Matthew Oliver
When you make a purchase, especially as one as sizeable as a vehicle, you want to know that you made a good financial decision. And purchasing a car is one of the largest transactions you’ll ever make. But here’s the thing: things go wrong. Cars break down. And all those inner workings? How can you rest assured that the car you purchased will last as long as it is supposed to?
Well, that’s where the lemon law comes into play. Lemon Laws are consumer protection regulations designed to help buyers who have unknowingly purchased defective vehicles or other goods. These laws are an important safeguard for upholding fairness in the marketplace and protecting consumers from faulty purchases.
In this article, the team at RateWorks will provide a bit further insight into what the lemon law is and how it is designed to work for you.
What is a lemon law, and how does it work?
When you think of a lemon, whether you like lemons or not, what comes to mind? For most people, it’s the tart and puckery flavor that stands out. A little bit of tartness can be tolerable—maybe even refreshing—but too much, and it quickly becomes overwhelming and unpleasant. This idea translates to why defective products, particularly vehicles, are sometimes referred to as “lemons.” Like an overly sour lemon, a faulty car or product brings frustration rather than satisfaction.
Lemon Laws were created to address this frustration. These statutes provide legal remedies for consumers who unknowingly purchase defective vehicles or products that fail to meet expected standards of quality and performance. The laws help protect buyers by holding manufacturers accountable for faulty goods and providing options for repair, replacement, or refund.
While Lemon Laws most commonly apply to new vehicles, the specifics can vary by jurisdiction. In some cases, they may also extend to other consumer goods, such as appliances, electronics, or even used cars, depending on the state or country. Understanding the scope of these laws can help buyers feel more informed and prepared if they ever find themselves dealing with a problematic purchase.
Federal lemon law: Magnuson-Moss Warranty Act
The Magnuson-Moss Warranty Act, passed in 1975, is like a safety net for consumers dealing with warranty issues. It’s there to make sure manufacturers stick to their word and follow through on the promises they make about their products.
This law applies to items costing more than $25 and is designed to prevent companies from drafting unclear or unfair warranties. If a manufacturer doesn’t honor their warranty, this act allows buyers to take legal action. What makes it even more helpful is that it allows for attorney’s fees to be covered, making it easier for people to pursue their case without worrying about the cost.
In short, the Magnuson-Moss Act makes warranties more meaningful and allows consumers to hold manufacturers accountable when things don’t go as promised.
State lemon laws
Whereas the Magnuson-Moss Warranty Act was created at the federal level, each state and the District of Columbia also have their own unique lemon laws. These laws add another layer of protection, but their specifics vary quite a bit. So, you may have a different experience with the lemon law in your state than someone else in a neighboring state.
For example, Arizona’s lemon law applies to new vehicles and allows the manufacturer four repair attempts or 30 cumulative days in the shop within the first two years or 24,000 miles, whichever comes first. Ohio also focuses on new vehicles but gives the manufacturer a slightly longer period—one year or 18,000 miles—and limits repair attempts to three for the same issue. In Wyoming, the law covers the first year or the first 12,000 miles, and manufacturers are allowed three attempts to resolve the problem before the consumer can seek further action.
These differences extend to how arbitration processes work and what is required to qualify for protection, so understanding your state’s specific lemon law is important when dealing with a defective vehicle.
Common Provisions
Lemon Laws generally outline specific conditions that must be met for a vehicle to qualify as a “lemon.” While the details vary by state, many laws share similar provisions:
- Substantial Defects: The vehicle must have a significant problem that impacts its safety, value, or usability. Minor issues or wear-and-tear items usually don’t qualify.
- Repair Attempts: Manufacturers are typically given a reasonable number of chances—often three or four—to fix the issue before the vehicle is deemed a lemon.
- Time or Mileage Limits: Most laws apply to issues that occur within a specific time period or mileage, such as the first year or 12,000 miles.
- Cumulative Downtime: If a vehicle spends a certain number of days in the repair shop (e.g., 30 days), it may qualify as a lemon.
Some states extend these protections to used vehicles, but coverage varies widely. Be sure to check on the specifics of your state before making a vehicle purchase.
Why lemon laws are important
Buying a car is expensive. In fact, the average used car price in the U.S. is around $25,540. And, the average used car price? You’re looking at around $47,010. When you spend that kind of money, you want peace of mind, knowing that you’ll be protected if things go sideways in a big way.
Lemon Laws help protect consumers from financial loss and potential safety risks that come with defective vehicles or products. By holding manufacturers accountable, these laws push companies to maintain high-quality standards and avoid costly legal disputes or damage to their reputations.
Ready to learn more about making smarter car-buying decisions? Follow the RateWorks blog for helpful insights and tips to guide your next purchase!
