How to Cancel a Vehicle Purchase Agreement

Lemon law varies from state to state.

Although a binding agreement, the contract is subject to laws protecting the buyer from vehicle malfunctions. Lemon laws grant buyers the right to cancel purchase agreements for vehicles that fail to operate after a short period of time from the purchase. Lemon law varies from state to state. Some states legislate laws for new car purchase agreements, while others apply lemon law for used car purchases.

Things You'll Need

• Vehicle title
• Estimate for repairs
• Notice of intent to void contract

Instructions

1. Take the car to a licensed inspection station within seven days of registering for the 169 Point Vehicle inspection. Do not allow the dealer to complete the inspection.

2. Obtain a written statement signed by an authorized agent stating reasons why the vehicle failed the inspection. The statement should note standards for areas in which the vehicle failed.

3. Demonstrate that the estimated cost of repairs for safety or emissions related defects is greater than 10 percent of the vehicle's purchase price. This requires that the mechanic locate the problem and estimate the cost of repairs.

4. Notify the seller of your intent to void the vehicle purchase agreement via certified mail with return receipt requested or by regular mail. Enclose copies of all documents and keep copies for your records.

5. Negotiate with the seller. Be firm. The car was purchased in good faith, so feel comfortable enough to refuse unsatisfactory offers and request a full refund.

Tips & Warnings

• To recover a refund for the title, contact the Registry of Motor Vehicles. Explain that you returned the vehicle to the seller under lemon law and you are requesting a certificate of title. Then, assign and transfer the title back to the dealer.

• To recover a refund for the sales tax and registration fee, fill out an abatement form through the state revenue department. If the license plate is returned within 10 days from the date of registering the car, you can receive a full refund less a $5 charge.

• If your purchase was not protected under lemon law, then continue to pursue the issue. The implied warranty of merchantability applies for the purchase of used cars.

References

• Massachusetts Consumer Resource Page: Lemon Law
• "The Lemon Law Bible;" Steve Lehto; 2000