Texas Lemon Law (TX)

Texas Does Lemon Law Differently: A State Agency Handles It

In most states a lemon law claim means arbitration or a lawsuit. Texas instead routes claims through the Texas Department of Motor Vehicles under Tex. Occ. Code ch. 2301, subchapter M. The process is cheap ($35 filing fee, refunded if you win), doesn't require a lawyer, and ends in a binding decision from a state hearing examiner. The trade-off: you must exhaust this administrative process before you can sue (§ 2301.607) — if TxDMV hasn't issued a final order within 150 days of your complaint, it must notify you of your right to go to court.

1. Give written notice. Send the manufacturer written notice of the defect — certified mail recommended — and at least one opportunity to cure. TxDMV publishes a sample notice letter. No repurchase or replacement can be ordered without this step.
2. File the complaint. Use TxDMV's Lemon Law page and its online complaint system, with the $35 fee. Questions: 888-368-4689 or [email protected].
3. Mediation, then hearing. TxDMV staff first try to settle the case. If that fails, a hearing examiner hears evidence and must issue a written decision within 60 days of the hearing's close.
4. Decision and appeal. The examiner can order repurchase, replacement, or repair. Either side can seek rehearing and then judicial review in Travis County district court.

The Three Lemon Presumption Tests (and the Real Deadline)

• Four-attempt test: the same defect was repaired 4+ times in the first 24 months / 24,000 miles and still isn't fixed.
• Serious safety-hazard test — only 2 attempts: for a life-threatening malfunction that impedes control of the vehicle or creates substantial risk of fire or explosion, two failed repairs are enough.
• 30-day test: out of service for warranty repair a cumulative 30+ days in the first 24 months / 24,000 miles with a substantial defect remaining. Days you had a comparable loaner don't count.

The filing deadline trips people up: a complaint must be filed within 6 months after the earliest of (1) your express warranty expiring, (2) 24 months after delivery, or (3) 24,000 miles (§ 2301.606(d)). If your warranty is short, the clock can run out well before two years. TxDMV's own advice is to file as soon as it's clear the dealer can't fix the problem. Manufacturer defenses mirror other states': abuse, neglect, unauthorized modification, or a defect that doesn't substantially impair use or market value (minor rattles and radio static don't qualify).

How Texas Calculates Your Refund (TxDMV's Actual Formula)

A repurchase order refunds the purchase price including tax, title, and license, minus a use deduction TxDMV computes with a formula that presumes a vehicle's useful life is 120,000 miles — and, notably, charges only half rate for miles you drove after first reporting the defect:

deduction = price × (miles before first defect report ÷ 120,000)
         + price × (miles after report ÷ 120,000) × 0.5

Example: $40,000 vehicle, defect first reported at 5,000 miles, 12,000 miles on the odometer at the hearing. Full-rate deduction: $40,000 × 5,000 ÷ 120,000 = $1,667. Half-rate deduction: $40,000 × 7,000 ÷ 120,000 × 0.5 = $1,167. Repurchase ≈ $37,166 plus your $35 filing fee back. Interest paid on your auto loan is not refunded, and any lienholder is paid first. Leases have a parallel formula returning your inception payments and monthly payments minus a use allowance; towable RVs use days of use instead of miles.

What's Covered — Broader Than Most States

• Covered: new cars, trucks, vans, motorcycles, ATVs, motor homes, towable RVs (travel trailers), and neighborhood electric vehicles with a manufacturer's written warranty — purchased or leased. Untitled demonstrators count as new.
• Not covered: used and repossessed vehicles (for refund/replacement), non-travel trailers, boats, and farm equipment.
• Used vehicles still have a path: if the vehicle is under the manufacturer's original warranty — or the defect was first reported while it was — a warranty-performance complaint (§ 2301.204) through the same TxDMV process can get the defect repaired, just not repurchased. Beyond TxDMV: the federal Magnuson-Moss Warranty Act and the Texas DTPA (see the Texas State Law Library's warranty guide).
• Buying a former lemon: repurchased vehicles resold in Texas must carry a disclosure statement and a fresh 12-month/12,000-mile warranty after repair (§ 2301.610).
• Tip: warranty repairs can be performed at any franchised dealer of your brand — you're not tied to the selling dealer.

Sources

• TxDMV — Texas Lemon Law (official process, tests, deadlines, $35 fee)
• Tex. Occ. Code ch. 2301, subch. M — official statute text
• TxDMV Lemon Law brochure (PDF)
• TxDMV repurchase calculation worksheet (XLS — source of the formula above)
• Texas State Law Library — Warranty Law research guide

Statutes and agency guidance last reviewed July 2026.