Is my vehicle a lemon in Texas, and how do I file a complaint with TxDMV?

What makes a vehicle a lemon in Texas: the three tests

Texas presumes the manufacturer had a reasonable number of attempts when one of three tests is met, and in each test the repair attempts must have been made before the earlier of the date the express warranty expires or 24 months or 24,000 miles after original delivery, whichever comes first. Occ. Code § 2301.605(a)

• 4 repairs of the same defect. The same nonconformity continues to exist after being subject to repair four or more times by the manufacturer or its authorized agent or franchised dealer.Occ. Code § 2301.605(a)(1)
• 2 repairs of a serious safety hazard. The same nonconformity creates a serious safety hazard and continues to exist after 2 repairs. A serious safety hazard is a life-threatening malfunction or nonconformity that substantially impedes your ability to control or operate the vehicle for ordinary use, or creates a substantial risk of fire or explosion.Occ. Code §§ 2301.605(a)(2), 2301.601(4)
• 30 or more days in the shop. A nonconformity that substantially impairs the vehicle's use or market value still exists, and the vehicle has been out of service for repair for a cumulative total of 30 or more days. The days don't have to be in a row. Days when the manufacturer or distributor lent you a comparable vehicle while a franchised dealer repaired yours don't count.Occ. Code § 2301.605(a)(3), (c)

The periods are extended for any time repair services were not available because of a war, invasion or strike, or a fire, flood or other natural disaster. Occ. Code § 2301.605(b)

• What the manufacturer can argue. That the defect is the result of abuse, neglect or unauthorized modification or alteration of the vehicle, or that it doesn't substantially impair the vehicle's use or market value. TxDMV gives minor rattles and radio static as examples of defects that don't.Occ. Code § 2301.606(b) · TxDMV
• Market value counts. Impairment of market value means a substantial loss in market value caused by a defect specific to that vehicle.Occ. Code § 2301.601(1)

Who and what the Texas lemon law covers

Vehicles. New cars, trucks, vans, motorcycles, all-terrain vehicles, motor homes, towable recreational vehicles and neighborhood electric vehicles with a defect covered by the manufacturer's written warranty. A demonstrator that has not been titled before counts as new. Texas law treats a vehicle as new if it has not been the subject of a retail sale, regardless of its mileage. Not covered: repossessed vehicles, non-travel trailers, boats and farm equipment. TxDMV · Occ. Code § 2301.002

Owners. You can bring the claim if you are entitled to enforce the manufacturer's warranty and you:

• bought the vehicle at retail from a licensed dealer, or are a lessor or lessee (not a sublessee) who bought or leased it from one;
• are a Texas resident who registered the vehicle in Texas;
• bought or leased it at retail and are an active duty member of the United States armed forces stationed in Texas when the proceeding starts; or
• received it by transfer or assignment from one of these owners, and are a Texas resident who registered it in Texas. Occ. Code § 2301.601(2)

If the vehicle is leased, the order can end the lease and divide the refunds and the allowance for use between the lessee and the leasing company. Occ. Code § 2301.608(c)

Texas lemon law for used cars: repair help, not a buyback

Only new vehicles can get a refund or replacement. A used vehicle can get repair help under the Texas warranty performance law if it is still covered by the manufacturer's original warranty, not an extended service contract, or if the defect started and was reported to the dealer while that warranty ran and still exists. TxDMV · Occ. Code § 2301.204

1. 1Write to the dealer or the manufacturer. The complaint must be in writing and must specify each defect covered by the warranty. The letter generator below builds it.
2. 2Send a copy to TxDMV. That brings the case to the department. There is no filing fee for a warranty performance complaint.
3. 3Mediation, then a hearing if needed. A case advisor tries to resolve it; if that fails, a hearings examiner can order the repair.

The manufacturer's duty to repair continues after the warranty expires if the defect was reported during the warranty. Occ. Code § 2301.603(b) · 43 Tex. Admin. Code § 224.232(f)

The Texas lemon law deadline: 6 months

A lemon law complaint must be filed not later than 6 months after the earliest of two dates: the day the express warranty term expires, or the day 24 months or 24,000 miles have passed since the vehicle was first delivered to an owner. Occ. Code § 2301.606(d)

• If the 24 months come first, the deadline is 30 months after delivery: 24 months plus 6 months.
• If the vehicle reaches 24,000 miles first, it is 6 months after the day the odometer passed 24,000.
• If the warranty ends first, it is 6 months after the warranty expires.

The case begins when TxDMV receives the $35 filing fee, so a complaint sent without it does not stop the clock. TxDMV advises filing as soon as you realize the dealer is having trouble repairing the vehicle. 43 Tex. Admin. Code § 224.232(e) · TxDMV

The written notice the manufacturer must get

TxDMV can order a refund or replacement only if the manufacturer received written notice of the defect and had an opportunity to cure it. The notice can come from you, someone on your behalf, or the department. TxDMV asks owners to send it, preferably by certified mail, and to give at least one opportunity to cure. Occ. Code § 2301.606(c) · TxDMV

TxDMV's own sample letter asks the manufacturer to correct the problem within thirty (30) days of receiving the letter, and is sent certified mail, return receipt requested. Send the notice to the manufacturer itself, not only to the dealer, and keep the receipt: the complaint asks for the date the manufacturer first received written notice. TxDMV sample letter · 43 Tex. Admin. Code § 224.232(b)

