Lemon Law: What is it and How it Works


Nothing beats the feeling of driving a brand new car straight from the showroom. Ever heard of the saying driving it like it’s stolen? Well, now you get the picture! You have a lot of expectations in your new car. Perhaps you’re eager to embark on that road trip you’ve been planning for ages, or you can’t wait to show it off to your buddies at the gym. They say that money can’t buy happiness, but this is a saying left for another session because believe it or not, buying a brand new car is super exciting!

But it can be overly disappointing to find out days later that your brand new car has some flaws. Whether mechanical or electrical, it’s something that you never expected from a new car. When buying a new car, you expect the warranty to cushion you from such eventualities. But things don’t always turn out the way you planned. If the car problems will force you to take it back to the dealership, and after several fixes, the same problems persist, wait for it… you bought a lemon!

What Is Lemon Law?

Now, in most states, for a car to be considered a lemon, there has to be an objective and this has to be covered by the original warranty. For instance, if for the past five months you’ve been experiencing the same problem with the transmission or cruise control, this is a warranty-covered issue. But if the problem persists, you have yourself an ingredient for lemonade!

Different states have different lemon laws protecting consumers from faulty or defective products. In many states, these laws also cover for the repurchase of a leased vehicle, where there’s a laid down formula that outlines things that a dealer or manufacturer may deduct or compensate you for. More often than not, this formula requires a leased car to refund the buyer their down payment and any monthly payments, as well as other money such as sales tax, license, and registration fees. Some laws will only cover particular classes of vehicles. Nonetheless, lemon laws help to remedy problems or defects that may exceed the range of the manufacturer’s warranty. 

If the repairs cannot be completed within a set timeline as stipulated by the state laws, the manufacturer is obligated to buy back the defective car. But the problem is that not so many car dealership companies will want to give your money back. This is where you may be forced to take legal action against the manufacturer or dealership.

How Lemon Laws Work

Not many people know what lemon laws are or how they work. If you are having problems with getting your new car repaired under the guidelines in the warranty, then lemon laws will apply to you but only if your state recognizes them. So before you get started, you’ll need to first research your state’s lemon laws and determine whether your car is covered by the lemon laws in your state.

Making a Claim

If your new car has been giving you constant headaches, but you cannot get it sorted by the dealer, you may need to start building a case against them. The first thing you want to do is ensure that you have all the documents, including purchase documents and repair receipts. Remember, with lemon car claims, the sooner you make your claim, the easier it will get to be reimbursed. Here’s how to make your claim to the dealer:

1. Notify the Manufacturer Where You Bought the Vehicle From

Even though the vehicle was first repaired at the dealer’s service station, you still want to contact them directly and inform them of the persistent problem. By law, the dealer is obligated to have the problem fixed.

2. Allow the Dealer Time to Correct The Problem

It’s very important that before you take any steps to seek compensation under the lemon law, you allow the dealer more time to fix the problem. This could be three to four attempts of repair. These repairs should not last for more than 30 days.

3. Present a Written Notice to the Dealer

Once you’ve ascertained that indeed the car is a lemon, lemon laws require that you provide the dealer with a written notice by mail. Your notice should include the following:

  • A written statement stating that your car qualifies to be considered a lemon
  • The vehicle registration number
  • Details of the mechanical problems and a description of the repairs
  • The dates and times it took for each repair, including the costs

4. Refund Vs Replacement

If the dealer’s efforts to fix the problem as provided by lemon laws fail, the dealer can see it fit to reimburse you. Now, you should not feel compelled to accept the dealer’s choice of reimbursement. If you consider reimbursement, the dealer can reduce a certain percentage to account for the mileage and the time the car was out of the dealership premises. Each state has a formula for calculating all these things. And things can at times get out of hand, especially if both of you don’t come into an agreement. Not always will a dealer agree into refunding or replacing the car. Among the things that you may disagree on include the time limits set by the lemon laws, the dealer may insist that his repairs solved the problem, or you may disagree on how the refund amount is calculated.

If the matter seems to go out of hand and you cannot come into an agreement with the dealer, you have the option of consulting with an attorney. In such matters, especially if it’s your first time dealing with lemon cases, it’s important to have an attorney working on your behalf. This is because they have the experience and expertise needed to get you compensated. In addition to this, they’ll help to determine the strength of your case and will assist with the negotiations.

If the negotiations don’t come to fruition, you also have the option of going to court. But before that, the law requires that you first consider an arbitration process. If all else fails, that’s when you can sue the manufacturer and the dealer in a court of law. But you’ll also be dealing with the manufacturer’s attorneys, so make sure you brace yourself for a tough legal backing by working with an experienced attorney in these matters. Otherwise, a car is a huge investment and you deserve the best it can give you, especially after you’ve just purchased one.