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Lemon law arbitration
Lemon law arbitration is a hearing outside court where a program decides whether the maker must buy back or replace the car. 18 states run a program of their own; elsewhere the maker runs one, often through an outside provider such as BBB AUTO LINE. A maker's program that follows the federal rules must decide within 40 days, and its decision does not bind you: you can still go to court.
States with their own program
California (California Department of Consumer Affairs, Arbitration Certification Program), Connecticut (Connecticut Department of Consumer Protection, Lemon Law Program), District of Columbia (Office of the Attorney General for the District of Columbia, Office of Consumer Protection), Florida (Florida Attorney General, Lemon Law Arbitration Program (Florida New Motor Vehicle Arbitration Board)), Georgia (Georgia Attorney General's Consumer Protection Division), Hawaii (Hawaii Department of Commerce and Consumer Affairs, Regulated Industries Complaints Office (RICO), State Certified Arbitration Program), Iowa (Iowa Attorney General, Consumer Protection Division), Maine (Maine Attorney General, State Lemon Law Arbitration Program), Massachusetts (Massachusetts Office of Consumer Affairs and Business Regulation (state-certified new car arbitration)), Montana (Montana Department of Justice, Office of Consumer Protection), Nebraska (Nebraska Department of Motor Vehicles, Legal Division), New Hampshire (New Hampshire New Motor Vehicle Arbitration Board (Department of Safety)), New Jersey (New Jersey Division of Consumer Affairs, Lemon Law Unit), New York (New York State Attorney General, Lemon Law Program), Rhode Island (Rhode Island Department of Attorney General, Motor Vehicle Arbitration Board), Texas (Texas Department of Motor Vehicles, Lemon Law Section), Vermont (Vermont Motor Vehicle Arbitration Board (Vermont DMV)), Washington (Washington State Office of the Attorney General, Lemon Law Administration).
In the other states the maker's own program, if it has one, is the first stop. Your state guide says whether you must use a program before going to court.
The federal rules for maker programs
When a warranty requires you to use the maker's program first, the program has to follow the FTC's Rule 703. Two parts matter most:
“within 40 days of notification of the dispute”
FTC Rule 703, 16 C.F.R. § 703.5(d)
“Decisions of the Mechanism shall not be legally binding on any person.”
FTC Rule 703, 16 C.F.R. § 703.5(j)
If you accept a decision, the maker must carry it out. If you reject it, you can sue. Federal law says you must try such a program first only when the warranty requires it:
“resort to such procedure before pursuing any legal remedy under this section respecting such warranty”
Magnuson-Moss Warranty Act, 15 U.S.C. § 2310(a)(3)
How to prepare
- Bring every repair order in date order, with the dates and days out of service counted.
- Bring your letters to the maker and its answers.
- Say what you want: a buyback or a replacement, with the numbers from the calculator.
- Have a lawyer look first. In most states the maker pays your lawyer if you win, and a lawyer knows what such programs award. The free case check finds one for you.
BBB AUTO LINE lists the makers whose programs it runs.
Questions people ask
Do I have to go to arbitration before a lemon law suit?
Only where your state's law or the warranty requires it. Your state guide quotes what its law says.
Is lemon law arbitration binding?
A maker's program under the federal rules does not bind you: if you reject the decision, you can still sue. The maker must follow a decision you accept.
How long does lemon law arbitration take?
A program under the FTC's rules must decide within 40 days of hearing about the dispute. State programs set their own times.
Sources
- FTC Rule 703, 16 C.F.R. § 703.5(d) (law.cornell.edu)
- Magnuson-Moss Warranty Act, 15 U.S.C. § 2310(d)(2) (law.cornell.edu)
- Each state's lemon law, quoted and linked on its state guide.
Quotes are copied from the page they link to, checked October 26, 2026.
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