The North Carolina Lemon Law

The North Carolina lemon law protects every Carolinian who purchases a new motor vehicle in the state.

What Vehicles Does the NC Lemon Law Cover?

The lemon law in North Carolina covers new cars, pickup trucks, SUVs, motorcycles, and most vans, if they were purchased in NC. The coverage lasts for 24 months, or 24,000 miles, whichever comes first.

The defect must substantially impair your use of or the safety of the vehicle, or substantially reduce its market value (for example, faulty air conditioning or peeling paint). The problem must first occur while the vehicle is still covered by the warranty, within the 24 month/24,000 mile period.

You must inform the manufacturer in writing about the defect, and give them no more than 15 days to fix it. They have at least four repair attempts, including that last attempt. Or, if the vehicle is out of service due to repairs for a total of 20 business days or more for any number of defects, it's considered a lemon.

I Guess I Have a North Carolina Lemon. What Can I Do?

Write to the manufacturer to say that you have a lemon, and that you want a replacement or refund. Photocopy your notes about the problem(s), all repair orders and work invoices, and any supporting documentation you may have. Send the letter and all the copies by certified mail, return receipt requested. Remember to photocopy your letter, and keep the copy for your records.

The manufacturer has one last chance to fix the vehicle, within 15 days of receiving your letter. If it does not make a repair attempt during that period, or cannot fix it, you're entitled to your refund or replacement.

Arbitration and Law Suits

The North Carolina lemon law does not require you to attend an arbitration hearing in case the manufacturer refuses to honor your claim. However, some manufacturers require that you attend a hearing before you can file a lemon law suit in court. These informal dispute resolution procedures are often binding on the manufacturer, but you aren't bound by the final decision.

If you disagree with the decision, you can file a suit against the manufacturer. If you do, I recommend that you consult a lemon law attorney, a lawyer experienced with the North Carolina lemon law.

Refund or Replacement?

You're entitled to either a refund or a replacement. It's your choice. The lemon law in North Carolina does not force one or the other on you.

A replacement must be a comparable new vehicle, although the law does not define what "comparable" means. Normally, it will be the identical make and model, if it's still available.

If you prefer a refund, you'll receive the following...

• The full purchase price, which includes any dealer-installed options, dealer preparation, and the non-refundable portions of extended warranties or service contracts you purchased. Undercoating is also covered here.

• Sales tax, and license and registration fees.

• All finance charges that you incurred after the first report of the problem to the dealer or manufacturer. This is an excellent reason to report all defects as soon as you detect them, no matter how small!

• Any incidental costs, such as towing or rental car fees due to repair of the defect.

The manufacturer is entitled to deduct a reasonable use fee based on the purchase price and the mileage you put on the vehicle.

North Carolina Lemon Law Summary

The lemon law in North Carolina covers new motor vehicles purchased in the state, for a period of 24 months or 24,000 miles. If your vehicle has been repaired four or more times for the same defect, or has been out of service for at least 20 business days for any number of defects, you're entitled to a refund or replacement.

The sooner you report each problem, the sooner you'll have your replacement. If you choose a refund, it will be bigger if you report the defect sooner.