Ford Buyback: Replacement or Refund.... What is better?

Hey guys... wanted to get some feedback as I am just going through the RAV team process right now.

After taking my car in 8 times with the AC Unit burning out in my 2016 EB PP, I called Ford Support and told them I was potentially seeking Lemon Law as a last resort. Almost immediately I was put on hold and then read the basic standard terms of what would happen next.

So I still ended up dropping my car off at the dealership to see if they could fix the issue and I was in a rental for a week.

A week later, I get a call from the RAV team stating they are processing my refund and need additional information. (Mind you, I hadn't even received a response from my original complaint at all). The next day I received the customer letter giving me the option for Replacement or Refund.

Although I havent received a detailed offer... what would be the best route?

Replacement Vehicle - Based on the letter it states that if I get same make, model, & trim they can upgrade me. Does that mean, for example, I can get a brand new '18 model with same everything and have the same amount of payments left on the car minus the usage fee?

Or should the Refund be the better route to go?

This is all new to me, but any insight is appreciated!

I'm following this since I'm in the same situation. My offer letter is being sent out by Ford.

I'm leaning towards getting a refund then do a straight purchase. But since 2019's are coming out in a few months, I may do a trade since there will be lots of time to sort through all the headache but it will be frustrating based on others' experiences with a trade. I do not want another 2018 model that's for sure.

RTRFan said:

Hey guys... wanted to get some feedback as I am just going through the RAV team process right now.

After taking my car in 8 times with the AC Unit burning out in my 2016 EB PP, I called Ford Support and told them I was potentially seeking Lemon Law as a last resort. Almost immediately I was put on hold and then read the basic standard terms of what would happen next.

So I still ended up dropping my car off at the dealership to see if they could fix the issue and I was in a rental for a week.

A week later, I get a call from the RAV team stating they are processing my refund and need additional information. (Mind you, I hadn't even received a response from my original complaint at all). The next day I received the customer letter giving me the option for Replacement or Refund.

Although I havent received a detailed offer... what would be the best route?

Replacement Vehicle - Based on the letter it states that if I get same make, model, & trim they can upgrade me. Does that mean, for example, I can get a brand new '18 model with same everything and have the same amount of payments left on the car minus the usage fee?

Or should the Refund be the better route to go?

This is all new to me, but any insight is appreciated!

Click to expand...

It really depends what you want to do. If you do a vehicle replacement(with no change to your current loan, if the lender can just swap collateral) it would be a straight MSRP to MSRP swap.

So, if your current car had an MSRP value of $30,000(just throwing a number out there), then the new vehicle HAS to have the SAME msrp. If your lender cannot swap collateral, you would have to take out a new loan. If there is a difference in price(new vehicle MSRP is more than old vehicle MSRP) you would have to pay that out of pocket, or take out a completely new loan.

In that scenario, you will NOT be allowed to take advantage of any rebates, discounts, etc. Its a straight swap, lender does a collateral swap and thats that. You may have to pay usage fees out of pocket as well.


If you do a buyback, Ford will repurchase the vehicle for its MSRP value, minus mileage fees(if applicable) etc etc. That depends on your state as to what fees you will have to pay. In this case, as long as you owe less than the msrp and fees combined, you wouldnt have to pay anything out of pocket.



In my case, I chose a replacement vehicle, and here is how mine broke down.


Amount owed on 2017 - 36,000(I had some rollover and it was a recent purchase

MSRP of 2017 - 34,250

Replacement vehicle (2018) MSRP - $40,450


36,000 - 34,250 = 1750 difference (My state does not charge mileage fees ONLY if you are replacing, buyback in my state and you pay fees)


1750 + 40,450 = 42250 + tax on the difference between the two vehicles(489) = 42689


42,689 - 2000 down = 40,689 financed


In my case, because I owed more than the MSRP, I could have rolled the difference into the loan, but, I chose to (mostly) cover the difference.

The nice part is that when I bought my 2017, I traded a vehicle with a LOT of negative equity. I actually financed 39k on my base(shitty but worth it to me to go from a pickup to a "fun" car. So, with the 2018, my new loan payment is just a hair higher(a few dollars), but I upgraded massively(2017 base gt to a 2018 performance pack gt)


The way that ford does the numbers, and figures is very goofy, and It wont make sense. I was told that the NEW loan I took out, I had to get approved for enough to cover the MSRP of the OLD vehicle, PLUS the difference between the two vehicles(plus fees if applicable)

The check that the RAV department cuts to the dealer covers the new vehicle(minus the difference that you pay out of pocket)

Not sure why they do it that way, but thats the way they explained it to me.

17LightningGT said:

If you do a buyback, Ford will repurchase the vehicle for its MSRP value, minus mileage fees(if applicable) etc etc.

Click to expand...

Is that correct? I am pretty sure I read that they purchase it for the selling price plus taxes and fees, not MSRP.

Also, I read that with a replacement vehicle, you are still responsible for the dealer fees on the new car. Not sure how that would work though.

