Michigan Leased Vehicles and Lemon Law Rights

If you lease a car, SUV, pickup truck, or van in Michigan and a serious defect keeps returning, you may have Michigan leased vehicle lemon law rights. Michigan’s New Motor Vehicle Warranty Act protects qualifying lessees when a manufacturer cannot repair a defect that substantially impairs the vehicle’s use or value. The available remedy is not necessarily limited to another repair. Depending on the facts, a lessee may be entitled to a refund of the lease price paid or a comparable replacement vehicle or a cash settlement under other law, as well as attorney’s fees.

If your leased vehicle has been in for repair for the same issue at least twice, or has been or will be out of service for at least 21 calendar days, that is enough to ask. Call Kahn & Associates for a free 60-Second Lemon Law Assessment at 1-888-536-6671 or complete the online case-review form. As of the beginning of 2026 our firm has recovered more than $65 million for consumers, we represent clients in Ohio, Florida, Michigan, North Carolina, and Pennsylvania, and clients are not required to pay out-of-pocket fees or costs, win or lose.

Does Michigan’s Lemon Law apply to a leased vehicle?

Yes. Michigan law expressly includes a person who leases a new motor vehicle within the definition of a consumer, and it also covers anyone otherwise entitled to enforce an express warranty under its terms. A qualifying vehicle generally must be:

• Designed as a passenger vehicle or sport utility vehicle. The statute excludes motor homes, buses, trucks other than a pickup truck or van, and anything designed to travel on fewer than four wheels, which leaves motorcycles outside the act (Note: federal law can typically help where state law does not);
• Purchased or leased in Michigan, or purchased or leased by a Michigan resident; and
• Covered by the manufacturer’s express warranty at the time of purchase or lease.

That last point is where most confusion about used vehicles comes from. The act does not require the vehicle to be unused. It defines a new motor vehicle by Michigan purchase or residency plus express warranty coverage at the time of the transaction, so a used vehicle that was still under the factory warranty when you leased it can fall inside the statute. A demonstrator is one example, not the only one.

The law focuses on the manufacturer’s warranty obligations, not on whether the consumer receives a title in their own name. The lease agreement, payment history, vehicle warranty, repair records, and the identity of the lessor all matter when determining what a successful resolution should look like.

What the act will not reach is a vehicle that had no manufacturer express warranty when you acquired it. A dealer warranty is not the same thing. That is not the end of the analysis, though. The federal Magnuson-Moss Warranty Act turns on the existence of a written manufacturer warranty rather than the vehicle’s age or mileage, and it does not require the vehicle to be under warranty today so long as repairs were performed under the manufacturer’s warranty or extended warranty. We evaluate every claim under both state and federal law.

That distinction matters for vehicle types as well. Michigan’s act does not reach motorcycles, motor homes and recreational vehicles, but a defective RV may still support a breach of warranty claim under federal law or the Uniform Commercial Code.

What vehicle problems may support a Michigan leased-vehicle claim?

Michigan’s Lemon Law addresses a defect or condition that impairs the use or value of the vehicle, or prevents it from conforming to the manufacturer’s express warranty. Note the statutory wording: Michigan speaks of use or value, not safety, which is different from most other states. A safety problem still counts, because a vehicle you cannot safely drive is impaired in both use and value, but the statutory test is framed around use and value. Examples can include recurring engine or transmission problems, stalling, braking or steering concerns, electrical failures, or another warranty defect that materially affects how the vehicle can be used. A single warning light is not by itself the kind of condition the statute is aimed at; what matters is the underlying problem and whether it keeps the vehicle from working as warranted.

Not every inconvenience is a lemon-law violation. A claim can be affected by the seriousness of the defect, whether the manufacturer or authorized dealer had a fair opportunity to repair it, when the problem was first reported, and whether the condition resulted from an excluded cause. Modifications not installed or made by or for the manufacturer, abuse or neglect, and damage from an accident can create separate coverage issues.

When does a leased vehicle meet Michigan’s repair-attempt standard?

Michigan’s statute provides two ways to establish that the manufacturer has had a reasonable number of repair opportunities. Each creates a presumption, and it helps to be precise about what that means. Under MCL 257.1403(5), meeting one of these thresholds presumes that a reasonable number of attempts to repair the defect have been undertaken. It shifts the burden: rather than the consumer having to prove the manufacturer had enough chances, the manufacturer has to show it did not. It does not decide the case, and the continuing defect, timing, and other requirements still matter. The provisions are set out in MCL 257.1403.

Four repair attempts for the same defect

The presumption arises when the same defect or condition that substantially impairs the use or value of the vehicle has been subject to repair four or more times by the manufacturer or an authorized Michigan dealer within two years after the first repair attempt, and the defect continues to exist. Keep every repair order even when the dealer describes the concern differently. The wording on a repair order can help show whether separate visits involved the same defect or condition when the complaint is given and written consistently.

Thirty or more days out of service

The presumption also arises when the vehicle has been out of service for repairs for 30 or more days, or parts of days, during the earlier of the manufacturer’s express-warranty term or one year after delivery to the original consumer. The days do not need to be one continuous stay at the dealership. Record the dates the vehicle was unavailable because of repair work and compare them with the repair orders.

