Quick answer
Yes, for many used cars. Starting October 1, 2026, the CARS Act requires California dealers to give buyers and lessees of used vehicles priced at $50,000 or less a three-day right to cancel. You can't have driven it more than 400 miles, and the dealer can charge a capped restocking fee. The dealer must refund you within 48 hours.
Key takeaways
- Applies to used vehicles sold or leased at retail for $50,000 or less. New cars aren't covered.
- You have three days to cancel for any reason.
- The right ends if the car has been driven more than 400 miles since you signed.
- Restocking fee: 1.5% of the sale price, at least $200 and no more than $600, plus a capped per-mile charge if you drove more than 250 miles.
- The dealer must cancel the contract and refund you within 48 hours, and return your trade-in if it hasn't been sold.
What changed on October 1, 2026
California's Combating Auto Retail Scams (CARS) Act, passed as SB 766 and signed October 6, 2025, took effect October 1, 2026. It replaced the old optional two-day "contract cancellation option" that dealers had to offer on used cars under $40,000. Instead, every qualifying used car sale now comes with a three-day right to cancel, and dealers must tell you about it.
Who qualifies
- Used vehicles sold or leased at retail for $50,000 or less.
- The vehicle has been driven 400 miles or less since you signed.
- Not covered: new vehicles, sales to commercial buyers who purchase five or more vehicles a year from the dealer for business, and vehicles with a gross vehicle weight rating of 10,000 pounds or more.
What it costs to cancel
The dealer can charge a restocking fee of 1.5% of the sale price, with a $200 minimum and a $600 maximum. If the dealer charged you for shipping the car, it may keep its actual shipping cost instead, up to that same cap. If you drove more than 250 miles, the dealer can add a per-mile charge for the miles above 250, which is capped.
The restocking fee comes out of your refund. You must return the car in the same condition, apart from normal wear and tear.
What the dealer must do
- Cancel the contract and give you a full refund, minus allowed deductions, within 48 hours. (If you paid by check or another method that doesn't transfer funds immediately, the dealer may briefly delay the refund until the payment clears.)
- Return your trade-in and keys if it hasn't sold the trade-in. If it has, it must pay you for it.
- Not refuse the cancellation, claim damage beyond normal wear without a reasonable basis, or claim the person who can process your refund isn't available.
What to do next
- Check the price and the mileage since you signed. You need $50,000 or less and 400 miles or less.
- Look for the cancellation notice the dealer must give you with your contract.
- Return the car in person during business hours, with all keys and paperwork, and get a signed receipt.
- Write down when you returned it. The 48-hour refund clock starts when you exercise the right.
- If the dealer refuses, stalls the refund, or invents damage, request a free case review.
Frequently asked questions
Sources
- SB 766, California Combating Auto Retail Scams (CARS) Act, Civil Code § 1784.20 and following
- California Attorney General: file a consumer complaint
This website provides general information, not legal advice. Laws change and every situation is different. Talk to a licensed attorney in your state about your specific facts.
More on this topic: California car buyer rights & dealer fraud overview