In general, a lemon law requires a manufacturer to repair a vehicle until it works properly, or if it cannot do so, it must either give the consumer a full refund or a new vehicle. Arizona's lemon law is similar to lemon laws in the other 49 states, and all are patterned after California’s Tanner Act, which was passed in 1980. Arizona’s lemon law can be found in Arizona Title 44, Chapter 9, Article 5: Motor Vehicle Warranties.
A vehicle returned under a state’s lemon law is not a repossession. A car returned under a lemon law should have no effect whatsoever on your credit score, assuming you continued to make all of your payments on time throughout this ordeal.
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