How Do Lemon Laws Work?


How Do Lemon Laws Work?

A “Lemon” is a car that a buyer discovers is defective after they purchased it. If you find your car breaks down frequently or does not perform like the seller promised, then there is a good chance you have a Lemon on your hands. The warranty given to you upon delivery should cover problems with the car. However, if the problem cannot be fixed after multiple trips to the repair shop, or if the manufacturer does not honor the warranty, then there are steps you can take to protect your rights as a consumer.

These laws are nicknamed Lemon Laws and the government created them to protect and compensate you for products that fail to meet the expectations set by the manufacturer. Lemon Laws most commonly apply to used cars, but in some states they may apply to leased cars as well. Each state has a unique set of laws, but we can provide a general overview of how Lemon Laws work.

Do I have a Lemon?

The laws may vary by state, but a car can generally be considered a Lemon if it meets a few criteria:

  1. The car must have a defect that lingers after 3-4+ repair attempts. Each state will specify the number of repair attempts to consider a car a Lemon.
  2. The defect must be “substantial” and covered by warranty. The attempts to remedy the defect must happen within the specified warranty time.
  3. The car must be in the shop or out of service for a specific number of days in its first to second year. Typically 25-30 days out of service will consider the car a Lemon.

For example, a customer buys a car and discovers that his brakes are defective. The customer takes it to a mechanic. The mechanic then has possession of the car for over 30 days, maybe because it is a complex job or must wait for ordered parts to arrive, the customer’s car is a Lemon and they can be compensated.

Criteria 1 and 2 are the most common, and many states also apply 3, but not every state.

What Constitutes a “Substantial Defect?”

To be classified as a “substantial defect” the problem cannot have been caused by use of the car after purchase. The defect must impair the use, value, or safety of the car. This means that safety defects such as brake problems and steering issues are covered, but aesthetic paint chipping may not be. The defect also must occur within a certain period, typically within 1 or 2 years or 12,000-24,000 miles after purchase.

The difference between “substantial defect” and other, more minor defects is a gray area among many states. Always check your state’s definition of a Lemon to see if any of your defects can be covered. Do note that the defect cannot be a result of abuse of the car or misuse.

How Many More Times?

The criteria for reasonable number of repairs is a vital component of Lemon law. Once the manufacturer is given notice of the defect they have a certain number of attempts to repair the problem. If a permanent solution to the problem cannot be found within this number then the car is considered a Lemon. The number of attempts will vary by state and type of defect. A major safety defect may only get one reasonable attempt, while paint defects may get a couple.

Making Lemonade

If it is deemed that your car meets the Lemon law requirements in your state then you have the right to get a replacement car or refund from the manufacturer. Note that it will not come from the dealer or seller you bought it from, but from the manufacturer. Before you are eligible for a refund you must first notify the manufacturer. They may try to repair it again or offer a settlement. If the settlement is unsatisfactory then you can go to arbitration. If arbitration does not succeed then the case can go to court.

As stated earlier, the manufacturer typically has about four attempts to remedy the defect within the warranty before a car can be considered a Lemon. You will need to keep a record of each visit to the mechanic with dates to compare to the date of purchase. The more evidence brought to the manufacturer, the greater your chance for receiving a refund or replacement car. Invoices showing the car was repaired multiple times in its first year will go a long way to proving you bought a Lemon.