Car purchase rescission in Germany: what you get back after withdrawal — and what the dealer may deduct

What did the Regional Court of Cologne decide on unwinding the purchase?

The Regional Court of Cologne (Landgericht Köln) ordered the dealer to pay €23,445.87 plus interest of five percentage points above the base rate from 1 August 2025 — concurrently against re-transfer of ownership of the vehicle (judgment of 26 May 2026, 18 O 329/25). On top of that come €1,457.81 in pre-litigation lawyer’s fees, and the court declared that the dealer is in default of acceptance (Annahmeverzug) with taking the car back. Whether the judgment has become final was not known at the time of writing.

In May 2025 the buyer, acting as a consumer, had purchased a roughly seven-year-old car with 122,590 km on the clock for €24,950. The online listing described the vehicle as accident-free („unfallfrei“), on enquiry the dealer spoke of at most a „minor accident“, and the invoice carried a note that the car was not sold as accident-free. A comprehensive-insurance assessment from 2022 later revealed a rollover with a total economic loss: repair costs of €43,770.15 net against a replacement value of €28,300.

Why the note on the invoice does not curtail the buyer’s rights, and why an accident-damaged car remains defective even after repair, we have explained in detail in our article on accident-damaged cars from Germany. This article deals with the second half of the judgment: the settlement after withdrawal, which in many cases causes more dispute than the defect itself.

When is withdrawal from a car purchase effective — and is a deadline for repair required?

Withdrawal requires a material defect at the time the risk passes (section 434 of the German Civil Code, BGB) and is exercised by declaration to the seller (section 349 BGB) — in the Cologne case by a lawyer’s letter of 17 July 2025. As a rule the buyer must first set the seller a reasonable deadline for cure (section 323 (1) BGB). With an accident-damaged car that deadline falls away, because no form of cure could remove the defect.

Repair is ruled out because the car’s status as an accident vehicle survives any bodywork. The Federal Court of Justice (BGH) put it this way back in 2007:

„Einer vorangehenden Fristsetzung zur Nacherfüllung durch Nachbesserung der nicht fachgerecht ausgeführten Reparaturarbeiten bedurfte es nicht, weil der Mangel nicht behebbar ist (§ 326 Abs. 5 BGB). Durch Nachbesserung läßt sich der Charakter des Fahrzeugs als Unfallwagen nicht korrigieren.“

„There was no need to set a prior deadline for cure by remedying the unprofessionally executed repair work, because the defect cannot be remedied (section 326 (5) BGB). Repair cannot correct the vehicle’s character as an accident car.“

BGH, judgment of 10 October 2007 – VIII ZR 330/06, NJW 2008, 53, para. 23 — our translation

Replacement delivery is likewise generally unavailable for a used car. According to the Federal Court of Justice, when a used car is bought it is „in der Regel nahe“ (as a rule obvious) to deny replacement delivery „wenn dem Kaufentschluss eine persönliche Besichtigung des Fahrzeugs vorangegangen ist“ (if the decision to buy was preceded by a personal inspection of the vehicle) (BGH, judgment of 7 June 2006 – VIII ZR 209/05, BGHZ 168, 64, headnote b). The Cologne court adopted both lines of reasoning: neither a repair nor a replacement vehicle would have freed the buyer from the car’s accident history.

For consumers the legislature has relaxed the deadline requirement further. Under section 475d (1) no. 3 BGB no deadline is needed where the defect is so serious that immediate withdrawal is justified — a concealed total economic loss falls into that category. And such a defect is certainly not insignificant within the meaning of section 323 (5) sentence 2 BGB, which would exclude withdrawal. The Federal Court of Justice draws the line for tolerable minor damage (Bagatellschaden) narrowly: for passenger cars it recognises as minor damage „nur ganz geringfügige, äußere (Lack-)Schäden“ (only very slight external paint damage), „nicht dagegen andere (Blech-)Schäden, auch wenn sie keine weitergehenden Folgen hatten und der Reparaturaufwand nur gering war“ (but not other bodywork damage, even if it had no further consequences and the repair effort was small) (BGH, judgment of 10 October 2007 – VIII ZR 330/06, NJW 2008, 53, para. 20).

