The Lemon Laws, which is the common nickname for the various state laws, provide legal remedies to consumers who purchase cars, RVs, boats, motorcycles, wheelchair and computers that fail to meet quality and performance standards. The federal lemon law, more properly the Magnuson-Moss Warranty Act, can cover purchases in any state.

State laws vary, so that a leased vehicle may or may not be completely covered under the Lemon Laws. Lease agreements themselves can be very tricky and confusingly worded. As a result, there could be language that would adversely affect your ability to recoup losses in a lemon law damage claim on a leased vehicle. Prior to commencing a claim under the lemon laws for a leased vehicle, you should consult an attorney who can assist you in determining whether or not you have a legitimate claim under the lemon laws.

It can be difficult to establish damages in a leased vehicle lemon law claim. This may be partly due to the fact that under a lease, there is little to no equity in a purchase and, therefore, limited damages. If you do lease your vehicle and think you have a lemon law claim, there are a few things you should know. First, your damages are generally limited, as mentioned above, based upon how much you have actually paid into the vehicle at the time of the claim.

Secondly, you should bring any lemon law claim earlier in your lease, rather than later, as the less time you have left in your lease the more likely your claim can be ignored until it “goes away” with the termination of the lease. Once the lease has expired and you have returned the car, you can continue with the claim, however, it is not worth much at that point and it would be wiser to settle.

Another issue that can negatively impact on your claim is the mileage on the leased vehicle. You will have a much weaker claim should you have significantly exceeded the mileage allowed under the lease.

Also, if you do receive damages, you will still have to pay off the lease or it can adversely affect your credit rating. Ideally, your lease should be completely paid for in the claim; however, in some cases you are paid only for the residual value of the vehicle. The residual value is the purchase price of the vehicle at lease termination. Additionally, should you settle your claim, you may get even less.

Claims for lease or finance fraud are not handled under the lemon laws. There are many types of unfair and deceptive practices that fall under the banner of lease fraud, including abusing the lease terms, additional costs that were not explained, manipulation of residual values, early termination penalties that are excessive, and other deceptions perpetrated by sellers relative to the transaction. If you feel you have claim for fraud, you should contact an attorney who can assist you in filing such a claim.