What's the difference between a full and a limited warranty? What should you look for in a used car warranty?

Dealers may offer a full or limited warranty on all or some of a vehicle's systems or components. Most used car warranties are limited and their coverage varies.

A full warranty includes the following terms and conditions:

• Anyone who owns the vehicle during the warranty period is entitled to warranty service.
• Warranty service will be provided free of charge, including such costs as removing and reinstalling a covered system.
• You have the choice of a replacement or a full refund if, after a reasonable number of tries, the dealer cannot repair the vehicle or a covered system.
• You only have to tell the dealer that warranty service is needed in order to get it, unless the dealer can prove that it is reasonable to require you to do more.
• Implied warranties have no time limits.

If any of these statements doesn't apply, the warranty is limited.

A full or limited warranty doesn't have to cover the entire vehicle. The dealer may specify that only certain systems are covered. Some parts or systems may be covered by a full warranty, others by a limited warranty. The dealer must check the appropriate box on the Used Car Buyers Guide to indicate whether the warranty is full or limited and the dealer must include the following information in the "Warranty" section:

• The percentage of the repair cost that the dealer will pay. For example, "the dealer will pay 100 percent of the labor and 100 percent of the parts";
• The specific parts and systems, such as the frame, body, or brake system that are covered by the warranty. The back of the Buyers Guide lists the major systems where problems may occur;
• The warranty term for each covered system. For example, "30 days or 1,000 miles, whichever comes first"; and
• Whether there's a deductible and, if so, how much.

You have the right to see a copy of the dealer's warranty before you buy. Review it carefully to determine what is covered. The warranty gives detailed information, such as how to get repairs for a covered system or part. It also tells who is legally responsible for fulfilling the terms of the warranty.

If it's a third party, investigate their reputation and whether they're insured. Find out the name of the insurer, and call to verify the information. Then check out the third-party company with your local Better Business Bureau. That's not foolproof, but it is prudent. Make sure you receive a copy of the dealer's warranty document if you buy a car that is offered with a warranty.

If the manufacturer's warranty still is in effect, the dealer may include it in the "systems covered/duration" section of the Used Car Buyers Guide. To make sure you can take advantage of the coverage, ask the dealer for the car's warranty documents. Verify the information (what's covered, expiration date/miles, necessary paperwork) by calling the manufacturer's zone office. Make sure you have the Vehicle Identification Number (VIN) when you call.

If you have a written warranty that doesn't cover your problems, you still may have coverage through implied warranties. State laws hold dealers responsible if cars they sell don't meet reasonable quality standards. These obligations are called implied warranties - unspoken, unwritten promises from the seller to the buyer. When a dealer sells a vehicle with a written warranty or service contract, implied warranties are included automatically. The dealer can't delete this protection. Any limit on an implied warranty's time must be included on the written warranty.

(Source: Federal Consumer Information Center)