You do not need to reach either threshold before asking. Two repair visits for the same issue, or 21 calendar days out of service, is enough to have our firm review the record.

What notice and final repair opportunity are required?

Michigan attaches a single notice requirement to both presumptions, not two separate ones. Whichever route applies, the consumer must give the manufacturer written notification before pursuing the statutory remedy, so that the manufacturer has an opportunity to cure. What differs between the two routes is only when that obligation is triggered. The manufacturer then designates a repair facility and has a short, defined window to complete a final repair attempt.

These requirements are technical, the timing is tied to specific points in the repair history, and getting the step wrong or missing it can weaken an otherwise strong claim. Preserve everything connected to it: any notice you send, the mailing receipt and delivery confirmation, the manufacturer’s response, and the repair order from any final repair attempt. This is one of the clearer reasons to talk to counsel early rather than after the repair attempts have run out.

Michigan also has a separate wrinkle: where a manufacturer maintains a qualifying informal dispute settlement procedure, the act may not apply to a consumer who has not first used it. Whether that affects your claim depends on your manufacturer, which is another reason to get the file reviewed before acting.

The initial report of the defect also matters. The defect generally must have been reported to the manufacturer or an authorized dealer during the manufacturer’s express-warranty term or within one year after delivery to the original consumer, whichever comes first. If the defect was reported on time, a repair related to that report may continue after the warranty expires. Do not wait until a warranty deadline is close before organizing the record or asking for help.

Delay carries a second cost that owners rarely anticipate. Every month you keep driving the vehicle and adding miles gives the manufacturer an argument that the defect is not substantially impairing its use or value. A vehicle driven for a long stretch after the repairs looks, to a manufacturer’s lawyer, like a vehicle that works.

What remedies are available for a leased vehicle?

When the statutory requirements are met and the defect continues, the statute describes the remedy slightly different for a lease than for a purchase, but the destination is the same: you are generally made whole and the financing is resolved rather than left on your shoulders. A lessee has the right to a refund of the lease price paid by the consumer and may instead agree to accept a comparable replacement vehicle. The manufacturer also can be made to pay attorney fees as part of the resolution, so pursuing the claim does not typically reduce what you recover.

Refund of the lease price

A lease refund is not necessarily the same thing as adding up every monthly payment and stopping there. Michigan’s definition of lease price includes the actual vehicle sales price paid by the lessor, certain cash and trade-in amounts, and specified taxes, license and registration fees, and similar charges paid by the lessor. It also addresses options, manufacturer-installed modifications, and other manufacturer charges. The lease contract and the interests of the consumer, lessor, and any secured party affect the calculation and distribution.

The statute also provides that a refund is made to the consumer and secured party, if any, according to their interests at the time of the refund, so the outstanding financing is addressed as part of the remedy rather than left for you to carry. The lessor must be notified if a refund is made to a lessee. Do not assume that a consumer can simply cancel the lease, stop making payments, or return the vehicle without coordinating the statutory process and the parties’ interests.

Comparable replacement vehicle

A lessee may agree to accept a comparable replacement vehicle instead of a refund. If the consumer accepts that option, the lease agreement may not be altered except for the identification of the vehicle. That means the proposed replacement and the treatment of the existing lease should be reviewed carefully before a consumer signs a settlement or accepts a new vehicle.

No early-termination fee under the Act

Michigan’s New Motor Vehicle Warranty Act states that a lessor may not assess a fee for early termination of a lease under the Act. This protection does not mean every lease question disappears. The lessor still has a role in the transaction, and the lease documents should be reviewed so that the refund, notice, vehicle return, and any replacement arrangement are documented correctly.

Where a cash settlement fits

Not every claim produces a statutory refund or replacement. Which remedy is available is usually not the consumer’s choice: it normally depends on whether the claim qualifies under the state statute at all. Where it does not, cash is typically the only offer, with the matter resolving under federal law as a breach of warranty. Occasionally a manufacturer prefers cash because the buyback numbers do not work for it, or a consumer who does qualify passes on a buyback because replacement vehicles have become too expensive. If a lease claim resolves for cash, the money can go toward what you still owe, toward a down payment on a replacement, or you can simply keep it. Our overview of lemon law protections for lessees compares how the states handle this.

How does Michigan calculate the use allowance?

A qualifying refund can be reduced by a reasonable allowance for use. Under MCL 257.1403, the calculation uses a 100,000-mile denominator. The numerator includes miles attributable to the consumer and any previous consumer before the first report of the defect or condition, plus miles attributable to the consumer beyond 25,000 miles. The statute also addresses appraised damage that is not attributable to normal use or to the defect.

Michigan is more specific about towing and rental than many states. Where the vehicle is replaced or refunded, and towing services and rental vehicles were not made available to you without cost, the statute provides that the manufacturer shall also reimburse towing costs and reasonable costs for a comparable rental vehicle incurred as a direct result of the defect. The obligation is mandatory once those conditions are met, which is why it is worth keeping towing invoices, rental receipts, and proof of the dates the vehicle was unavailable.