RTRFan said:

Hey guys... wanted to get some feedback as I am just going through the RAV team process right now.

After taking my car in 8 times with the AC Unit burning out in my 2016 EB PP, I called Ford Support and told them I was potentially seeking Lemon Law as a last resort. Almost immediately I was put on hold and then read the basic standard terms of what would happen next.

So I still ended up dropping my car off at the dealership to see if they could fix the issue and I was in a rental for a week.

A week later, I get a call from the RAV team stating they are processing my refund and need additional information. (Mind you, I hadn't even received a response from my original complaint at all). The next day I received the customer letter giving me the option for Replacement or Refund.

Although I havent received a detailed offer... what would be the best route?

Replacement Vehicle - Based on the letter it states that if I get same make, model, & trim they can upgrade me. Does that mean, for example, I can get a brand new '18 model with same everything and have the same amount of payments left on the car minus the usage fee?

Or should the Refund be the better route to go?

This is all new to me, but any insight is appreciated!

Click to expand...

What does your letter say with regard to a Refund?

Nanashii said:

Is that correct? I am pretty sure I read that they purchase it for the selling price plus taxes and fees, not MSRP.

Also, I read that with a replacement vehicle, you are still responsible for the dealer fees on the new car. Not sure how that would work though.

Click to expand...

As far as I know, it is MSRP in any case.

I paid 32 and some change for my 2017, they gave me 34,250 for it under buyback.

17LightningGT said:

It really depends what you want to do. If you do a vehicle replacement(with no change to your current loan, if the lender can just swap collateral) it would be a straight MSRP to MSRP swap.

So, if your current car had an MSRP value of $30,000(just throwing a number out there), then the new vehicle HAS to have the SAME msrp. If your lender cannot swap collateral, you would have to take out a new loan. If there is a difference in price(new vehicle MSRP is more than old vehicle MSRP) you would have to pay that out of pocket, or take out a completely new loan.

In that scenario, you will NOT be allowed to take advantage of any rebates, discounts, etc. Its a straight swap, lender does a collateral swap and thats that. You may have to pay usage fees out of pocket as well.


If you do a buyback, Ford will repurchase the vehicle for its MSRP value, minus mileage fees(if applicable) etc etc. That depends on your state as to what fees you will have to pay. In this case, as long as you owe less than the msrp and fees combined, you wouldnt have to pay anything out of pocket.



In my case, I chose a replacement vehicle, and here is how mine broke down.


Amount owed on 2017 - 36,000(I had some rollover and it was a recent purchase

MSRP of 2017 - 34,250

Replacement vehicle (2018) MSRP - $40,450


36,000 - 34,250 = 1750 difference (My state does not charge mileage fees ONLY if you are replacing, buyback in my state and you pay fees)


1750 + 40,450 = 42250 + tax on the difference between the two vehicles(489) = 42689


42,689 - 2000 down = 40,689 financed


In my case, because I owed more than the MSRP, I could have rolled the difference into the loan, but, I chose to (mostly) cover the difference.

The nice part is that when I bought my 2017, I traded a vehicle with a LOT of negative equity. I actually financed 39k on my base(shitty but worth it to me to go from a pickup to a "fun" car. So, with the 2018, my new loan payment is just a hair higher(a few dollars), but I upgraded massively(2017 base gt to a 2018 performance pack gt)


The way that ford does the numbers, and figures is very goofy, and It wont make sense. I was told that the NEW loan I took out, I had to get approved for enough to cover the MSRP of the OLD vehicle, PLUS the difference between the two vehicles(plus fees if applicable)

The check that the RAV department cuts to the dealer covers the new vehicle(minus the difference that you pay out of pocket)

Not sure why they do it that way, but thats the way they explained it to me.

Click to expand...

Financing $40K? You've guaranteed negative equity when you do that. Can't believe people actually do this and pay loads of interest.

bigriver said:

What does your letter say with regard to a Refund?

Click to expand...

Letter states the following:

A refund allows to to receive reimbursement of payments made to your lending institution including trade-in value allotted on any vehicle traded-in during original purchase, plus any cash down payment in exchange for the return of the vehicle.

Refund Determination:
1) Reimbursement of payments to the lending institution including the trade-in value allotted on any vehicle traded in during purchase, plus any cash down payment (not including rebates). The negative equity on a trade-in vehicle will be deducted from any down-payments. Ford will refund the tax, license and registration fees as indication on the original Buyer's Order. Any fees included in the loan/lease agreement are represented in the payments made to the lending institution refunded to you as listed above.

2)Mileage Usage: Any applicable mileage/usage charge will be included in your final participation amount, which will be conveyed to you in a final offer after all financial details have been determined. You will have the opportunity to review Ford's proposed usage calculation prior to final acceptance of Ford's refund offer.