What does the buyer get back — and from when does interest run?

After withdrawal the parties must return what they received (section 346 (1) BGB): the seller refunds the full purchase price, the buyer hands back the vehicle and re-transfers ownership. Both obligations are performed concurrently, step by step (Zug um Zug, section 348 BGB). In the Cologne case the price of €24,950 was made up of a deposit of €1,000, a later transfer of €20,950 and the credited old car — the court took the full amount as the basis of the refund.

Interest runs from default. The dealer is in default if he fails to pay after a demand made once the debt is due (section 286 (1) sentence 1 BGB) and then owes default interest of five percentage points above the base rate (section 288 (1) BGB). The Cologne court awarded interest from 1 August 2025, the day after the payment deadline set in the withdrawal letter expired. A withdrawal letter with a clear payment date is therefore worth real money.

For contracts concluded since 1 January 2022, section 475 (7) BGB additionally provides that in a consumer sale the trader bears the costs of returning the goods. The buyer therefore does not have to hire a transporter at his own expense or drive the car halfway across Germany to the dealer. The details of returning the vehicle are set out in the section on default of acceptance.

How is compensation for use (Nutzungsersatz) calculated for the kilometres driven?

The buyer must hand over the benefits derived from the car (section 346 (1) BGB), which for a vehicle means compensating the value of its use (section 346 (2) sentence 1 no. 1 BGB). The courts calculate on a straight-line basis: gross purchase price multiplied by the kilometres driven, divided by the remaining mileage expected at handover. The Cologne court set out the calculation as follows:

„24.950,00 € ./. 127.410 km (Laufleistung bei einer Gesamtlaufleistung von 250.000 km) x 7.681 km (gefahrene Kilometer seit Übergabe an die Klägerin) = 1.504,13 €.“

„€24,950.00 ÷ 127,410 km (mileage on the basis of a total service life of 250,000 km) × 7,681 km (kilometres driven since handover to the claimant) = €1,504.13.“

LG Köln, judgment of 26 May 2026 – 18 O 329/25, BeckRS 2026, 14562, para. 49 — our translation

The 127,410 km are the difference between the assumed total service life of 250,000 km and the odometer reading at handover (122,590 km). The 7,681 km are the reading at the hearing (130,271 km) minus the reading at handover. Of the €24,950 purchase price, €23,445.87 remained after the deduction.

The total service life is an estimate, and it decides hundreds of euros. The Higher Regional Court of Cologne (Oberlandesgericht Köln) consistently applies 300,000 km (OLG Köln, judgment of 9 April 2025 – 11 U 20/24, NJW-RR 2025, 821). On that basis the deduction in the Cologne case would have been only €1,080.22, around €424 less. Anyone negotiating an unwinding should therefore not accept the total service life unquestioningly but relate it to the vehicle type, engine and prior mileage.

The calculation is based on the gross purchase price, and no value-added tax is added again to the resulting figure (BGH, judgment of 9 April 2014 – VIII ZR 215/13, NJW 2014, 2435). That a consumer owes compensation for use at all upon withdrawal is compatible with EU law (BGH, judgment of 16 September 2009 – VIII ZR 243/08, BGHZ 182, 241). Replacement delivery is different: there section 475 (3) sentence 1 BGB excludes any surrender of benefits.

Every further kilometre reduces the refund. The Cologne buyer parked the car from September 2025 — a wise decision, because the deduction is calculated on the odometer reading at the last oral hearing, not the reading at withdrawal. Anyone who has to keep using the car should document the mileage and adjust the claim in time: the Cologne court treated the reduction of the claim by the increased compensation for use as a partial withdrawal of the action under section 269 of the German Code of Civil Procedure (ZPO), yet imposed the full costs of the proceedings on the dealer (section 92 (2) ZPO).