Because the use allowance and lease-price calculation depend on the vehicle’s mileage, first report date, lease terms, payments, and other records, a lessee should not rely on a generic online calculator. A precise review of the documents can show which numbers are relevant and which proposed deductions need to be questioned.

What should a Michigan lessee document?

Before contacting the manufacturer or asking for a case review, gather the records you have. They do not need to be organized first, and missing documents do not automatically end a claim, but a complete timeline makes it easier to understand the problem and protect the consumer’s position.

• The lease agreement, addenda, and any purchase or trade-in paperwork;
• Any warranty communications you have. You do not need to track down the warranty booklet itself, since we can usually locate the terms;
• Every repair order, including the date, mileage, reported concern, diagnosis, and work performed;
• A running list of the dates the vehicle was unavailable or at a repair facility;
• Emails, letters, text messages, and call notes involving the manufacturer, dealer, or lessor;
• Any photos, video, or audio you captured of the problem, which can show a condition a technician could not reproduce;
• Records of payments, towing, rental vehicles, and other direct expenses; and
• Copies of any written notice, return receipt, delivery confirmation, and final repair response.

Write down what happened in your own words while the events are fresh. Include safety concerns, repeated symptoms, and how the defect affected work, family transportation, or ordinary use. Do not alter repair records or discard an older version of a document after receiving a corrected copy.

What should I do if my leased vehicle is still defective?

Continue following the manufacturer’s warranty and lease obligations while the claim is evaluated. Report the defect clearly, keep the vehicle available for reasonable repair opportunities, and preserve the documents described above. Do not sign a release, accept a replacement vehicle, or agree to a lease termination charge without understanding what rights and obligations the proposed resolution addresses. Read our Michigan Lemon Law overview for broader state-law background.

Kahn & Associates represents consumers in manufacturer breach of warranty and lemon-law claims. We do not handle dealer-fraud or other sales-practice cases. We evaluate claims against the manufacturer, bring them, and work to win them, including claims involving leased vehicles, with no out-of-pocket fees or costs to the client, win or lose. Fees are typically negotiated with the manufacturer as a part of any resolution.  Request a free review from our firm if your vehicle’s defects and repair history may fit the requirements.

Michigan leased-vehicle Lemon Law questions

Can I have a Michigan Lemon Law claim if I lease instead of buy?

Yes. Michigan’s statute expressly includes lessees. The vehicle must still meet the requirements involving vehicle type, Michigan purchase or residency, manufacturer’s express warranty, qualifying defect, timely reporting, and reasonable repair opportunities.

Can I stop making my lease payments while my claim is pending?

Generally No. Do not assume that a pending lemon-law claim cancels your lease obligations. The statute addresses the remedy and the interests of the consumer, lessor, and secured party, but a consumer should continue addressing the lease as required unless an attorney advises otherwise based on the specific agreement and claim.

Does four repair attempts automatically mean the manufacturer must buy back my leased vehicle?

No. Four attempts for the same continuing defect within the statutory period can support a presumption that a reasonable number of repairs occurred, but the other requirements and procedure still matter. Notice, timing, nature of the defect, warranty coverage, the condition of the vehicle, and the available remedy must be evaluated together. A presumption shifts the burden to the manufacturer; it does not decide the case.

Can a used leased vehicle qualify?

Possibly, and the answer depends on which law applies. Under the Michigan statute the vehicle generally must still have been covered by the manufacturer’s express warranty at the time of lease, and the other statutory requirements must be satisfied. Under federal law the vehicle does not need to be under warranty today, so long as repairs were performed under the manufacturer’s warranty or extended warranty. The warranty and lease records should be reviewed under both.

Will I receive every payment I made on the lease?

In broad terms, yes: the aim is to return what you have paid in, less the statutory mileage offset, with the lessor and any secured party handled separately so you are not left carrying the financing. The exact figure is more specific than a simple total of monthly payments, because the statute defines lease price to include amounts beyond your own payments and deducts a reasonable allowance for use. Mileage, the date of the first report of the defect, charges, and appraised damage not attributable to normal use or to the defect all affect the calculation. The law also contemplates that a prevailing consumer can recover attorney fees, and in practice they are typically negotiated with the manufacturer as part of the overall recovery.

Find Out Where Your Michigan Lease Stands Under the Lemon Law

A leased vehicle that keeps going back to the dealership is not a problem you have to keep absorbing, and a lease does not put you in a weaker position than a buyer. Michigan gives lessees the same core protections, including a refund of what you paid in, a bar on early-termination fees, and reimbursement of towing and rental costs the defect caused you.

What it does not give you is unlimited time. The reporting window for the state lemon law closes at the earlier of the warranty term or one year from delivery, and every additional month of driving hands the manufacturer an argument that the defect is not impairing anything.  There is still a federal lemon law if the state law no longer applies.

Two repair visits for the same issue, or 21 calendar days out of service, is enough to find out where you stand. Request a free case review or call Kahn & Associates at 1-888-536-6671. There are no out-of-pocket fees or costs to you, win or lose.