Years ago, my then-boyfriend (now husband) bought a 1996 Mercury Tracer wagon from his octogenarian great uncle.

We should’ve backed out of the deal when we found cobwebs in the glove compartment and leaves on the dashboard. But, we were young (and broke) — the low mileage, price, and familial connection lured us into driving the beaut home.

Halfway from Davis to San Francisco, I noticed that the speedometer was stuck on 30 mph even though we were doing about 60. Then, a few weeks later, the brakes started leaking, the timing belt broke … it seemed like anything that could go wrong did.

Did we have a lemon? And what in the world could we do about it?

What makes a car a lemon?

For a car to be legally considered a lemon, it has to have a serious, irreparable problem that affects its value, safety, or usefulness. If, for example, the door handle falls off and the AC stops working but the car drives fine, then it’s probably not technically considered a lemon.

But if it doesn’t drive like it should under the warranty, it could be a lemon.

Lemon laws by state

While all 50 states have lemon laws in place, they do vary. Some states, like New York and Arizona, offer qualified used- and new-car buyers recourse if the vehicle turns out to be a dud. Others, like Colorado and Delaware, only extend lemon law protection to buyers of brand-new rides.

If you bought a lemon from a dealer

Typically, you have to notify the dealer of the defect within a certain period of time. The dealer (or manufacturer, depending on the state) has to be given a chance to fix it. If the problem persists and they can’t fix it after 3 or 4 tries, then you could get a new, comparable ride or your money back.

If you bought a lemon from a private party

Many states don’t extend lemon law protection to private party transactions, which means you could be out of luck. In our case with the Tracer, for instance, we couldn’t cancel the transaction since California’s lemon law only applies to dealer-bought cars.

Other states, like Massachusetts, do cover private party transactions — but they typically require proof that the seller did not inform the buyer of the defect.

The 3-day return policy

You may have heard that you can return a car within 3 days if you’re unhappy with it. Unfortunately, that’s a myth.

The federal 3-day return policy doesn’t apply to car purchases, so the moment you sign the papers and drive the car away, no refunds are mandatory.

What to do if you bought a lemon

Since there isn’t an easy one-size-fits-all answer, check your state’s rules here.

Louisiana (PDF)
Missouri (PDF)
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota (PDF)
Oklahoma (PDF)
Pennsylvania (PDF)
Rhode Island (PDF)
South Carolina
South Dakota
West Virginia

Alabama (PDF)
Idaho (PDF)

Insuring a car with a lemon buyback title

Lemons that are reacquired by the manufacturer, fixed, and put back on the market as used may seem like a steal, but they’re often uninsurable. Most companies won’t risk insuring a ride with a known safety defect — even if it’s been repaired (since there’s no way of knowing that the repairs really solved the problem).

While many states require these lemon buybacks to be “branded” on the title, others don’t. So do your homework (like checking out a vehicle history report) before you buy a used ride.

Lemon-free car insurance

Aside from offering you some useful advice, unfortunately we can’t insure you against buying a lemon. We can, however, insure you against a number of other “lemons” that life may hand you. Get an auto insurance quote today, make sure you have quality coverage, and be ready to make lemonade when things go wrong.

DIY hacks | Insurance 101 | Travel hacks


about Anne

If variety is the spice of a copywriter’s life, then Anne’s career at Esurance was akin to sassafras. From 2010 to 2014, she added a touch of zest to topics ranging from cleaning with baking soda to becoming a first-time homeowner.