Lemon Law Blog

The Car Allowance Rebate System (aka Cash for Clunkers) has ceased, but that does not mean you cannot get cash if your car is a clunker. 

We repeatedly discuss the Magnuson Moss Warranty Act, which provides distressed drivers with monetary damages if their car, truck or motorcycle has been back in the shop repeatedly for the same repairs, but does not fall under Lemon Law parameters.   Lemon Law Lawyer Craig Thor Kimmel recently joined Ukee Washington on Eyewitness News This Morning on the CW Philly to discuss the Magnuson Moss Law and how it works.

Under the Federal law, which provides protection for any consumer who purchases a product over $25, a consumer can receive monetary damages from the manufacturer to reflect the diminished value of the product as a result of the repeated problems.  At Kimmel & Silverman, we have used this Law to help folks with faulty vehicles, motorcycles, ATVS, computers and appliances. 

The best part for drivers who use this law is that they are entitled to monetary compensation even if the vehicle is finally fixed after repeated attempts. You receive money PLUS you get to keep your car.  In addition, the car is not branded in any way on carfax, the warranty remains completely in effect, and you do not need to disclose that you received this money at the time of sale or trade.  Also, just like the Lemon Law, legal help is 100% cost-free.

Here are some recent Magnsuon Moss victories.  (Of course, each case is different and we cannot guarantee that you would be entitled to the same compensation). 

2004 Mazda RX8: currently has over 57,000 miles
Engine flooded—replaced numerous components , including cat converter
Consumer received $6,000

2007 Suzuki SX4: currently has 60,000 miles
Defective engine block at 42,000 miles, out of service 2 months
Consumer received $4,500

2004 Volvo C70: currently has 37,000 miles
Car would not start x3
Consumer received $3,000

2007 Saturn Ion: currently has 43,000 miles
Loss of power starting at 15,000 miles—replaced wiring harness
Consumer received $3,000

2008 Cadillac Escalade: currently has 23,000 miles
Purchased used, replaced trailer hitch cover x3, stalling x2
Consumer received $4,000

2007 Subaru Impreza: Currently has 21,000 miles
Problem occurred right outside of Lemon Law
Check engine light x3—replaced left side cylinder & short block, out of service 46 days
Consumer received $7,500

2007 Hummer H3: currently has 23,000 miles
Car leased; Door lock & window malfunctions x6
Consumer received $3,000

2005 Jeep Grand Cherokee Laredo: currently has 60,000 miles
Purchased used; check engine light x4 under warranty
Consumer received $2,750

2004 Cadillac SRX: currently has 43,000 miles
Purchased used; engine replaced plus power steering leak x3
Consumer received $6,000

2005 GMC Sierra:  currently has 38,000 miles
Check engine light starting at 18,000 miles—eventually replaced turbo
Consumer received $4,000

If your car is still under an original or extended manufacturers warranty, and you have been in the shop three or more times for the same problem, please drop us a line to see if you are entitled to remedy under the Magnuson Moss Warranty Act.

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Thanks to the cash for clunkers program, more than 700,000 gas guzzlers are now off the road, replaced by more fuel-efficient vehicles.  It is a tremendous accomplishment and no doubt consumers and car dealers alike really profited off the program.

While the program officially came to a close Monday night, there are still car buyers out there waiting to hear if their rebate will go through.  Some have been told they will find out in a couple of weeks. As we discussed previously in the lemon law blog, there was quite a bit of fine print associated with this promotion and it is the dealer’s responsibility to ensure that the consumer qualifies for the rebate.  After all, if the dealer doesn’t do their job verifying everything prior to the transaction, they are the ones left stranded if the rebate never comes, right?

The answer seems to be affirmative, but one dealer in Philadelphia decided to test that theory.  After they completed the sale, and trashed the trade, the dealer found out that the insurance on this car had lapsed for two weeks during the last year of ownership.  That means they would not receive their rebate and that left them raving mad. They went back to the buyer, a second-year medical student, to try and recoup their $3,500.  And when we say try and recoup, we mean demand and threaten. 

So, who won and who was right?  For the answer, take at look at KYW TV Consumer Reporter Jim Donovan’s piece (featuring Kimmel & Silverman’s Founding Partner Craig Thor Kimmel) by clicking here.

If you find yourself in a position where you have already turned in your clunker and the dealer is demanding more cash, please contact us.

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President Obama introduced a “Cash for Clunkers” program last week. 

The $1 billion program will provide drivers with up to $4,500 in trade in value if they turn their poor-mileage clunker in for a more fuel-efficient vehicle. The government is hoping that the new program will take off the way it has in Germany, and will result in more than a quarter of a million new car sales throughout the Country while simultaneously getting gas guzzlers off the road.

According to an article in the Newark Sar-Ledger, this new law could increase Garden State car sales by roughly 24,000 sales and provide $50 million in additional tax and motor vehicle fee revenue for New Jersey. It is widely understood that other states will enjoy the same success.  That being said, the program is not as cut and dry as it may suggest.

For instance, the car that is going to be traded in must have been registered in the owner’s name and insured for at least one year. Eligible clunker cars must also be drivable and have an overall fuel economy rating of 18 or less miles per gallon.  Furthermore, in order to qualify for the top dollar amount, $4,500, the new vehicle has to get 10 miles per gallon more than the car being traded in, which is a pretty lofty feat. If you are looking at a van, SUV or pickup, it has to get 5 additional miles per gallon to receive the top rebate.  The new vehicle being purchased cannot cost more than $45,000.

If you cannot find a vehicle that gets 10 miles more per gallon, you can get a $3,500 rebate if you find a car that gets 4 additional miles per gallon. For vans, SUVs and pickups, an extra 2 miles per gallon will fetch a $3,500 voucher.

The program applies only to new cars purchased or leased between July 1and November 1.  Dealers have to register for the program in order to participate.

The other benefit to this program is while many of the clunkers traded in would not qualify for lemon law or breach of warranty protection due to their age and mileage, the new cars will qualify, giving consumers an extra piece of mind.

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