Used Car Lemon Law Frequently Asked Questions
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Find Out if You Have a Claim
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What is the New Jersey Used Car Lemon Law?
A "lemon" vehicle is one that exhibits a substantial problem or problems following repair attempts made to it. New Jersey’s lawmakers decided that, when buying certain used cars, the public should be protected from lemon vehicles by having a right to recover from the selling dealers a refund of the vehicle’s purchase price, less a deduction for sales taxes, title and registration fees or other similar government charges, a reasonable allowance for any excessive wear and tear and a deduction for personal use. Under New Jersey’s Used Car Lemon Law, used car dealers must provide buyers of certain used vehicles purchased after July 3, 1996 with warranties. In addition, the New Jersey Used Car Lemon Law prohibits used car dealers from engaging in certain types of conduct regardless of whether the purchaser is entitled to a warranty.
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Who must comply with the New Jersey Used Car Lemon Law?
- A person selling or offering for sale a used motor vehicle after selling or offering for sale 3 or more used motor vehicles in the previous 12 month period.
- A lessor who is a dealer and who sells or offers for sale a used passenger motor vehicle, subject to a motor vehicle lease agreement which was in effect for more than 90 days, to a consumer who is not the lessee, or a family member or employee of the lessee upon the termination of the lease agreement.
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When is the New Jersey Used Car Lemon Law warranty excluded?
- When you purchased the vehicle, you did so for the purpose of resale.
- The vehicle was not the subject of a “sale” (the transfer of title of a used vehicle from the owner-seller to the purchaser-consumer) but instead, the owner-seller obtained title to or was granted the right to sell a used vehicle by operation of law.
- The vehicle was sold by a public entity or unit of the government.
- The vehicle is not they type normally used for personal, family or household purposes.
- The vehicle is not a passenger motor vehicle, such as if the vehicle is a motorcycle, motor home or off road vehicle.
- The vehicle was never transferred from the person who first acquired it from the manufacturer or dealer and so used as to become what is commonly known as “secondhand” within the ordinary meaning thereof.
- The vehicle was purchased for less than $3,000.
- The vehicle was more than 7 model years old at time of sale.
- The vehicle was declared a total loss by an insurance company.
- The vehicle’s odometer registered over 100,000 miles at time of sale.
- The vehicle was not purchased from a dealer (a person selling or offering for sale a used motor vehicle after selling or offering for sale 3 or more used motor vehicles in the previous 12 month period) or from a lessor who is a dealer and who sells or offers for sale a used passenger motor vehicle, subject to a motor vehicle lease agreement which was in effect for more than 90 days, to a consumer who is not the lessee, or a family member or employee of the lessee upon the termination of the lease agreement.
- If the vehicle had over 60,000 miles, the buyer, in negotiating with the dealer for a better price for the vehicle, you waived the right to a warranty in writing.
- The defect is the result of abuse, improper maintenance, neglect, modification or alteration of the vehicle or collision caused by someone other than the dealer.
- The defect is the result of damage of a covered item caused by of any commercial use of the vehicle.
- The defect is the result of damage of a covered item caused by operation of the vehicle without proper lubrication or coolant
- The defect does not substantially impair the use, value or safety of the used motor vehicle.
- The vehicle was subject to a motor vehicle lease agreement in effect more than 90 days and was sold by the lessor to the lessee or to a family member or employee of the lessee at the end of the lease agreement.
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What warranties are required under the New Jersey Used Car Lemon Law?
Provided your vehicle meets the above requirements and you don’t waive your right to a warranty, depending on the vehicle’s mileage, you would be entitled to the following warranty:
- Vehicles with 24,000 miles or less -- 90 days or 3,000 miles, whichever comes first.
- Vehicles with more than 24,000 miles, but less than 60,000 miles -- 60 days or 2,000 miles, whichever comes first.
- Vehicles with between 60,000 and 100,000 miles -- 30 days or 1,000 miles, whichever comes first.
