Saturday, June 22, 2013

Is it Possible to Get Out of Car Lease if the Car is a Lemon?

You can't know everything about a car when you buy it. Unfortunately, a car that looked good on the lot can start falling apart on the drive home. There is legal protection for people who end up with lemons. In many states, the protection extends to both lessees and buyers.

Definition

    Your car must meet your state's definition of a lemon before you can take any legal action. Generally, a car must have a defect that affects its value or safety and a reasonable number of attempts must have been made to repair the vehicle. The defect also must happen within a certain mileage or time limit, typically 12,000 miles or one year. In some states, a car must meet two criteria -- a set number of failed repair attempts for the same defect and a set time period out of service. In other states, the car may meet either of those limits. A few states, such as Maryland and Hawaii, will designate the car as a lemon with just one failed repair attempt if the defect is something that can be life-threatening, such as a problem with the brakes or steering system.

Laws

    The laws governing the conditions under which consumers may petition for reimbursement of the lease price of a car are under the jurisdiction of individual states. While many states' lemon laws cover leases, there may be special provisions. It's important to understand your rights before signing a lease agreement.

Compensation

    Lemon laws allow consumers who can prove they have a lemon to gain reimbursement from the manufacturer. Those who have purchased cars can choose between a refund or a replacement. Lessees sometimes have the same choice, but in many cases the holder of a leased lemon is only entitled to a refund. The refund includes all payments and fees that you've made minus some usage cost that is based on the mileage of the vehicle.

Considerations

    If you think you have leased a lemon, seek legal representation. There are lawyers who specialize consumer laws. Look for a lawyer who works on contingency. This means that you do not have to pay an upfront fee, typically paying only if the lawyer wins your case. You also need to keep good records, documenting the mechanical problems and the attempts to repair.

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