What happens to the old car given in part exchange?

Whether the old car is drawn into the unwinding depends on whether the purchase contract and the part exchange form a single legal transaction. In the Cologne case the court said no: the buyer had sold her previous car to the dealer under a separate contract for €3,000, and the two contracts stood independently side by side. The consequence favoured the buyer — she recovered the full price of €24,950, and the old car stayed with the dealer.

„Vorliegend ergibt sich schon aus dem Wortlaut der Verträge, dass diese als unabhängig voneinander bestehende Verträge angesehen werden sollten. Keiner dieser Verträge nimmt auf den jeweils anderen Vertrag Bezug, insbesondere ist in keinem von einer ‚Verrechnung‘ o.ä. die Rede.“

„In the present case it already follows from the wording of the contracts that they were to be regarded as contracts existing independently of one another. Neither contract refers to the other, and in particular neither mentions any ‘set-off’ or the like.“

LG Köln, judgment of 26 May 2026 – 18 O 329/25, BeckRS 2026, 14562, para. 45 — our translation

The court relied on three indications: the contract for the old car provided for cash payment on handover, the balance for the purchased vehicle was paid separately by bank transfer, and the dealer traded in used cars anyway, so he did not take the old car merely to make the sale possible. That the parties later netted the two prices for practical reasons changed nothing.

The classic new-car purchase with a trade-in is different. There, according to the Federal Court of Justice, the purchase contract and the part exchange regularly form an economic and legal unit, because the dealer only accepts the old car in order to sell the new one (BGH, judgment of 20 February 2008 – VIII ZR 334/06, BGHZ 175, 286). On unwinding, the buyer can then demand the return of his old car, not payment of the credited trade-in value. If the dealer has already resold the old car, compensation in money takes the place of its return (section 346 (2) sentence 1 no. 2 BGB) — which the Cologne court, in the alternative, would have assessed at the agreed €3,000.

In practice the paperwork decides. Anyone giving up an old car should check whether the contracts refer to each other, whether a set-off was agreed in writing and how the payment flows are documented. We have discussed the same question on the example of a dealer’s form with tick boxes in our article on used car dealer warranty in Germany.

Does the buyer have to return the car — and what does the dealer’s default of acceptance achieve?

The buyer must offer to return the car, not deliver it to the dealer at his own expense. Under section 475 (7) BGB the trader bears the costs of the return. If the dealer does not take the vehicle back, he falls into default of acceptance (section 293 BGB), and for that a verbal offer suffices once the dealer has declared that he will not accept performance (section 295 sentence 1 BGB).

In the Cologne proceedings the offer made at the oral hearing was enough for the court:

„Da die Beklagte nur Zug um Zug zur Leistung verpflichtet ist, ist sie diesbezüglich im Annahmeverzug, da sie die ihrerseits obliegende Leistung durch Stellung des Klageabweisungsantrags verweigert hat. Aus diesem Grunde genügt auch das wörtliche Angebot.“

„Since the defendant is obliged to perform only concurrently, she is in default of acceptance in this respect, because by moving for dismissal of the action she refused the performance incumbent on her. For that reason a verbal offer also suffices.“

LG Köln, judgment of 26 May 2026 – 18 O 329/25, BeckRS 2026, 14562, para. 58 — our translation

An application for a declaration of default of acceptance belongs in every unwinding claim. It has two effects. First, during the default of acceptance the buyer is liable only for intent and gross negligence (section 300 (1) BGB) and can claim the additional expenses of storing and preserving the vehicle (section 304 BGB). Second, the declaration eases enforcement: where a judgment orders payment concurrently against return, the bailiff may only start enforcement once the counter-performance has been offered or the default of acceptance has been proven by documents (section 756 (1), section 765 ZPO). The declaratory judgment is that proof.