If the dealer fails to provide this warranty to a qualified consumer and the consumer is not given the opportunity to waive their right to receive the warranty, the dealer commits consumer fraud.
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What does the New Jersey Used Car Lemon Law warranty cover?
The warranties under the law cover the following components of the vehicle:
- Engine: all internal lubricated parts, timing chains, gears and cover, timing belt, pulleys and cover, oil pump and gears, water pump, valve covers, oil pan, manifolds, flywheel, harmonic balancer, engine mounts, seals and gaskets, and turbo-charger housing. Note that housing, engine blocks and cylinder heads are covered only if damaged by failure of an internal lubricated part.
- Transmission Automatic/Transfer Case: all internal lubricated parts, torque converter, vacuum modulator, transmission mounts, seals and gaskets.
- Transmission Manual/Transfer Case: all internal lubricated parts, transmission mounts, seals and gaskets, but excluding a manual clutch, pressure plate, throw-out bearings, clutch master or slave cylinders.
- Front-Wheel Drive: all internal lubricated parts, axle shafts, constant velocity joints, front hub bearings, seals and gaskets.
- Rear-Wheel Drive: all internal lubricated parts, propeller shafts, supports and U-joints, axle shafts and bearings, seals and gaskets.
The Used Car Lemon Law is also supposed to cover “material defects” in the automobile, defined as: (1) a malfunction of a used vehicle fitting the Used Car Lemon Law’s requirements and subject to a warranty; (2) that substantially impairs the vehicle’s use, value or safety.
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What must I do under the New Jersey Used Car Lemon Law?
- During the vehicle’s warranty period, make arrangements to get the vehicle fixed by the selling dealer.
- Pay, if asked, a $50.00 deductible for the repair of any item covered under the warranty.
- Give the dealer a reasonable number of days or numbers of chances to fix the vehicle.
- Properly maintain, store, use and care for the vehicle and avoid making modifications to the vehicle that would void the Used Car Lemon Law warranty.
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What must the dealer do under the New Jersey Used Car Lemon Law?
- Upon failure or malfunction of an item covered by the New Jersey Used Car Lemon Law warranty during the vehicle’s warranty period, correct the malfunction or defect after a reasonable opportunity to repair the item. However, the manufacturer does not have to fix defects that are excluded for the reasons mentioned above (such as improper maintenance, abuse, misuse, etc.).
- Extend the term of any written warranty offered by the dealer in connection with the sale of the vehicle by any time period during which the vehicle is waiting for the dealer to begin or complete repairs of a material defect.
- If during the warranty period and after a reasonable opportunity to repair the vehcile, the dealer or its agent fails to correct the a material defect in the vehicle, the dealer must repurchase the vehicle and refund the consumer the vehicle’s full purchase price less a deduction for sales taxes, title and registration fees or other similar government charges, a reasonable allowance for any excessive wear and tear and a deduction for personal use. The refund is payable to the consumer and lienholder (if any) as their interest in the vehicle appear with the New Jersey Motor Vehicle Commission.
It is presumed that the dealer had a reasonable opportunity to correct or repair a material defect in the vehicle if:
- The same material defect has been subject to repair three or more times by the dealer or its agent and the material defect continues to exist; or
- The vehicle is out of service by reason of waiting for the dealer to begin or complete repairs of a material defect for a cumulative total of 20 or more days during the vehicle’s warranty period.
Meeting the presumption is not a requirement under the Used Car Lemon Law. This means your vehicle does not necessarily have to be out of service for 20 or more days or undergo a certain number of repairs for you to have a valid Used Car Lemon Law claim. Further, even if you meet the presumption, it does not mean that you shall automatically win your claim.
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What other types of conduct is the dealer prohibited from committing under the New Jersey Used Car Lemon Law?
Regardless of whether your vehicle meets the mileage and age requirements of the New Jersey Used Car Lemon Law’s mandatory warranty provisions and regardless of whether you agree to waive the warranty to which you may be entitled under the New Jersey Used Car Lemon Law, the following types of conduct are unlawful practices on a used car dealer’s part:
- To misrepresent the mechanical condition of a used motor vehicle.
