, which is our reading, so treat the result as an estimate.
• If it is determined that the manufacturer has breached its obligations under the act, you are also entitled to an additional award for reasonable attorneys fees. The act provides no multiplied damages.

Alabama lemon law: frequently asked questions

How does Alabama calculate the deduction for my use of the vehicle?

The statute multiplies the full purchase price of the vehicle by a fraction. The bottom of the fraction is 100,000 and the top is the number of miles the vehicle travelled before the first report of the problem to the manufacturer, its agent or an authorized dealer. Miles driven after that first report are not part of the allowance.

What does an Alabama refund include besides the price?

The full contract price with undercoating, dealer preparation, transportation charges and installed options, plus the nonrefundable portions of extended warranties and service contracts. It also includes all collateral charges such as sales tax and license and registration fees, finance charges you incurred after you first reported the problem, and incidental damages including the reasonable cost of alternative transportation.

Can I get a replacement vehicle instead of a refund?

Yes. The choice is yours: after reasonable attempts the manufacturer must, at your option, replace the vehicle with a comparable new motor vehicle or accept its return and refund the items above. The act does not say how tax is treated on a replacement.

Do I pay my attorney out of the refund?

If the manufacturer is determined to have breached its obligations under the act, you are entitled to recover, in addition to the replacement or refund, an additional award for reasonable attorneys fees. Whether you owe your own lawyer anything is a matter for your agreement with that lawyer.

Does the calculator work for a lease?

The act has no lease refund provision: it refunds "the full contract price" to the consumer, and says nothing about a lease. For a lease the calculator uses what you paid (cap-cost reduction, payments, deposit) in place of the price, which is a stand-in, not a statutory figure, so treat the result as a rough guide and ask an attorney.

Does Alabama add penalties or multiplied damages?

No. The act has no penalty, multiplied damages or flat award. Its only additional award is for reasonable attorneys fees, if the manufacturer is determined to have breached its obligations.