The Guide To Texas Lemon Law for New and Used Cars

October 15th, 2024 by

Texas Lemon Law Guide

Buying a vehicle is a big purchase, and nothing is more frustrating than when your car is constantly in the shop. Luckily, the Texas Lemon Law offers vital protection to consumers who buy cars that have persistent, unfixable defects. Whether it’s a faulty engine, malfunctioning brakes, or other serious issues, this law ensures that manufacturers are held accountable for vehicles that fail to meet quality standards. 

If your car needs constant repairs, the Texas Lemon Law may provide options for a refund, replacement, or repairs. In this blog post, we’ll break down what the Lemon Law in Texas is, what vehicles are covered, and the steps you need to take if you think your car might be a lemon. 

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What Is Lemon Law in Texas? 

The Federal “Lemon Law,” also called the Magnuson-Moss Warranty Act, was first passed in 1975. Since then, all 50 states, including Texas, have enacted their own laws to protect consumers from major manufacturer defects. 

Texas Lemon Lemon is designed to help consumers who purchase or lease new vehicles that end up being lemons, or cars having repeated defects. Suppose a vehicle has serious defects that impair its use, value, or safety and the manufacturer is unable to repair the issue after multiple attempts. In that case, the consumer may be entitled to a refund or replacement. 

How Does It Work?

Texas Lemon Law, which the Texas Department of Motor Vehicles administers, makes it easier for a consumer to get a refund or a replacement than going to court. If you’ve been sold a lemon, you can file a claim with the TxDMV. In your claim, you’ll have to show that the defect substantially impairs the vehicle’s use, market value, or safety and that the manufacturer was given a reasonable number of attempts to fix it. 

What Does It Cover?

The Texas Lemon Law primarily covers new vehicles that develop significant defects within 24,000 miles or 24 months, whichever comes first. But it isn’t limited to just cars, trucks, and SUVs. Texas Lemon Law also covers street-legal motorcycles, motorhomes, RVs, all-terrain vehicles (ATVs), and towable recreation vehicles (TRVs) like trailers and fifth wheels. 

The types of defects covered by Texas Lemon Law include major defects that impair the vehicle’s:

  • Use, including issues that prevent normal functioning
  • Value, including issues that reduce the vehicle’s market value
  • Safety, including problems that compromise the safety of the vehicle

However, the law does not cover:

  • Used vehicles that are out of warranty
  • Defects caused by abuse, neglect, or unauthorized modifications 
  • Non-substantial defects, like minor cosmetic issues that don’t affect the vehicle use, value, or safety
  • Commercial vehicles with a gross vehicle weight rating (GVWR) over 18,000 points 

How to Know If Your Car Is a Lemon

Multiple trips to the mechanic for the same vehicle can be annoying, but it doesn’t necessarily mean you have a lemon. Under Texas Lemon Law, your car likely qualifies as a lemon under the following circumstances: 

  • Your vehicle has substantial defects that impair the vehicle’s use, value, or safety. Some examples include engine problems, electrical system failures, brake failures, or defective steering. 
  • You’ve taken the vehicle to the manufacturer or authorized dealer multiple times to repair the same defect. 
  • The defect occurs within the first 24 months or 24,000 miles after purchasing or leasing the vehicle. 

If your car meets the above criteria, you may file a complaint with the Texas Department of Motor Vehicles. You’ll need to provide proof of the defect, repair attempts, and its impact on the vehicle. 

How Many Chances Does the Dealer Get to Fix the Problem?

Texas Lemon Law gives the dealer or manufacturer a reasonable number of attempts to fix the problem before the vehicle can be considered a lemon. Specifically, there are three main tests that determine how many chances the dealer gets:

  • Four-times test: The dealer or manufacturer has four attempts to repair the same defect. If the problem still exists after the fourth repair attempt, the vehicle may be considered a lemon. 
  • Serious safety hazard test: If the defect creates a serious safety hazard, the dealer or manufacturer gets two attempts to repair the issue. 
  • If the vehicle is out of service for a total of 30 days or more (not necessarily consecutive) due to repairs for the defect, the vehicle may qualify as a lemon. The days out of service must occur within the first 24 months or 24,000 miles of ownership. 

Texas Lemon Law for Used Cars

While the Texas Lemon Law primarily covers new vehicles, some used vehicles may also qualify. If the vehicle is still covered by the manufacturer’s original warranty (not an extended warranty or third-party service contract) and the defect and repair attempt have been made during this warranty period, the used car may be covered under Texas Lemon Law. 

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Texas Lemon Law for New Cars

The Texas Lemon Law for new cars provides protection to consumers who buy or lease new vehicles that turn out to have persistent defects. This includes new cars, trucks, SUVs, motorcycles, motorhomes, RVs, ATVs, and TRVs. The defect must arise within the first 24 months or 24,000 miles of ownership, whichever occurs first. 

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How to File a Lemon Law Complaint

If you believe you purchased a lemon, you can file a complaint through the TxDMV. The department charges $35 per complaint and requires you to notify the dealer. The Motor Vehicle Dealer Online Complaint System is the fastest way to do this. Some manufacturers have an informal dispute resolution process you’ll have to go through before filing an official complaint. 

Before filling out your complaint, you’ll want to make sure you have all the documentation you need. This includes sales or lease contracts, repair orders and receipts, warranty information, correspondence with the manufacturer, mileage records, and proof of vehicle out-of-service days. A TxDMV case advisor will review the complaint to make sure you’ve filled it out completely and that your vehicle is eligible. From here, the TxDMV will offer mediation to handle the complaint. If that’s unsuccessful, a formal hearing will be scheduled for you and the manufacturer to present evidence. The hearing examiner will provide a decision within 60 days of the hearing.  

What Happens If You Win?

If you win your case, the TxDMV will order the manufacturer to take corrective action. Depending on the specifics of your case, you may receive one of the following: 

  • Vehicle repurchase: The manufacturer may have to buy back the defective vehicle. This includes the full purchase price, taxes, title, and license fees, minus an amount based on how long the vehicle was used. 
  • Replacement: The manufacturer may be required to provide a replacement vehicle of a similar make, model, and value.
  • Repair: In some cases, the manufacturer could be required to repair the vehicle if the defect can be reasonably fixed. This is less common if multiple repair attempts have already been made. 

How to Get a Refund

To get a refund under the Texas Lemon Law, you must first go through the complaint process with the TxDMV. If you win and are granted a refund, the manufacturer will pay the purchase price of the vehicle, including taxes, title, registration fees, and incidental costs like towing, minus a reasonable usage fee. 

The Texas Lemon Law process can take several months, depending on how complex your case is. However, if the manufacturer does not comply with the repurchase order within a reasonable time, you can seek further legal recourse to enforce the decision. Make sure you follow up with the TxDMV or your legal representative if there are any delays or issues. 

A Dealership You Can Trust

The Texas Lemon Law protects consumers and ensures that manufacturers do their due diligence to engineer quality vehicles. At Tipton Hyundai, we understand how frustrating it is to purchase a new car that ends up causing nothing but problems. If you’re looking for a dealership you can trust, look no further than Tipton Hyundai. We have a huge inventory of new, used, and certified pre-owned vehicles and can help you find the right one for your needs. We’re located in Brownsville Texas but we can deliver to anywhere in the state including McAllen, Austin, San Antonio, Harlingen, and Dallas!

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