Wisconsin Lemon Laws for Used Cars: What To Know
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You probably remember getting a toy as a kid that just broke right out of the box. Maybe it was just a five-dollar piece of plastic, but it still hurt when something was broken through no fault of your own, and you probably wanted a new toy to replace it.
While there may not have been a policy in place for something that little, luckily, there is a policy to protect consumers from cars that break down while they’re still brand new. If a dealership sold you a brand new car that turns out to be a clunker from the start, you are entitled to a refund or replacement so that one of your biggest purchases doesn’t send thousands of dollars straight to the scrap heap.
Which vehicles are covered by Lemon Laws?
In the state of Wisconsin, lemon laws protect buyers of any new car, truck, motorcycle, or motor home. Unfortunately, mopeds aren’t covered by these protections even though they are motor vehicles. The protection isn’t afforded to any trailers or semitrailers. The car also has to be bought in Wisconsin and from Wisconsin; even if you live in Wisconsin and register your car there if you bought the car from another state, you would have to go through that state’s lemon law processes if your car is a lemon and you think you are entitled to compensation.
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What is a Lemon?
A lemon is one of the eligible vehicles mentioned above that has a serious defect due to the manufacturer’s failures and not due to the neglect or recklessness of the car owner. The defect has to substantially decrease the safety, value, or use of the vehicle. It has to have developed in the first year of owning the car while still under the manufacturer’s warranty (usually the first 12,000 miles, but check your warranty guide).
Small issues like the glovebox not closing or the passenger seat getting stuck in one position, while annoying, won’t make the car unsafe to drive or unusable. But if a real big problem comes up, something like the transmission failing, you can’t just tell the manufacturer, “Well, it’s broken, give me my money back.” If it is just one defect making the car unsafe or unusable, you have to prove that the dealer tried and failed to remedy the issue four times but could not get the vehicle into a usable state.
Make sure to keep records of the car’s problems, the mileage when you take it in for repair, and what repairs are being made to the car. If there is no one issue but several issues that keep coming up, the car is a lemon if it remains out of service for at least 30 days during the first year of ownership while still under warranty.
A car or motorcycle is considered out of service when it’s being held for repairs by the manufacturer or dealer and the owner of the car has no access to it. After two failed attempts to repair the nonconformity, the vehicle is considered out of service if it is still unsafe or unusable, even if the owner possesses it.
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Your next steps
If you have gone through the previous steps and know that your car is a lemon, then the time has come to file a Lemon Law claim with the manufacturer. This is where those records of repairs from earlier come into play.
In order to exercise the rights granted to you by the lemon laws in Wisconsin, you must fill out form MV2691, the Motor Vehicle Lemon Law Notice and Nonconformity Report, from the Wisconsin Department of Transportation. You will need to verify that the nonconformity developed, through no fault of your own, while the vehicle was still covered under its new car warranty and that you either made those four attempts to repair it or it was out of service for 30 days before the warranty expired. The form will ask you to list when the repairs occurred, how long they lasted, the mileage of the car before and after the repair, and what problem the car was brought in for. The form also allows you to request to either have the car replaced with a comparable vehicle and be compensated for collateral costs (loaner cars during repairs, towing, repair costs, etc.) to fully purchase the car fully refunded. Or, if the car is leased, to have all prior lease payments repaid to the consumer, and the remaining lease payments are refunded to the lessor.
After the form is sent to the manufacturer, alongside any dealership repair reports and a cover letter explaining the issues at hand, the manufacturer has 30 days to respond in writing to confirm the request or deny it.
If you request a replacement vehicle, the manufacturer has 30 days to confirm that they will provide you with a comparable vehicle. Once they have agreed to this, they have 45 days to procure your new vehicle. However, suppose they cannot find a comparable vehicle that can be delivered to you in those 45 days. In that case, the manufacturer reserves the right to instead issue you a full refund for the purchase price and collateral costs of the vehicle.
If you request a refund instead of the replacement, the manufacturer only has 30 days to issue you that refund after receiving form MV2691. When you receive either the refund or the new car, you must return the defective vehicle to the dealership and transfer the title back to the manufacturer. Whichever remedy you seek, you will owe the manufacturer a reasonable allowance for the use of the car.
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This depends entirely on the car’s mileage when the nonconformity was first reported and taken to the dealership for repair and is calculated by multiplying the original purchase price of the car (OPP) times the mileage reported (M), and dividing that by 100,000. That is OPP x M ÷ 100,000. That amount will be deducted from the refund. Suppose you get a replacement vehicle and the mileage deduction as calculated above is higher than the collateral costs you are refunded. In that case, you will owe that balance to the manufacturer.
If the manufacturer rejects your Lemon Law claim, but you believe you are entitled to compensation, you can challenge their decision in arbitration. This must be done through an arbitrator certified in lemon law disputes for your vehicle’s make by the state of Wisconsin. The dealership should inform you of the appropriate arbitrator, but the information is available at the Wisconsin Department of Transportation’s website. If your vehicle’s make does not have a certified arbitrator in Wisconsin, or if your arbitration does not go how you expected, you can file suit against the manufacturer.
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