- To fail to disclose, prior to sale, any material defect in the mechanical condition of the used motor vehicle which is known to the dealer.
- To represent that a used motor vehicle, or any component thereof, is free from material defects in mechanical condition at the time of sale, unless the dealer has a reasonable basis for this representation at the time it is made.
- To fail to disclose, prior to sale, the existence and terms of any written warranty, service contract or repair insurance currently in effect on a used motor vehicle provided by a person other than the dealer, and subject to transfer to a consumer, if known to the dealer.
- To misrepresent the terms of any written warranty, service contract or repair insurance currently in effect on a used motor vehicle provided by a person other than the dealer, and subject to transfer to a consumer.
- To fail to disclose, prior to sale, the existence and terms of any written warranty, service contract or repair insurance offered by the dealer in connection with the sale of a used motor vehicle.
- To misrepresent the terms of any warranty, service contract or repair insurance offered by the dealer in connection with the sale of a used motor vehicle.
- To represent, prior to sale, that a used motor vehicle is sold with a warranty, service contract or repair insurance when the vehicle is sold without any warranty, service contract or repair insurance.
- To fail to disclose, prior to sale, that a used motor vehicle is sold without any warranty, service contract, or repair insurance.
- To fail to provide a clear written explanation, prior to sale, of what is meant by the term "as is," if the used motor vehicle is sold "as is."
If the dealer commits any of these unlawful practices and as a direct result, causes a person loses property or an amount of money capable of being calculated with reasonable certainty, that person is entitled to restoration of the property or an award of three times the amount of money lost, plus attorneys fees, filing fees and costs of suit.
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How do I get relief under the New Jersey Used Car Lemon Law?
There is no “magical” Lemon Law fairy that gives out refunds or replacement vehicles to all deserving consumers. If the dealer is unable or unwilling to fix the car within a reasonable period of time and refuses to provide a refund as required by Law or if the dealer violates the types of conduct that is prohibited under the Used Car Lemon Law, the buyer can file a lawsuit against the dealer in the Superior Court of New Jersey. In certain cases, the dealer may be responsible for paying 3 times the amount of money that the consumer can prove they lost as a direct result of the misconduct as well as attorney’s fees and court costs. Within 10 days of filing any lawsuit, you must serve the New Jersey Used Car Lemon Law Unit with a copy of your initial pleading containing the Used Car Lemon Law claim, defense or counterclaim. Your attorney can handle this requirement. There is also an administrative legal process (an alternative to the Superior Court -- see discussion on Lemon Unit cliams below).
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Should I file a claim with the lemon law unit?
You are not required to file a claim with the Lemon Law Unit. If you file a claim with the Lemon Law Unit, you do not receive a trial by jury. However, if you or your attorney file a civil complaint in the Superior Court of New Jersey and properly demand a jury and your case is not dismissed before the jury deliberates, a jury of your peers decides whether you win or lose your case. Under New Jersey Law, if citizens have a valid case, they have a right to have their civil complaint decided by a jury. A Lemon Unit claim is decided by a single administrative law judge instead of by a jury of your peers. Who would you rather have decide your case? A judge alone or a jury of your peers? Another disadvantage to the Lemon Law Unit is that, while you may have more than one claim against the manufacturer (and thus multiple ways of recovering damages), you may bring only one type of claim against the manufacturer in the Lemon Law Unit proceeding. If you attempt to handle a claim by yourself through the Lemon Law Unit, you may lose your claim by failing to follow the required procedures or by failing to present sufficient proofs at any hearing. Usually manufacturers are represented by attorneys who are more familiar than you with such claims and quite often, consumers who represent themselves before the Lemon Law Unit fail to prove their claim.
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Do I have to start a claim with arbitration before filing a lawsuit?
