Buying an “as-is” car is a money-saving option for buyers looking for an affordable used car.
But, buying a car as-is can also leave buyers with an undrivable car and no way to get it repaired or replaced.
Knowing the laws surrounding as-is car sales is the first step in protecting yourself from purchasing a malfunctioning or damaged vehicle. This includes understanding what constitutes an as-is car sale, the protections offered to buyers under federal and state laws, and the exceptions to these laws and protections.
What Is An “As-Is” Car Sale?
An as-is car sale refers to a sale in which a used vehicle is sold to a buyer in its current condition, with all known and unknown damages and defects. This means that when a car is sold as-is, the seller is often absolved of any responsibility to repair or replace any damaged or defective parts.
Vehicles sold as-is are typically sold without any type of warranty, and the term “as-is” is often used alongside “no warranty.” If the vehicle is sold without any express or written warranty, the buyer has no legal recourse to get their vehicle repaired or replaced.
However, just because a car is sold as-is does not automatically mean the car does not have a warranty. In some cases, a car may be sold with visible damage not covered under warranty, but may later experience a malfunction or defect that is covered under warranty. This is why it is so important to know about the different types of auto fraud, like odometer rollback, for example.
Protections Under Federal Lemon Law For As Is Cars
To qualify under Federal Lemon Law, known as the Magnuson-Moss Warranty Act, a car must have a substantial defect that affects the value or safety of the vehicle, and any defect must be repaired within a reasonable number of attempts, usually defined as three or more.
The number of repair attempts is cumulative, so if a car has multiple defects that require multiple repair attempts, the car may be declared a lemon. Once a car is declared a lemon, the buyer is entitled to a refund or replacement vehicle.
Buyers of as-is cars will likely be protected under Federal Lemon Law if they purchased their used vehicle under warranty or signed a contract that attests to the condition of the as-is vehicle. Under the Magnuson-Moss Warranty Act, sellers cannot deny (disclaim) or modify an implied warranty if the vehicle was sold under an express warranty.
Implied vs. Express Warranties
An “implied warranty” is also known as a “warranty of merchantability,” which is a promise from the seller that the product will work as it should.
An “express warranty” is written and contains the terms of the warranty, such as the length of the warranty, the items covered under warranty, and any exceptions to the warranty.
Express warranties include manufacturer’s warranties, a limited warranty issued by the dealer, or any extended warranty that was purchased from the dealer when the vehicle was sold.
For example, a dealer sells an as-is car under the manufacturer’s warranty, and recall is issued for the vehicle. If the manufacturer can’t repair the defect within three attempts, the buyer may be entitled to a refund or replacement vehicle.
Protections Under State Lemon Law
While the Magnuson-Moss Warranty Act provides federal Lemon Law protections, each state has its own Lemon Law regarding new vehicles and vehicles sold as-is.
Some states offer Lemon Law protections for as-is car sales by defining what constitutes a used car and the criteria that a vehicle must meet to be protected under the Lemon Law, while other states only offer Lemon Law protections for new vehicles.
Currently, there are only six states that offer Lemon Law protections for cars sold as-is or used: Connecticut, New Jersey, New York, New Mexico, Minnesota, and Massachusetts.
In these states, dealers selling as-is cars are often required to provide a warranty for the vehicle based on the price, age, or mileage.
In states like New York and New Jersey, dealers are required to provide limited warranties based on the current mileage of the car when it is sold. If a buyer reports any car complaints within the mileage or period specified, the dealer will be legally responsible for repairing their vehicle under warranty.
Each state has its own criteria for declaring a car a lemon, such as how many repairs must be attempted or how long the car is out of service. Typically speaking, a repair must be attempted at least three times, or the car must be out of service for at least 20 days to be declared a lemon in states that have used car Lemon Law protections.
New Jersey dealers must adhere to the following guidelines when providing a warranty for an as-is or used car:
- If the car has 24,000 miles or less, the dealer must provide a warranty for 90 days or 3,000 miles, whichever comes first
- If the car has between 24,000 and 60,000 miles, the dealer must provide a warranty for 60 days or 2,000 miles, whichever comes first
- If the car has between 60,000 and 90,000 miles, the dealer must provide a warranty for 30 days or 1,000 miles, whichever comes first
To qualify under most state Lemon Law protections, the vehicles must meet certain requirements, usually related to how the vehicle is used, the price of the vehicle, the period of ownership, and how many miles the vehicle has been driven.
In New York, used or as-is vehicles covered under the state Lemon Law must meet the following criteria:
- The vehicle must have a purchase price or value of $1,500 or more
- The vehicle must be purchased from a dealer within the state of New York
- The vehicle must have more than 18,000 miles on the odometer
- The vehicle must have less than 100,000 miles on the odometer
- The vehicle must be used primarily for personal use
If you plan on buying an as-is car in your state, make sure you research the used car Lemon Laws to determine if you will be protected.
Exceptions to Lemon Law For As Is Cars
If a car has been returned under the Lemon Law, repaired, and then resold, it is then no longer covered under the Lemon Law.
Sellers and dealers must disclose the car’s Lemon Law status during the sale, which offers some protection, but the car will not be covered under the Lemon Law after that.
Protect Your Rights, Protect Yourself
The best way to avoid a catastrophic as-is car purchase is to examine the Lemon Law protections in your state and to thoroughly research any car you plan on purchasing.
If you have more questions about Lemon Law in your state or believe you have a Lemon Law claim, the Robison Lemon Law Group is here to help.
To schedule a no-cost, no-obligation consultation with one of our experienced Lemon Law attorneys, please visit our site or call (844) 386-0831.