Thanks for the info! That seems like a fair option. You would get back what you were out of pocket, less usage. I'm assuming they settle the remainng loan balance with the bank

The devil is in the details though. Seems like you get reimbursed for interest on loan payments as well. I also purchased lojack and paint protection so I think this is not covered in an exchange but could be wrong. .California lemon law requires a replacement to be substantially the same so maybe it is included. But under a refund, California lemon law excludes dealer installed items not from the manufacturer so lojack and paint protection are not refundable. The letter from Ford seems more favorable in this regard.

So if I get my down payment back plus loan payments minus usage, and Ford pays off the loan and accrued interest, I will be happy. The exchange process with Ford sounds too painful based on what others have gone through.

17LightningGT said:

As far as I know, it is MSRP in any case.

I paid 32 and some change for my 2017, they gave me 34,250 for it under buyback.

Click to expand...

What was the MSRP on your 2017? You paid $32k out the door or was that the selling price of the car before tax, title, registration fees? If Ford is indeed paying MSRP for buybacks most people would make money on the cars since they pay significantly less than MSRP for a new Mustang.

OP I would price out both options and see.

Refund - will the cash you get back, considering usage time, make you feel whole and allow you to get back into a similar vehicle or other options? For me, I want to get another Mustang but I'm weighing other options as well. My car is fully loaded but I may also get less options and go the aftermarket route. A refund give me flexibility. My buddy wants me to get a Saleen yellow label since I live within spitting distance from Saleen lol.

Replacement - Will you be happy with the upgrade and paying out additional money due to the usage deduction. Are you ready to bear down for the exchange process?

RTRFan said:

Hey guys... wanted to get some feedback as I am just going through the RAV team process right now.

After taking my car in 8 times with the AC Unit burning out in my 2016 EB PP, I called Ford Support and told them I was potentially seeking Lemon Law as a last resort. Almost immediately I was put on hold and then read the basic standard terms of what would happen next.

So I still ended up dropping my car off at the dealership to see if they could fix the issue and I was in a rental for a week.

A week later, I get a call from the RAV team stating they are processing my refund and need additional information. (Mind you, I hadn't even received a response from my original complaint at all). The next day I received the customer letter giving me the option for Replacement or Refund.

Although I havent received a detailed offer... what would be the best route?

Replacement Vehicle - Based on the letter it states that if I get same make, model, & trim they can upgrade me. Does that mean, for example, I can get a brand new '18 model with same everything and have the same amount of payments left on the car minus the usage fee?

Or should the Refund be the better route to go?

This is all new to me, but any insight is appreciated!

Click to expand...

If you have not stumbled on this thread yet, I posted a TON of insight and info regarding the Ford Buy Back process:
https://www.mustang6g.com/forums/showthread.php?t=99680

By no means is it 100% thorough in every aspect, BUT it probably has the most complete info to help anyone along.

17LightningGT said:

In my case, I chose a replacement vehicle, and here is how mine broke down.


Amount owed on 2017 - 36,000(I had some rollover and it was a recent purchase

MSRP of 2017 - 34,250

Replacement vehicle (2018) MSRP - $40,450


36,000 - 34,250 = 1750 difference (My state does not charge mileage fees ONLY if you are replacing, buyback in my state and you pay fees)


1750 + 40,450 = 42250 + tax on the difference between the two vehicles(489) = 42689


42,689 - 2000 down = 40,689 financed


In my case, because I owed more than the MSRP, I could have rolled the difference into the loan, but, I chose to (mostly) cover the difference.

The nice part is that when I bought my 2017, I traded a vehicle with a LOT of negative equity. I actually financed 39k on my base(shitty but worth it to me to go from a pickup to a "fun" car. So, with the 2018, my new loan payment is just a hair higher(a few dollars), but I upgraded massively(2017 base gt to a 2018 performance pack gt)


The way that ford does the numbers, and figures is very goofy, and It wont make sense. I was told that the NEW loan I took out, I had to get approved for enough to cover the MSRP of the OLD vehicle, PLUS the difference between the two vehicles(plus fees if applicable)

The check that the RAV department cuts to the dealer covers the new vehicle(minus the difference that you pay out of pocket)

Not sure why they do it that way, but thats the way they explained it to me.

Click to expand...

So in terms of taxes, you only need to pay the difference between the two cars assuming the replacement car has a higher MSRP? What about the dealership's processing/documentation fees? Did the dealer slap any of their bs processing/doc fees on the replacement car? Also, what about the registration fees?

Nanashii said:

What was the MSRP on your 2017? You paid $32k out the door or was that the selling price of the car before tax, title, registration fees? If Ford is indeed paying MSRP for buybacks most people would make money on the cars since they pay significantly less than MSRP for a new Mustang.

Click to expand...

But it seems to be a wash, since your being charged MSRP for the replacement vehicle.

ctandc72 said:

But it seems to be a wash, since your being charged MSRP for the replacement vehicle.

Click to expand...

Yeah, it's a wash if you are getting the car replaced. If you are doing a buyback though, I can't imagine that Ford will pay MSRP minus the mileage charge instead of the actual sales price of the car. In my case, I got about 16% off MSRP, so even after the mileage charge, I would be thousands of dollars better off with a buyback.