Prevailing Through Endurance

What happens if you bought a lemon with financing?

On Behalf of | Feb 28, 2022 | Lemon Law

If you get your car via financing, it can be frustrating to find out you ended up with a lemon. This is because you will have to pay for a vehicle that spends more time in the garage getting repairs than on the road. In such a case, are you protected by lemon car laws?

Fortunately, yes. You are still protected against substantial defects in your new vehicle even though you got it on loan. Here is what you need to know.

You still need to clear the loan

Defaulting on the loan because your car has defects could end up ruining your credit score. In addition, the vehicle may be repossessed, leaving you with no right to make a claim. It is important to clarify any issues regarding lemon car claims with the lender since there may be special procedures to handle such cases.

In case of a refund, you are only entitled to the car’s fair market value, not the amount of loan you took out to get the car. In such an instance, if the car’s value is less than the loan you took, you will still have to pay the balance to clear with the lender.

Don’t wait before taking action

If you believe the car you bought is a lemon, you need to take swift action. The value of a vehicle depreciates with time, and even if you are allowed four years after you discover a defect to make a lemon car claim, it is not advisable to wait that long. It is crucial to have the necessary knowledge when going through this complicated process to avoid any mistakes that could make you lose out in the end.