To Gap or Not to Gap

[itsbob]

Thank you all for your opinion on if we should get gap or not. We are looking at purchasing a 2012 Focus Hatchback that is used. Unfortunately I have not been able to pull up a Blue book value on that model as it is still considered "new".

I was thinking with the significant amount of money down and the vehicle being driven locally for the most part (besides maybe a trip to dc or baltimore), then the mileage would stay rather low.

It is a younger lady driving the vehicle. She did total her last vehicle. It is something I am really stuck on....with the last vehicle being totaled by insurance I am wanting to jump on board w/ gap insurance.

On the other hand, we are getting the vehicle at a pretty decent price, while the first owner has already taken the hit for driving it off of the lot. I am hesitant due to the fact that there will not be a lot of miles, <20,000 a year, on the vehicle. I guess I will see what the car company says to do when we go back to financing. The salesman seems to be pretty nice and not up our behinds while looking around the lot.

For a good guesstimate.. Take the KBB price for new and deduct 25%.

 

[aps45819]

For a good guesstimate.. Take the KBB price for new and deduct 25%.

There is usually very little difference in the asking price of a current year used and a new car. Unless you're coming in at leat $5K under the price of new, get a better deal.

 

[calvcopf]

Looking at purchasing a new vehicle. We were asked by the finance office if we wanted Gap insurance. I know in some cases this is good, but in others not so good. We are putting a sufficent amount of money down on the vehicle (over 5000) while the vehicle is totaling just over 17000. Should we purchase the gap insurance they are offering, or should the money be good enough of a down payment to cover the depreciation when we drive it off of the lot.

Your thoughts?

GAP It!

GAP insurance is definitely worth it. My new car was a total loss after hitting a deer at highway speeds. If I would not have had GAP, I would have still owed over $3,000 dollars on a car that I no longer owed. They do not make it easy to file a GAP claim. You have to submit all of the paperwork from your lender, insurance company and fill out the claim forms yourself. But a few hours of paperwork is much better than owing lots of money, especially since you will not have a car at that time and will be looking to purchase another car. I was skeptical of GAP at the dealership too, but I sure was glad that I got it. I highly recommend getting it!

 

[KDENISE977]

I was a finance manager for 10 years, I sold GAP at the dealership, made a lot of money doing so. GAP is worth it in some instances and when purchased at a reasonable price. I have also worked for banks and credit unions in the lending departments. Again, GAP has proven worth the cost, as long as it's a reasonable cost, time and time again. It always depends on your loan to value, finance terms, etc. If you took out an extended term such as 72 months or longer it's usually your best bet to purchase it and have it if needed, rather than need it and not have it !! You'll find people who will swear by it and you'll have several different explanations and names it's called. GAP insurance stands for guaranteed auto protection, and it's can range anywhere from 100% pay off to only covering ACV (actual cash value). What it all depends on is the company who is selling the coverage, not the dealership or the finance company. You receive a prorated refund if you cancel it or trade in the car. There are TONS AND TONS of different companies selling GAP insurance or something like it, auto finance companies, banks, credit unions, etc.

 

[nutz]

USAA financed my last vehicle purchase. Navy Federal was runner up. At the time, both of them included a GAP provision at 0 cost to me.