Until the return, the vehicle remains in the buyer’s custody. He must not sell it — otherwise he owes compensation in money instead of the return (section 346 (2) sentence 1 no. 2 BGB). Sensible steps are a secure parking space, a photograph of the odometer and a written request for collection with a proposed date, so that the default of acceptance is documented outside the proceedings as well.

Who pays the pre-litigation lawyer’s fees?

The dealer — if he was already in default when the lawyer was instructed. The costs of pursuing the claim are then damage caused by default (section 280 (1) and (2), section 286 BGB). In the Cologne case the deadline in the withdrawal letter had expired when the second lawyer’s letter of 4 August 2025 demanded payment once more. The court regarded that letter as a measure aimed at an out-of-court settlement and awarded €1,457.81.

A special point concerns legal expenses insurance (Rechtsschutzversicherung). To the extent the insurer has paid the lawyer’s fees, the claim for reimbursement passes to the insurer (section 86 (1) of the German Insurance Contract Act, VVG). With her insurer’s authorisation the Cologne buyer was allowed to sue for the transferred amount in her own name, but only to demand payment to the insurer. Her excess of €300 was awarded to her personally, both amounts bearing interest from service of the claim (section 291 BGB).

Do you want to unwind a car purchase in Germany without leaving the arithmetic to the dealer? We calculate the compensation for use and the refund, draft the withdrawal letter with a deadline and enforce the judgment for concurrent performance together with the declaration of default of acceptance. Details on our page on defective cars from Germany. For the transport costs of a cure, read our article on engine failure shortly after purchase.

Frequently asked questions

Do I have to pay compensation for use even though the dealer sold me an accident-damaged car?
Yes. On withdrawal the benefits derived must be surrendered (section 346 (1) BGB), and the Federal Court of Justice considers this compatible with EU law in consumer sales as well (BGH, judgment of 16 September 2009 – VIII ZR 243/08). In the Cologne case it was €1,504.13 for 7,681 km. Replacement delivery is different: there the consumer owes no compensation for use (section 475 (3) sentence 1 BGB).

How do I calculate the compensation for use myself?
Gross purchase price multiplied by the kilometres driven, divided by the remaining mileage (expected total service life minus the odometer reading at handover). Example from the Cologne judgment: €24,950 × 7,681 km ÷ 127,410 km = €1,504.13. With a total service life of 300,000 km, as applied by the Higher Regional Court of Cologne, it would be €1,080.22.

May I keep driving the car until it is returned?
Legally yes, economically it is unwise: every kilometre increases the deduction, because the odometer reading at the last oral hearing counts. You must not sell the vehicle, otherwise you owe compensation in money instead of its return (section 346 (2) sentence 1 no. 2 BGB).

I gave my old car in part exchange. Do I get it back?
That depends on the contracts. A separate contract without cross-reference, as in the Cologne case: the old car stays with the dealer and you recover the full purchase price. A single transaction, as is typical for a new-car purchase (BGH, judgment of 20 February 2008 – VIII ZR 334/06): return of the old car, and after a resale compensation in money (section 346 (2) sentence 1 no. 2 BGB).

The dealer will not collect the car. What can I do?
Offer the return in writing and propose a date. Once the dealer refuses to take the car back, this verbal offer suffices (section 295 BGB): from then on you are liable only for intent and gross negligence (section 300 (1) BGB), and parking costs are recoverable additional expenses (section 304 BGB). In court, apply for a declaration of default of acceptance — it eases enforcement (section 756 (1) ZPO). The costs of the return are borne by the trader in any event (section 475 (7) BGB).

I live abroad and bought the car in Germany. Can you handle the case?
Yes. We handle unwindings in German, Polish and English, correspondence with the dealer and the court is conducted electronically, and you can send us your documents online.

Basis: LG Köln, judgment of 26 May 2026 – 18 O 329/25 (BeckRS 2026, 14562), finality not known at the time of writing. This article is for information only and does not replace advice on your individual case.

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