What to Know About the North Carolina Lemon Law

Aug 17, 2022 by Juan Herrera, Vice President, Dispute Resolution Programs, BBB National Programs

Next in our blog series reviewing the state lemon laws is the Tarheel State – North Carolina. 

In this series, we break down what the lemon law does and does not cover in each state because although there is a federal lemon law, called the Magnuson-Moss Warranty Act, states also have their own laws to help consumers who purchase defective vehicles. If you are not familiar with the lemon law, before you get started read Lemon Law 101: Understanding the Law and Your Rights. 

So far, we have covered New York, Georgia, Texas, California, and Florida. Compared to these states, North Carolina’s lemon law is relatively straightforward. 

 

What is the North Carolina lemon law?

The North Carolina lemon law, titled the New Motor Vehicles Warranties Act, helps consumers who buy or lease a new motor vehicle from a manufacturer or dealer within North Carolina when their new vehicle must be repaired several times. 

 

What vehicles are covered?

North Carolina’s lemon law covers almost any new motor vehicle or motorcycle sold or leased in North Carolina. The law only excludes mopeds, electric-assisted bicycles, house trailers, or any motor vehicle that weighs more than 10,000 pounds. When it comes to used cars? Used cars are not covered.

 

Who is covered under the North Carolina lemon law?

Consumers who purchase or lease a new motor vehicle from a commercial lender, lessor, manufacturer, or dealer are covered under North Carolina’s lemon law.

 

What problems does the lemon law cover?

The North Carolina lemon law does not explicitly define what types of nonconformities (defects or conditions covered under the manufacturer’s warranty) it covers, however, it does state that a defect or condition that substantially impairs the value of the motor vehicle to the consumer is considered a nonconformity. 

The law does not cover nonconformities that are the result of abuse, neglect, odometer tampering by the consumer, or unauthorized modifications or alterations of a motor vehicle. For example, if you do not get regular oil changes for your vehicle, the lemon law may not cover nonconformities resulting from your neglecting to change the oil.

 

What is the manufacturer’s duty to repair?

If you purchase or lease a motor vehicle in North Carolina and you notify the manufacturer, its agent, or its authorized dealer of a defect within the greater of 1) the express warranty, 2) one year, or 3) 12,000 miles after the original delivery date, then the law requires the manufacturer to repair your vehicle free of charge. It is the manufacturer’s responsibility to repair the vehicle to conform with the express warranties, even if these repairs must be made after the expiration of the warranty period. 

If the manufacturer’s warranty is expressed in terms of a number of miles, that number of miles begins to accrue once the new vehicle is delivered to the consumer. For example, if you purchase a new vehicle with a manufacturer’s warranty of 18,000 miles, but it is delivered to you with 60 miles on it, then the manufacturer’s warranty covers your new vehicle up to 18,060 miles. 

Consumers should notify the manufacturer of any nonconformity directly and in writing using the mailing address as provided in the vehicle’s warranty or owner’s manual. The manufacturer is then allowed a reasonable period to remedy the nonconformity, however, this reasonable period should not exceed 15 calendar days. 

 

What is considered a “reasonable” number of repair attempts?

The North Carolina lemon law creates a presumption that a reasonable number of attempts have been made if either of the following occur:

  • The vehicle has been subject to repair four or more times by the manufacturer or its authorized dealers for the same nonconformity, but the nonconformity continues to exist, or 
  • The vehicle is out of service by reason of repair of one or more nonconformity for a cumulative total of 20 or more business days.

 

Replace or Repurchase: What is the manufacturer’s responsibility?

If the manufacturer is unable to repair the vehicle within a reasonable number of attempts, which occur no later than 24 months or 24,000 miles following the delivery of the vehicle to the consumer, the manufacturer must repair or replace the vehicle at your choice. 

If you elect to receive a replacement vehicle, you are entitled to receive a comparable replacement motor vehicle.

If you choose to get a refund, the manufacturer must pay:

  1. The full purchase price,
  2. All collateral charges (e.g., sales tax, license and registration fees, and similar government charges),
  3. All finance charges incurred by the consumer after they first report the nonconformity, and
  4. Any incidental damages and monetary consequential damages,
  5. Less a reasonable allowance calculated by taking the number of miles attributed to the consumer’s use up to the earlier of the date of the third repair attempt or the 20th cumulative business day the vehicle is out of service for repair, divided by 120,000. 

 

How can BBB AUTO LINE help me?

BBB AUTO LINE Is one of the largest and longest-running out-of-court dispute resolution programs in the United States. For the past 40 years, we have helped consumers and businesses resolve vehicle warranty, lemon law, and class action disputes in a hassle-free, timely, and cost-effective manner. 

If you have an unresolved warranty dispute in North Carolina, BBB AUTO LINE may be able to help. 

The North Carolina lemon law requires that to be eligible, a BBB AUTO LINE claim must be filed within four years from the date the defect is discovered. However, some manufacturers could limit this time period to as soon as one year from the date the defect is discovered. You should check your owner’s manual or warranty to see when a complaint must be filed, because the manufacturer may only allow for complaints one year after purchasing a new vehicle. 

Furthermore, manufacturers may require consumers to use an informal settlement procedure such as BBB AUTO LINE prior to bringing any litigation against the manufacturer. 

To learn more, go to bbbautoline.org, or call us at 1-800-955-5100.

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