Absolutely not. Under the New Jersey Used Car Lemon Law, if the manufacturer has its own dispute settlement or arbitration program, the buyer does not have to participate in it before filing a lawsuit against the manufacturer. Even if the buyer decides to participate in such a program, if dissatisfied with the result, the buyer may be able to file a lawsuit against the manufacturer. However, by deciding to proceed with an arbitration process before filing a lawsuit, many people waste much time and effort that could be better spent proceeding with a lawsuit. Often, Used Car Lemon Law dispute resolution programs increase rather than decrease the time it takes to resolve a case.
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How do I prove my case under the New Jersey Used Car Lemon Law?
As soon as you notice that your vehicle has a defect covered under the Used Car Lemon Law warranty, you must report the defect to the selling dealership immediately and arrange for it to be repaired by them or their authorized repair facility.
When you get your car repaired, before leaving the dealership or their authorized repair facility, you should ask for a repair invoice listing what was done to your vehicle. If the dealer or their agent refuses to give you an invoice, for each repair attempt or inspection of your vehicle by the dealer, you should keep a record of the date and mileage when the vehicle was brought in, each and every problem you complained of on that date and the date and mileage when the vehicle left the dealer or their authorized repair facility.
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Should I try to handle my case without a lawyer?
Since legal proceedings can be very complex, since all or most manufacturers use attorneys to defend Used Car Lemon Law cases and since the New Jersey Used Car Lemon Law permits successful claimants to recover reasonable attorney’s fees and court costs from the manufacturer, there is little benefit to a consumer trying to handle a Used Car Lemon Law case without being represented by an attorney. Indeed, it is often quite easy for manufacturers’ attorneys to defeat consumers who try to handle Used Car Lemon Law cases without an attorney. Also, if you try to represent yourself, you may fail to take an important step (miss a deadline, fail to complete crucial paperwork, etc.) and jeopardize your case.
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Should I wait to see if the vehicle is fixed?
If your vehicle has been at the manufacturer’s dealership at least 20 or more cumulative days for repairs for the same problem or has been subject to repair 3 times for the same problem, you should not wait any longer to ask an attorney to evaluate your claim. Legal proceedings may take time to be concluded and thus, the longer you wait to find out you have a case (or if you have a valid case, to stat the process), the longer you shall likely have to wait to conclude your case. Delay could hurt your case.
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If I financed the vehicle's purchase, can I stop making payments?
It is generally very, very risky for a consumer to decide to stop making payments on a vehicle simply because it doesn’t work well or even if it doesn’t work at all. Failing to make payments on a vehicle could result in: (1) the credit of everyone on the vehicle’s loan being damaged; (2) the vehicle being repossessed; (3) everyone on the vehicle’s loan being sued; (4) ultimately, in a money judgment being entered against you, which may even exceed the vehicle's purchase price. Failing to make payments on the vehicle’s loan could make a bad situation much, much worse. Always consult with an attorney before deciding to stop making payments on a vehicle loan.
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What if the dealer or manufacturer says I don't have a case?
Ignore them and seek competent legal advice. Only attorneys licensed in New Jersey to practice law are permitted to give legal advice and only they are able to evaluate if you have a valid claim. Until you speak with an attorney who is knowledgeable about this area of the law, do not draw any conclusions, regardless of what you heard from non-attorneys or read on the web.
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What will happen if I do nothing?
If you have a valid claim and you do nothing to enforce your rights, you shall be stuck with your defective vehicle and the seller, manufacturer or warranty provider shall get the best of you. There are strict time limits for perfecting and filing certain legal claims. Do not try to interpret the law by reading a website!
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What if I think my facts do not fit the lemon law?
You should always speak with an attorney before coming to any conclusions about your claim. Do not try to interpret the law by reading a website! However, even if the facts of your case do not fit the requirements of the Lemon Law, you may be entitled to sue the manufacturer or its selling dealer for a breach of your warranties under other state and federal laws. Click here to learn about Breach of Warranty claims.
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How do I find out if I have a case?
Click here to submit a free evaluation or call 609-714-2020.
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