Get compensation for a used car through the Lemon Law
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Office of Consumer Affairs and Business Regulation
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Under the Massachusetts Lemon Law, you may be eligible for different types of compensation for serious defects that impair the use or safety of cars purchased from a licensed Massachusetts dealer that are used for personal or family purposes. A dealer is someone who sells more than 4 cars in a 12-month period.
Compensation options include costs of repairs, refunds, vehicle buyback, or the option to cancel a sale. There are steps and eligibility requirements for each of these options. The law doesn’t cover all vehicles or all defects, and not all problems will qualify your vehicle to be bought back.
You may pursue compensation under the Lemon Law with notices and correspondences directly to the dealer. Once you’ve tried all these options, Lemon law arbitration through the Office of Consumer Affairs and Business Regulation may be available to you.
Before you start
Dealers selling used vehicles must:
- Provide you with a written warranty against defects that impair the vehicle’s use or safety
- Give you a signed, dated copy of the warranty when you purchase the vehicle
- Repair any defect that impairs the vehicle’s use or safety
This warranty cannot be waived. If the dealer does not give you a warranty or gives you one that is incomplete or inaccurate, you are still entitled to warranty repairs. Your warranty will not begin to expire until the dealer gives you a complete and accurate copy of your warranty.
How to get Get compensation for a used car through the Lemon Law
If your car is eligible under the Lemon Law, there are a few ways you may be compensated.
Cancel the Sale
You may cancel the sale of your car and bring it back to the dealer if
- It was purchased, not leased.
- It fails to pass inspection within 7 days from the date you bought it.
- The estimated costs of defects or repairs exceed 10% of the purchase price. Have a written estimate from the licensed inspection station that failed your car.
- You complete the proper steps detailed under the Failed Inspection Lemon Law within 14 days of the date of sale.
Mandatory Repairs and Warranty Extension
You’re eligible for mandatory repairs if the defects happen during the warranty period. The dealer must repair all safety and use defects unless they offer to buy back the car. The dealer is allowed to charge you a one-time repair fee of $100, but only if the amount is written on your copy of the warranty.
Note: If the dealer offers to buy back the car for the full purchase price and you reject the offer, the dealer may refuse repairs.
There are some instances that may allow for an extension of your warranty period:
- If the dealer needs to order parts during a repair attempt, the days out-of-service while waiting for parts do not count toward the 11 business day requirement of the law. Your warranty will extend by one day for each day you are waiting for the parts. However, a maximum of 21 calendar days during the warranty period will not be counted toward the 11 business day limit if parts are ordered. All business days after the 21st day will count.
- If the dealer does not give you a warranty or gives you one that is incomplete or inaccurate, your warranty will not begin to expire until the dealer gives you a complete, accurate copy of the warranty.
- Any repair performed on a covered defect during the warranty period carries its own 30-day warranty. This warranty begins the day the repair is completed and can continue after the original warranty on the car as a whole expires.
- If a defect occurs within the warranty period and you take it to get repaired within 5 business after the warranty expires, the warranty is extended for 30 days from the date the repair is completed for that defect only.
- If a defect occurs within the warranty period and you cannot reasonably bring the car to get repaired within 5 business days after the warranty expires, your warranty is extended by 1 day for each day until the car can be reasonably returned.
The dealer has a total of 11 business days* (consecutive or non-consecutive) or 3 repair attempts to fix the defect. If the defect remains after 11 business days or 3 repair attempts, you have the right to a refund.
*A business day in this instance is defined as Monday through Friday, except for state or federal holidays. When counting the number of business days your car has been out of service, any part of a business day counts as a whole day. If the dealer refused to accept the vehicle in person or within 3 business days of a telephone or written request for repair, then the car is considered “out of service” beginning that day. This, and any following business days waiting for the car to be repaired, will count toward the 11 business days out of service requirement for a refund.
Dealer Buy Back and Refund
The dealer has a right to offer to buy back the car instead of making repairs.
- You are responsible for helping to determine the refund by giving the dealer copies of your receipts and other documents for each cost to be reimbursed.
- The dealer must make the offer to buy back your car in writing.
- You have at least 5 business days from when you receive the dealer’s offer to decide whether to accept the offer.
- If the dealer offers you a full refund and you refuse to accept it, you will not be entitled to any further warranty repairs.
To calculate the amount you are entitled to receive under the law, add:
- The purchase price, including the amount for your trade-in
- Finance charges
- Registration fees
- The pro-rata cost of payments toward motor vehicle damage, collision, and comprehensive insurance
- The non-refundable portion of payments made for credit life and credit accident insurance on your vehicle loan
- The non-refundable portion of payments made for any extended warranties and service contracts
- Unreimbursed costs of towing up to 30 miles
- Up to $15 a day for alternate forms of transportation, starting on the third day the car has been out of service for repair
- Payments made toward the $100 repair deductible
- Any other costs directly related to the defect
You’ll also need to subtract:
- A use allowance of 15 cents per mile for every mile driven from the time of delivery to the date the refund is given
- The amount, if any, of over allowance on a trade-in vehicle. An "over allowance" or "discount" is the difference between the trade-in amount and the actual cash value of the trade-in vehicle. The over allowance will be deducted from your refund only if the over allowance is separately listed on your copy of the motor vehicle purchase contract, bill of sale, or other documents given to you at the time of the sale.
If you traded in a vehicle and the dealer still has it, they have the option of returning it to you rather than refunding the trade-in amount. If the dealer has the trade-in and wants to keep it, they must refund you the amount of the trade-in.
If the dealer is going to buy back your car, you will need to work together to meet and exchange the car and its title for a refund. You must transfer the title back to the dealer. Contact the Registry of Motor Vehicles and explain that you are retuning your vehicle under the Lemon Law for used cars (or MGL Chapter 90 Section 7N ¼) and request that a certificate of title is issued to you as soon as possible.
If your car is financed, you will need to get a lien release from the finance company. The lien release will enable the Registry to issue a title in your name. You will also need to work with the dealer and the finance company to arrange for the dealer to pay the finance company the portion of the loan that is still owed.
Your refund will not include lawyer fees, lost wages, excise tax, sales tax, or other costs that are not directly related to the defect. You can apply at your city or town hall for an abatement of excise tax. Contact the Department of Revenue to request information regarding an abatement for the sales tax.
The dealer is not required to refund the sales tax.
More info for Get compensation for a used car through the Lemon Law
If you purchased a used car through a private party sale, see private party sales. A private party seller is someone who sells less than 4 cars in a 12-month period.
If the manufacturer will not refund your money or replace the vehicle, or you do not qualify under the Lemon Laws, you have other options. You may seek mediation or file suit in court.
This allows both parties to reach a mutually agreeable resolution with the help of a facilitator. Mediation is voluntary, requiring both parties' consent. You may also apply for mediation through your local consumer group.
You have the right to proceed to court if you have met the Lemon Law's requirements and the manufacturer refuses to refund your money or replace your vehicle with one that is acceptable to you, or if you are not satisfied with your arbitration decision. If you are considering court action, you should consult an attorney. You or your attorney must begin by sending the manufacturer a 30-day demand letter.