Used Car Lemon Law
What is the Used Car Lemon Law?
A vehicle purchased or leased from a New York State dealer (one who sold or offered to sell three or more cars within the previous twelve-month period) for personal use with more than 18,000 miles but less than 100,000 miles is subject to Lemon Law coverage depending on the mileage at the time of purchase:
Miles At Purchase Duration of Warranty
18,000-36,000 90 days or 4,000 miles
36,001-79,999 60 days or 3,000 miles
80,000-100,000 30 days or 1,000 miles
What are the specific requirements to qualify for Used Car Lemon Law?
To qualify, all of the following must be true:
- You bought, leased, or received it after it already had 18,000 miles on it.
- It is at least two years old.
- You bought or leased the car from a New York dealer.
- The car had a purchase price or lease value of at least $1,500.
- The car had been driven less than 100,000 miles when you bought or leased it.
- You use the car for mostly personal purposes.
Your car’s manufacturer must first try a certain number of times to fix your car for any defect covered by the lemon-law warranty, free of charge. This is called a “duty to repair.”
You may be able to get a refund or replacement for your car if either of the following is true:
- The problem is still there after the dealer tries to fix it three or more times.
- You cannot use your car for a total of 15 days or more while the dealer is fixing it.
Are motorcycles or motor homes covered under the Used Car Lemon Law?
Motorcycles are covered under the Used Car Lemon Law and follow the same guidelines, requirements and timelines as would a used car.
Motor homes are NOT covered under the Used Car Lemon Law.
Can I still file a claim if my car was fixed?
If you have met all the other legal requirements, you may still be entitled to relief under the law, if either of the following is true:
- A defect remained even after the third repair attempt.
- Because of the defect, you were unable to drive the car for a total of 15 days or more, even if the defect was subsequently repaired.
For example: Your car had a defective transmission that could not be fixed after three repairs. The fourth repair fully fixed the problem. You are still considered to have made a reasonable number of repair attempts and you may be entitled to relief.
What happens if you win your case?
List of Services
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Repurchase / RefundList Item 1
If you win your case, you may be entitled to a full repurchase / refund. Your vehicle would be repurchased by the dealer and you would recieve a full refund.
The refund should include the full purchase price, which may or may not include the trade-in value.*
However, the dealer can deduct a reasonable amount for any damage beyond normal wear or use. The dealer can also adjust the amount if the car has been modified in any way that increases or decreases its market value. The Used Car Lemon Law does not account for additional expenses or charges** or sales tax.***
*The dealer does not have to include the value of the trade-in car in the refund. It can choose to either return any car you traded in at the time of the sale or lease of the used car (plus a refund of whatever money you paid)
OR
to include the wholesale value of the car, when you traded it in, in the refund. The wholesale value is determined by referring to the NADA Used Car Guide. However, the DMV is authorized to approve the use of an alternative guidebook. The dealer is allowed to adjust the listed value for mileage, improvements, or major defects that existed at the time of the trade-in.
**Other expenses or charges that are not included are finance charges, rental and storage charges, and loss of use or loss of time.
***Sales tax and attorneys fees (if applicable) are refunded separately. To obtain a refund of sales tax paid, tax refund form AU-11 should be completed and sent directy to the NYS Department of Taxation.
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Replacement
If you win your case, you may be entitled to a replacement vehicle. Your current vehicle would be replaced by the dealer and you would recieve a different vehicle of comparable make, model and mileage*.
*If the replacement vehicle has a higher selling price than the vehicle being replaced, you may be required to pay the difference, depending on financing options, original trade-in value and other factors.
Financing vs. Leasing a Used Car
List of Services
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FinancingList Item 1
The refund you will receive from the dealer is the same, whether the car was financed or paid for in cash at time of purchase. However, if the car is financed, the refund is divided between you and the lender (the bank or finance company). The lender will calculate how much you still owe and apply its part of the refund to that amount. The balance of the refund then goes to you*.
*There can be instances in which you may owe the dealer to comply with the award. This can happen if you had a large amount of negative equity on a prior trade-in or if the deductions for interest or sales tax exceed the amount of principal payments you have made to date.
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Leasing
If the car is leased, the refund due from the dealer is divided between you and the leasing company. Your refund is the total of your downpayments (including any trade-in allowance), plus the total of the monthly lease payments you have already made, minus interest charges and any other service fees.
For example: You leased a used car under a three-year lease, with a $1,500 downpayment, and pay a monthly lease payment of $300. Of the $300 monthly payment, $100 is allocated as interest charges. After you make 12 monthly payments, you are granted a refund under the lemon law:
Deposit $1,500
Monthly payments (12 x $300) $3,600
Interest (12 x $100) (-$1,200)
Total refund $3,900
The refund will be $3,900.
If the monthly payment includes other service fees, such as insurance or other costs that are paid for your benefit, these amounts will also be deducted from your refund.
The leasing company’s portion of the refund is the balance of the lease price, as that term is defined by the law.*
*Your lease agreement will be terminated if you win your case. However, you should continue to make any monthly lease payments as required under the lease agreement until the lease is paid off by the manufacturer to avoid late charges and/or negative credit reporting.
Ready to File or Still Have Questions?
To file a claim, click on the below file button to be redirected to the claim form. If you have any additional questions, you may reach out to NYSDRA's Lemon Law program manager directly at lemonlaw@nysdra.org. You may also complete the Contact Us form via the below button. When completing the form, please be sure to select Lemon Law as your area of interest. We also encourage you to review the below program FAQ which answers additional questions about the Lemon Law program and case management process.