How to file a Texas lemon law complaint with TxDMV, step by step

1. 1Gather the facts the complaint asks for. Your name and contact details; the year, make, model and VIN; the kind of warranty; the seller; the original delivery date; the mileage at purchase, when you first reported the problem and when you file; the dealer you first reported it to; each repair with its date and mileage and a copy of each repair order; and the date the manufacturer first got your written notice.
2. 2File online or by mail, with the $35 fee. Use TxDMV's Motor Vehicle Dealer Online Complaint System and pay by credit card, or mail the signed complaint with a check. The fee is not refunded, but if you win, the other side reimburses it.
3. 3A case advisor reviews it. The advisor checks that TxDMV has jurisdiction, notifies the manufacturer and the selling dealer, and shares the manufacturer's response with you.
4. 4Mediation. The advisor tries to settle the case through nonbinding mediation first, and both sides must take part in good faith.
5. 5The hearing. If mediation fails, a hearings examiner, a licensed Texas attorney, hears the case: in person in your city when possible, or by phone or video, with at least 10 days' notice. There are no depositions. You need no lawyer; if you use one, tell the examiner and the other side in writing at least five business days before. You can bring the vehicle for inspection and a test drive.
6. 6The decision. The examiner issues a final written order within 60 days after the hearing closes. You are not bound by it: if you don't accept it, the case is closed. Either side can ask the chief hearings examiner for a rehearing, then appeal to a district court in Travis County.

If no final order comes before the 151st day after the complaint, TxDMV must tell you by certified mail that the 150 days have passed and that you may sue; the period is extended for delays you ask for or cause. Occ. Code § 2301.607(c) · 43 Tex. Admin. Code §§ 224.232, 224.238, 224.252, 224.264, 224.266

What a Texas lemon law buyback pays: the refund formula

The refund is the full purchase price, less a reasonable allowance for your use, plus reasonable incidental costs. TxDMV says the price includes taxes, title and license fees; the rules exclude interest, finance charges and insurance premiums, and add back the $35 filing fee. The examiner tries to accommodate your choice between a refund and a replacement. Occ. Code § 2301.604(a) · 43 Tex. Admin. Code § 224.260(a), (b)(1) · TxDMV

The allowance for use has two parts, based on an expected useful life of 120,000 miles:

• the price times the miles from delivery to the first report of the defect, divided by 120,000; plus
• half (50%) of the price times the miles from that first report to the hearing date, divided by 120,000. 43 Tex. Admin. Code § 224.260(b)(2)

Example. A $45,000 vehicle with 4,000 miles at the first report and 10,000 more miles by the hearing: $45,000 × 4,000 ÷ 120,000 = $1,500, plus 50% of $45,000 × 10,000 ÷ 120,000 = $1,875. The allowance is $3,375, so the refund is $45,000 − $3,375 + $35 = $41,660, split between you and any lender by each one's interest. Occ. Code § 2301.604(b)

• Incidental costs. Reasonable and verifiable costs such as alternate transportation, towing, calls or mail to the manufacturer or dealer, meals and lodging when the vehicle failed on a trip, loss of personal property, attorney fees if you hired counsel after learning the manufacturer had one, and accessories added at or after purchase, less an allowance for use.43 Tex. Admin. Code § 224.262
• Replacement. A comparable new vehicle from the same product line, the same model year or newer, with comparable mileage. You pay the allowance for use and any price difference for a costlier model.43 Tex. Admin. Code §§ 224.230, 224.260(d)
• Towable RVs. The same two-part formula, counted in days of a 5,475-day (15-year) useful life, without days out of service for repair.43 Tex. Admin. Code § 224.260(b)(3)

Court, and the TxDMV process first

You must use up the TxDMV process before a refund or replacement is available. After that, you can bring a Deceptive Trade Practices Act claim against the manufacturer; a suit against the dealer under the sales or DTPA chapters can't get you the lemon law remedy. A contract clause that waives these remedies is void, unless it is part of a settlement. Occ. Code § 2301.607(a), (b), (g)

An appeal of TxDMV's final order goes to a district court in Travis County, under the substantial evidence rule. Occ. Code § 2301.609 · 43 Tex. Admin. Code § 224.268

Buying a vehicle that was a Texas lemon law buyback

• A disclosure goes with it. A manufacturer ordered to repurchase or replace a vehicle must, through its franchised dealer, issue a disclosure statement that it was repurchased or replaced under the lemon law. The statement stays with the vehicle through the first retail sale and gives TxDMV's toll-free number for the defect behind the order. Occ. Code § 2301.610(a), (d)
• It is fixed and warranted. The manufacturer must restore the cause of the buyback to factory specifications and issue a new 12-month, 12,000-mile warranty, whichever comes first, to the first retail buyer. Occ. Code § 2301.610(b) · 43 Tex. Admin. Code § 224.266(h)
• It is retitled and labeled. Before resale it is retitled in Texas, and a department-approved disclosure label is placed in a conspicuous location on the vehicle; dealers may not remove it before delivery to the first retail buyer. 43 Tex. Admin. Code § 224.266(e), (f)

Free help in Texas

Common questions about the Texas lemon law

Official sources

1. Texas Occupations Code chapter 2301 (§§ 2301.002, 2301.204, 2301.601-2301.613, 2301.703-2301.712): lemon law and warranty performance tcss.legis.texas.gov
2. Texas Department of Motor Vehicles: Texas Lemon Law txdmv.gov
3. TxDMV: sample letter for written notification to the manufacturer (PDF) txdmv.gov
4. TxDMV adopted rules: 43 Tex. Admin. Code chapter 224, subchapter G (§§ 224.230-224.268), lemon law and warranty performance (PDF) txdmv.gov
5. TxDMV adopted rules: repeal of the former 43 Tex. Admin. Code §§ 215.201-215.210 (PDF) txdmv.gov
6. TxDMV: the Office of Administrative Hearings txdmv.gov

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