Leasing a vehicle has numerous benefits compared to purchasing. There’s no down payment, you aren’t paying interest on a loan, you get to drive a newer model, and you don’t have to worry about depreciation.

However, regardless of whether you buy or lease, there is always the risk that the vehicle might be defective. Thankfully, if you find yourself in this messy situation, the law is on your side. While lemon law is a little different in each state, in California, lemon law applies to both purchased and leased vehicles.

While this perk can certainly do a lot to help your situation, it’s important to note that lemon law is chock full of small details, and every case will be slightly different. In fact, it’s the little details that truly determine whether or not a vehicle actually is a lemon. If you recently leased a vehicle and believe it to be defective, there are a few very important things you need to know about the process and how your unique situation plays into it. Let’s dive in.

Note the Exceptions for Leased Vehicles

On the surface, lemon law seems pretty straightforward: you buy or lease a faulty vehicle, and the manufacturer is required to make it right.

Even though leased vehicles are covered under lemon law, there are still some exceptions that will potentially rule your case out. For starters, the most crucial aspect of any lemon law claim is the nature of the defect. In order for a vehicle to be deemed a lemon in California, it must have a defect that substantially impairs your use, value, or safety. This is referred to as a “defect” element and is the area of lemon law that tends to get a little dicey. These types of defects don’t always involve faultiness with crucial components of the vehicle, such as the engine, transmission, electrical, steering, braking, etc.

Now, if you believe there is an issue with any part of your leased vehicle, there are a handful of exceptions that may affect the strength of your case.

  • The defect is not “substantial.” Even a broken CD player or radio knob may qualify under the right circumstances.
  • The defect is caused by an aftermarket part installed by a third-party.
  • NOTE: Whether the vehicle is not registered under the California Vehicle Code–This scenario alone does not disqualify your off-road vehicles like ATVs, dirt bikes, etc.
  • The defect is not covered by the express warranty of the leased vehicle.
  • The leased vehicle did not come with an express written warranty.
  • The defect was caused by driver misuse, abuse, or neglect.
  • If your leased vehicles defect(s) meets one of the above criteria, you may not be covered by the California lemon law. You need to have a firm understanding of the exceptions before you get the process moving.

Know How to Cancel the Lease

So, assuming that you have determined that your vehicle is a legitimate lemon, the next step is forcing the manufacturer to buy-out your lease. Unfortunately, you cannot simply waltz into the leasing office and ask to void the agreement due to a defect. You should have a signed contract in place with the company that details the scenario and circumstances that allow you to terminate the lease.

Did you miss that in the fine print? Don’t panic. You are still covered under the California lemon law.

When you are trying to terminate your lease due to a defect, success or failure here all comes down to the paperwork you have. In regards to the law, it is best to have proof that:

  • The manufacturer made two or more attempts to repair a substantial warranty-covered defect.
  • The manufacturer has made four or more attempts to repair the same substantial warranty-covered defect.
  • The vehicle has spent more than 30 total days in the shop to repair any number of substantial warranty-covered defects.

If you can provide credible paperwork, or other evidence, that clearly shows the defect is substantial and meets the criteria listed above, the manufacturer may be required to take one of several actions. This may include replacing the vehicle, reimbursing you for the payments you’ve made, and of course, buying you out of the lease.

What About Leased Business Vehicles?

When you lease a vehicle for business purposes and it turns out to be defective, it’s pretty easy to start panicking. After all, you need those vehicles to run your operation. The good news is that vehicles leased for business in California may be protected under lemon law the same way as passenger vehicles.

However, there are a couple key factors that come into play and could be an exception.

  • The vehicle you leased weighs less than 10,000 pounds. Basically, while you can lease a vehicle for business purposes, it must be meant for passenger transportation (e.g. a car, truck, SUV, motorcycle, etc.). It cannot be a commercial truck or other piece of heavy machinery.
  • The business must not lease more than five vehicles. In California, the lemon law typically works to help small businesses affected by lemons. Larger companies with a big fleet do not always apply for benefits, unfortunately.

Leased lemons for business can definitely be a bit tricky once you get into the nitty gritty details. That said, when you search for lemon law lawyers near me, you need to do your proper research and see how much experience the firm has with business-related lemon cases.

Over to You

Leasing a new vehicle is very exciting. However, this excitement can quickly be turned into frustration by a substantial defect. The good news is the law in California is on your side and there to help you get justice from the manufacturer, and in the case of a leased vehicle, from the leasing company as well.

Always remember, if your vehicle ends up being a lemon, the manufacturer is responsible for ALL of your legal costs. One of the biggest mistakes a consumer can make is choosing a discount lawyer for their case. If you are convinced your vehicle is a victim of manufacturer negligence, don’t waste another minute and get in contact with a specialized local lemon attorney.

Schedule a FREE consultation and we will help you understand how your scenario fits into the legal process of lemon law.

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