Common Lemon Law Misconceptions

Reviewed by Elodie Sark (ES), Editor-in-Chief — Consumer Protection & Lemon Law Practice. Updated May 2026.

Lemon law is a relatively straightforward area of consumer protection law — clear numerical thresholds, a defined refund formula, and mandatory attorney fee shifting that makes legal access economically accessible. Despite this clarity, consumers regularly make errors based on misconceptions about how the law works. The five myths below account for most of those errors.

Myth 1: "The Manufacturer Has to Give Me a Full Refund With No Deductions"

Almost all state lemon laws allow the manufacturer to deduct a mileage offset from the repurchase price, representing the value of the miles the consumer drove before the defect first arose. The rationale is that a consumer who drove 15,000 miles before experiencing a defect received 15,000 miles of use that the manufacturer should not have to refund. California, the most widely referenced state, uses a formula of (miles driven before first defect report ÷ 120,000) × purchase price.

For a $40,000 vehicle with 10,000 miles driven before the defect appeared, the California offset is (10,000 ÷ 120,000) × $40,000 = $3,333 — leaving a $36,667 refund base before incidentals. The offset is applied to the miles before the first report of the defect, not the current mileage — which is why it matters strategically to report defects to the dealer as soon as they appear, rather than waiting. Each mile driven before the first report increases the offset deduction.

The good news: the offset is typically modest for vehicles that develop defects early (first 5,000–10,000 miles), and the incidentals (sales tax, registration, finance charges) that are added back to the refund base can partially or fully offset the mileage deduction. The net result is often a refund very close to (but slightly less than) the full purchase price for early-manifesting defects. Some states — a minority — allow no mileage offset at all, providing a full 100% refund of the purchase price plus incidentals.

Myth 2: "Used Cars Aren’t Covered by Lemon Law"

State lemon laws primarily cover new vehicles, but this does not mean used vehicle owners have no recourse for defective vehicles. Several avenues may apply:

Federal Magnuson-Moss Warranty Act: This federal law covers any consumer product — including used vehicles — sold with a written warranty. If you bought a used vehicle that came with a remaining manufacturer’s warranty (not just an "as-is" buyer’s guide), and that warranty was breached by a defect the manufacturer cannot fix, you may have a Magnuson-Moss claim. The Act provides mandatory attorney fees for prevailing plaintiffs, making it economically viable even for used vehicle claims. There is no specific repair attempt threshold — just an unremedied breach after reasonable opportunity to cure.

Certified pre-owned vehicles: Some states explicitly include CPO vehicles in their lemon law statutes when the vehicle is still under the original manufacturer’s warranty. New York’s used car lemon law, for example, covers used vehicles sold by dealers with under 36,000 miles, providing additional protections beyond Magnuson-Moss.

Express warranty claims: A dealer who makes specific written promises about a used vehicle’s condition may have created an express warranty enforceable through state contract law, even without a manufacturer’s warranty.

"As-is" sales with no warranty of any kind have the weakest protection — but even "as-is" vehicles may have claims if the seller knew of and concealed defects, which can support fraud or implied warranty claims in some circumstances.

Myth 3: "I Have to Use the Manufacturer’s Arbitration Program — I Have No Choice"

Whether manufacturer arbitration is mandatory before filing suit depends on the state. In California — the most important state for lemon law purposes — arbitration through manufacturer programs is entirely optional for the consumer under Civil Code § 1793.22. California consumers can go directly to court without first participating in any manufacturer-sponsored arbitration program. Many consumers are told by manufacturers or dealers that they "must" use arbitration first; this is legally incorrect in California.

In other states, the picture varies. Texas requires completion of the manufacturer’s dispute resolution process before filing with the Texas DMV. Florida may require arbitration if the manufacturer participates in a certified program — but the arbitration result is not binding on the consumer, who can reject the arbitration outcome and still file suit. Most other states do not mandate pre-litigation arbitration as an absolute prerequisite to court filing.

The critical rule: never sign any document waiving your right to a court trial as a condition of participating in manufacturer arbitration. Pre-dispute binding arbitration clauses, which require all disputes to be resolved through private arbitration rather than in court, have been included in some vehicle purchase agreements. Whether these clauses are enforceable under state lemon law is a legal question that varies by state and has been the subject of significant litigation. An attorney can evaluate whether an arbitration clause in your purchase contract is enforceable and, if so, what options remain.

Myth 4: "I’ll Have to Pay an Attorney — It’s Not Worth It"

This is the misconception that most directly causes consumers to abandon meritorious lemon law claims. The reality is the opposite: in virtually every successful lemon law case under both state law and the federal Magnuson-Moss Warranty Act, the manufacturer is required to pay the consumer’s attorney fees. Lemon law attorneys work on a fee-shifting basis, not traditional contingency — they take cases they believe will succeed, represent the consumer throughout the process, and get paid by the manufacturer when the case resolves in the consumer’s favor.

For the consumer, this means hiring a qualified lemon law attorney typically costs nothing out-of-pocket in successful cases. The attorney’s incentive is aligned with the consumer’s: the attorney is paid more for a larger recovery and for winning, not for settling quickly at an inadequate amount. Many lemon law attorneys have developed efficient processes for evaluating and handling claims, making them particularly well-suited to handle these cases from initial evaluation through resolution.

One important nuance: some law firms market "lemon law services" and charge upfront fees, or take a percentage of the recovery in addition to (or instead of) fee shifting. The traditional fee-shifting model — where the attorney receives only what the manufacturer pays, with no charge to the consumer — is the norm in lemon law practice, but not universal. At the initial consultation, confirm the fee arrangement before agreeing to representation.

Myth 5: "The Manufacturer Will Fix It Eventually — I Should Just Keep Waiting"

Patience is understandable when dealing with vehicle defects, but continuing to bring the vehicle in for repair attempts beyond the legal qualification threshold — without asserting your lemon law rights — can actually complicate a claim. Here is why:

First, lemon law claims are typically time-limited to the warranty period or a defined coverage window (California: within the warranty period with a 18-month/18,000-mile presumption period; New York: 2 years/18,000 miles; Texas: 24 months/24,000 miles; Florida: 24 months). Each additional month of accepting repair attempts is a month inside the coverage window spent in legal limbo rather than asserting rights.

Second, accepting many additional repair attempts after the threshold has been met may give the manufacturer an argument that the consumer was satisfied with the repair process and did not assert lemon law rights in a timely manner — creating a potential waiver or estoppel argument. While courts generally reject this argument when the consumer is unaware of their rights, it adds unnecessary complexity.

Third, and most practically, the manufacturer’s motivation to fix the defect rather than repurchase the vehicle does not necessarily align with the consumer’s best interest. Once the legal threshold is met, the consumer has the right to demand repurchase. Continuing to accept repair attempts in the hope that the next one will work indefinitely delays the assertion of clear legal rights. Consult a lemon law attorney once you believe you have met the qualifying thresholds — the free consultation costs nothing and will tell you where you stand.

Return to the how lemon law works guide, the what to do guide, or the calculator.